4 ms·

If you are a rank and file employee, I would suggest divesting entirely from your company's stock. From a risk perspective it's extremely dangerous as you are a

by pg_bot 8y ago

If you are a rank and file employee, I would suggest divesting entirely from your company's stock. From a risk perspective it's extremely dangerous as you are already dependent on your employer for your source of income. In the case that they do poorly you have the potential to lose both your income and your savings. Unless you have the ability to seriously affect the stock price, you are putting too many eggs into a single basket.

Retric 8y ago
With matched contributions it's a hard choice. You are effectively buying stock at a huge discount, having up to say say 20% of your savings in the company stock is very likely to be a good idea. You just need to be selling it ASAP.
acjohnson55 8y ago
Not sure that's universally a good idea. Rank-and-file may still have inside information that makes holding stock advantageous (obviously adhering to any applicable insider trading rules). If your skillset is highly portable, you can probably consider your income decoupled from your employer. Your equity with your employer could then be considered high-risk moonshot investment. But I certainly agree that your core nest egg and growth investment be kept totally decoupled.
- xiphias 8y ago
  Every employee has insider information. For me at Google the biggest change was from Eric Schmidt answering directly to questions at TGIF and looking at easy to fix things when he could and looking for great growth possibilities to Larry Page talking about working hard for the sake of working hard to finally Sundar who's looking at Larry for every question and make sure to answer as politically as he can and not upset Larry. Also even project level big meetings took more than 50% of the time to speak about respecting women. I respect women, but when the focus on them is bigger than the focus on users/customers, I know it can't be the growth company that it was before.
pmiller2 8y ago
There's no need to divest entirely, assuming a reasonable portion (say, no more than 3-5%) of total holdings is in company stock. That said, I have heard someone in my company say they refuse to invest in tech stocks at all, because they're concerned about a sector-wide downturn taking out both their job and their investment gains. I think that's a bit of an extreme position, but I understand where it's coming from.
- ajmurmann 8y ago
  It seems extreme but if you don't have enough other savings to bridge 1-2 years of joblessness I think it's very reasonable. The tech sector might tank and come back but you need enough breath to wait for recovery.
madengr 8y ago
I don't consider 20% as having all the eggs in one basket. I sold it all at $80 years ago, thinking it was too high (it was at $20 when I started in mid 90's). I'd be up several $100k if I had not sold it.

by pg_bot 8y ago

Retric 8y ago

With matched contributions it's a hard choice. You are effectively buying stock at a huge discount, having up to say say 20% of your savings in the company stock is very likely to be a good idea. You just need to be selling it ASAP.

acjohnson55 8y ago

Not sure that's universally a good idea. Rank-and-file may still have inside information that makes holding stock advantageous (obviously adhering to any applicable insider trading rules). If your skillset is highly portable, you can probably consider your income decoupled from your employer. Your equity with your employer could then be considered high-risk moonshot investment. But I certainly agree that your core nest egg and growth investment be kept totally decoupled.

xiphias 8y ago
Every employee has insider information. For me at Google the biggest change was from Eric Schmidt answering directly to questions at TGIF and looking at easy to fix things when he could and looking for great growth possibilities to Larry Page talking about working hard for the sake of working hard to finally Sundar who's looking at Larry for every question and make sure to answer as politically as he can and not upset Larry. Also even project level big meetings took more than 50% of the time to speak about respecting women. I respect women, but when the focus on them is bigger than the focus on users/customers, I know it can't be the growth company that it was before.

pmiller2 8y ago

There's no need to divest entirely, assuming a reasonable portion (say, no more than 3-5%) of total holdings is in company stock. That said, I have heard someone in my company say they refuse to invest in tech stocks at all, because they're concerned about a sector-wide downturn taking out both their job and their investment gains. I think that's a bit of an extreme position, but I understand where it's coming from.

ajmurmann 8y ago
It seems extreme but if you don't have enough other savings to bridge 1-2 years of joblessness I think it's very reasonable. The tech sector might tank and come back but you need enough breath to wait for recovery.

madengr 8y ago

I don't consider 20% as having all the eggs in one basket. I sold it all at $80 years ago, thinking it was too high (it was at $20 when I started in mid 90's). I'd be up several $100k if I had not sold it.