4 ms·

> I have a metric shit ton of Apple stock after being there for several years. At least until I hold the stock for a year and only pay capital gains on it. Ge

> I have a metric shit ton of Apple stock after being there for several years. At least until I hold the stock for a year and only pay capital gains on it. Genuine question for anyone who gets RSUs at a public company like this. Why do you keep your $FANG stock when it is granted? You've already paid income tax on the basis, which is the closing price the day you got it. The year long timer for long term capital gains tax starts the day you get it. So vesting $X of grants on your vesting day and holding is equivalent to just buying $X of stock on any old day. As a bonus, you're already heavily heavily exposed to that stock because A) they're your employer, and B) presumably unvested RSUs coming in the future.

nine_k 7y ago
It's not an equivalent of buying. It's an equivalent of receiving it and paying taxes on it immediately right with the stock, or with your cash if you so choose. If your particular letter of FAANG currently outperforms the market ("S&P 500" index, etc), I see no incentive to immediately sell it and reinvest into something else. Of course you can sell and reinvest if you see an even better investment opportunity, but most of the employees don't, they are engineers, not experienced stock traders.
- positr0n 7y ago
  What's the difference that it is not equivalent to buying? Nothing is special tax-wise about those shares that they came from RSUs. If you got N shares at $X you've paid taxes on $X*N, she same if you bought those shares with cash in your bank account. If you wish to own extra stock in your employer you'd be better suited to dollar cost average and buy every paycheck. > If [your company] currently outperforms the market What does that mean? Outperforms over some past time period? That has no bearing on the future. If you have insider knowledge that you think your company will outperform the market in the future I agree it makes sense to keep, but see above about dollar cost averaging and also consult your lawyer about insider trading laws. > most [don't], they are engineers, not experienced stock traders. Exactly, and the standard advice for non-experts is to buy index funds. Not try and guess which specific companies will outperform the market.

nine_k 7y ago

It's not an equivalent of buying. It's an equivalent of receiving it and paying taxes on it immediately right with the stock, or with your cash if you so choose. If your particular letter of FAANG currently outperforms the market ("S&P 500" index, etc), I see no incentive to immediately sell it and reinvest into something else. Of course you can sell and reinvest if you see an even better investment opportunity, but most of the employees don't, they are engineers, not experienced stock traders.

positr0n 7y ago
What's the difference that it is not equivalent to buying? Nothing is special tax-wise about those shares that they came from RSUs. If you got N shares at $X you've paid taxes on $X*N, she same if you bought those shares with cash in your bank account. If you wish to own extra stock in your employer you'd be better suited to dollar cost average and buy every paycheck. > If [your company] currently outperforms the market What does that mean? Outperforms over some past time period? That has no bearing on the future. If you have insider knowledge that you think your company will outperform the market in the future I agree it makes sense to keep, but see above about dollar cost averaging and also consult your lawyer about insider trading laws. > most [don't], they are engineers, not experienced stock traders. Exactly, and the standard advice for non-experts is to buy index funds. Not try and guess which specific companies will outperform the market.