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Satya Nadella Sells Half of His Shares in Microsoft
- 1cvmask 5y agoDoes he think Microsoft is close to peak valuation or that the markets are frothy? Or maybe he just wants to diversify or buy personal toys and real estate. He still has about $300 million in shares. There also seems to be a potential tax element to it: “Satya sold approximately 840,000 shares of his holdings of Microsoft stock for personal financial planning and diversification reasons,” a Microsoft spokesman said in a written statement. “He is committed to the continued success of the company and his holdings significantly exceed the holding requirements set by the Microsoft Board of Directors.” Analysts said the move could be related to Washington state instituting a 7% tax for long-term capital gains beginning at the start of next year for anything exceeding $250,000 a year.
- Finnucane 5y agoDoes it really matter? No matter what, extremely wealthy guy will still be extremely wealthy guy.
- jdsully 5y agoIt matters if your a MSFT shareholder and are wondering if you should “diversify” too.
- seanmcdirmid 5y ago> It matters if your a MSFT shareholder and are wondering if you should “diversify” too. The answer to that question is yes, regardless of what Nadella does/did. I guess if you have a feeling MSFT is going to outperform the tech market or market as a whole, not diversifying can work, or if you lack the ability to hedge much and want a chance to get rich (and a chance to lose it also).
- jdsully 5y agoYou might have that feeling, but reconsider with the new information about insider selling. Insider trades do correlate to investment performance.
- seanmcdirmid 5y agoWhelp, if you took that as a sell signal when he sold 30% of his stock in 2018, you probably did very poorly in the market since then: https://www.cnbc.com/2018/08/10/microsoft-ceo-satya-nadella-sells-30-percent-of-common-stock.html https://www.cnbc.com/2018/08/10/microsoft-ceo-satya-nadella-... Of course, he lost out selling at $100/share (vs today's $300+/share). And in 2014 when he sold a bunch of stock at $50/share. I'm going to say that if history has any saying in this, it means that the stock will be at $600/share the next time he sells.
- sumedh 5y agoInsider selling is usually not a strong signal because you sell shares for multiple reasons, diversify, buying house, divorce etc. Insider buying is considered a strong signal because you usually buy because the insider thinks the share price will appreciate in the future.
- servytor 5y agoI wouldn't short Microsoft with the promise of Windows Continuum and Windows 365. I mean in my opinion, Microsoft chose to fail in competing with a smartphone OS because there would be an antitrust lawsuit.
- elromulous 5y agoCan't tell if you're being factious with the second part of your comment. It's almost certainly untrue. Iirc Gates was quoted regretting missing out on the mobile market.
- 1cvmask 5y agohttps://archive.md/iwqZd https://archive.md/iwqZd
- Tagbert 5y agoIn most cases where I have been given company stocks as part of compensation, I usually sell them as soon as I can. Depending on your role in the company you are often very restricted about how much you can sell and when. There are limited trading windows where you can legally sell and any inside information may prevent it even then. I’d rather have my money in some other stock where I have more freedom to trade.
- irrational 5y agoSame here. I receive stock twice a year. I always sell it that same day.
- chrisjc 5y agoCurious why you sell right away? No faith in your company or is there another reason I'm missing?
- irrational 5y agoI need the money now more than I need the potential increase in value sometime in the future.
- jamiepenney 5y agoI've done this in previous jobs - nothing to do with the company itself, I just don't like tying both my investment and wage income to the same company.
- shric 5y agoAsk yourself "if I was given the equivalent in cash instead of equity (e.g. a bonus or just an increased base), would I buy shares in my employers' company?" If the answer is no, then it makes sense to sell immediately.
- rjbwork 5y agoDiversification. If you consider that your employment at an employer is one part of your investment strategy, then it makes sense to diversify your portfolio as much as possible. Keeping those eggs in the same basket presents increased firm-specific risk .
- moneywoes 5y agoHe saved roughly 21 million by doing this prior to the capital gain tax coming to WA. Any word on whether the legal challenge has held up?
- JoeAltmaier 5y agoGave this advice to people in successful startups: if you had $X million, would you sink it all into one company? If the answer is no, you should diversify.
- perl4ever 5y agoYes, but when you look around at multi-billionaires, they generally didn't diversify. Ronald Wayne supposedly sold his 10% share of Apple for $800. “Put all your eggs in one basket—and watch that basket.” -Andrew Carnegie
- skinnymuch 5y agoThere’s a significant amount of luck involved with what you’re pointing out. In the situation of owning a relatively small amount of a company, the actions of billionaires have nothing to do with the actions of your average non-early employee.
- UncleMeat 5y agoIf your goal is to become a multi-billionaire then sure, you need to take way more risk. But I'd wager that this is not most people's goal. If your goal is to accumulate enough wealth to have a safe retirement portfolio then you don't need to take the large risk for the large potential maximum benefit.
- perl4ever 5y agoThe context seems to be reallocating several hundred million dollars. I agree that at least 1% of it, if a person had nothing else, which they probably would, should be put aside for retirement. I thought that went without saying. Nevertheless, keeping 99% in one company would not be diversified.
- JoeAltmaier 5y agoYes, but that's survivor bias. "I put it all on 27 and spun the wheel! That's clearly the only way to go."
- throwawaymanbot 5y agoI guess hell use this money to spend in the new "Pay for dealz" browser they are about to launch. NICE!