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In 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 ar
by Tagbert 5y ago
In 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 .
- chrisjc 5y agoYup, makes sense. I thought there might be some kind of specific tax loophole or trick to moving the money out of the ESPP. I'm finding more and more of these tricks as time goes on, such as post-tax traditional 401k mega-backdoor Roth money (if it lasts past this year), etc...
- barrkel 5y agoIf you're restricted in trading for insider information reasons, you're often also restricted in trading other industry stocks for conflict of interest reasons. Not a bad thing to diversify, but of you diversify to e.g. an index fund, often you end up correlated with tech owing to how large a chunk of index growth is down to Apple, Google, Amazon etc.
- distances 5y agoI've never heard of this. There are plenty of companies that add each and every engineer, developer, and r&d person on the insider list. I've been to two, and haven't seen any such guidance.
- MR4D 5y agoThese aren’t options. Also, if you ran the second biggest company on the planet, your investors would hate you for that behavior.