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Debt costs money. If you are an investor you want to take as much of a share of profits as you can. Hedges like that are for people who can’t afford to cover t
by erikpukinskis 7y ago
Debt costs money. If you are an investor you want to take as much of a share of profits as you can.
Hedges like that are for people who can’t afford to cover the downside. Bezos can, so a hedge would just lower the value of his overall holding.
- mruts 7y agoNo, he would make more money using debt than selling shares. Assume he borrows at 3%, then Amazon just needs a higher return than 3% and he has made more money than just selling the shares. What you’re saying doesn’t make any sense.
- mantap 7y agoDebt has a psychological cost too, you owe something to someone, in this case several billion dollars, so not pocket change. Perhaps, after becoming the richest man alive, being free of debt is worth more to him than extra money.