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So since you were holding for long term capital gains tax treatment, did you consider writing calls on them? Many big companies have deep exchange traded option
by elastic_church 10y ago
So since you were holding for long term capital gains tax treatment, did you consider writing calls on them? Many big companies have deep exchange traded options markets a year out, where you can easily get an extra 10% by simply writing a near the money call (if you have at least 100 shares).
- ChuckMcM 10y agoGenerally every publicly traded company except Sun had me specifically agree to not trade in any options (of any kind) on the company's stock. There are also complications in the way in which trading windows work, although I expect you could argue writing a call was equivalent to a 41-b disclosure in terms of market visibility.
- elastic_church 10y agointeresting, wow, in that case I would immediately sell (depending on the tax scenario) and buy a competitor's stock or something in the same sector to write calls on proxy trade
- ChuckMcM 10y agoYup. From a hedge standpoint that makes the most sense. But lets say you're a Facebook employee, what is your hedge? Google? Apple?
- elastic_church 10y agoor just buy the broad sector ETF and write options on that, but the volatility premiums are substantially larger on tech companies (because people going long are greedy) especially decent since this entire scenario doesn't really account for possible appreciation in price of the shares, and just capital preservation with decent annual gains and lower tax