It is actually worse than that. To diversify and reduce your financial risk, your money should be concentrated away from where you work. (Otherwise, for example, if the company goes bankrupt, you lose both your savings and your job!)
That's not quite true: you certainly picked which company to work for, and who'd choose to work for a company they don't believe will be successful?
But greeneggs has it right: you don't want to put yourself into a situation where you lose both your job and your biggest investment tanks.
1. You believe in their mission (e.g working for a newspaper even though that industry is in real trouble) 2. You have constraints around when and where you can work - limited to a certain town, need part-time work 3. They offer a high salary for your specific skills - sure, they might be out of business in a few years but you can make good money for the moment
Majority of yahoo employees since 2004-ish? Or Blackberry after 2009?
Think of it this way: look at all the employee stock you hold and ask yourself, "would I ever buy this much stock from this company if I didn't work here?" Of course not. The only reason you have it at all is because you got it in a stock grant or bought it at a substantial employee discount. But now that you have it, it's the biggest individual position you have in the whole market. Where you happen to work is a totally arbitrary consideration relative to where your money should be, so this is a really silly state of affairs. There's just no sound reason for you to be holding it just because someone happens to have given it to you; past events are irrelevant to your present decisions. So execute your options as soon as they vest and buy into no-load ETF or something.