Pros and cons of buying the option. With a strike price of $0.25 and expiry on 14 Dec 2020, it does not make any sense at first glance to buy the oppies now when the share price is only $0.049. but that's not how the oppies are being valued.
Assuming a capital of $10000, at current price you are able to buy 204k main shares at $0.049 or 526k options at $0.019 (assuming the volume is there).
say the share price did a massive surge to $0.50 by end 2020 your main share valuation will go up to $0.50 x 204k = $102k, about 10 times your initial capital.
however, if you had bought the options, you are able to pay $0.25 per share to exercise the options and immediately sell away at $0.50 to gain $0.25 per share. Take note that you have 526k options, means your profit at the point is 526k x $0.25 = $131.6k.
the higher the share price grows, the better the option is. However, this is a massive bet as you need to bang on the share price having a very significant rerate by end 2020. Whether is it worth the risk is up to individual. The con is you get back nothing if price don't go beyond $0.25 + your purchase price of options.
but seeing the options going up gives the indication that the market is predicting a significant share price increase in the future.
