5 ms·

Someone who earned 150k cash and 50k stock might be able to save, but they'd probably just keep their stock as their "emergency fund". Twitter are blocking them

Someone who earned 150k cash and 50k stock might be able to save, but they'd probably just keep their stock as their "emergency fund". Twitter are blocking them selling that stock. Effectively Twitter are laying people off and putting a freeze on their savings account. I think it's reasonable to have a little sympathy for people in that situation.

baskethead 4y ago
Once they leave the company they are free to sell the stock. They are not beholden to a stock blackout anymore.
- onion2k 4y ago
  That isn't how it works unfortunately. If the shares vest during the blackout period they're only released to the employee, or former employee, once the blackout ends. The employees can't sell these until the blackout is lifted. Currently there is no end date set.
  - rconti 4y ago
    So this would only be an issue if they had no savings and had turned+burned all of their RSUs each pay period? (or, to be more charitable, just hit their 1 year cliff).
    - HWR_14 4y ago
      I think it's an issue if they had RSUs accumulated over N years and had not moved them to their brokerage account.
  - notch656a 4y ago
    I would think someone would be happy to lend you the number of shares you have blacked out for a large fee, with a contract you release that to the lender afterwards. Something like "we lend you 75% face of your blackout shares now, in return we get all your blackout shares when they're released." Edit: Per below comment, don't do this :)
    - sokoloff 4y ago
      Most of these anti-insider trading policies prevent all of the obvious "one clever tricks" by prohibiting entering into options contracts, lending, borrowing, shorting, executing futures transactions, etc. If you could find someone to lend you cash (based on the totality of your financial situation and personal credit), that's fine. It's not fine to borrow someone else's shares and short them during a blackout.
      - thrown321 4y ago
        Regular folks are not insiders. You can certainly pledge collateral for a loan.
        saagarjha 4y ago
        I don’t recall what the terms were for TWTR but I do know my current employer prohibits using these shares as collateral for a loan, because you may default and be forced to sell them in the blackout period.
        thrown321 4y ago
        They can’t if you own them. Obviously the creditor can’t collect until the blackout is over but that can be written into the loan agreement. Those shares are your property. Insider trading is a sec thing, separate.
      - baskethead 4y ago
        Buying options is completely orthogonal to insider trading. Options contracts are not allowed because it's written in the employee contract and that's because companies don't want you to be engaging in stock activity that goes against the company. But not because it's illegal. If you're no longer an employee, you can buy whatever you want. If you have MNPI you can't buy or sell anything, including stocks or options, even if you don't work for the company.
      - tgsovlerkhgsel 4y ago
throw_nbvc1234 4y ago
If this merger wasn't going on twitter stock would be down XX% and so would their "emergency fund". Pretty sure i heard on a podcast that twitter has historically mirrored Meta stock so that's roughly a 50% drop. edit: over the past 6 months. so the duration of this process
throwaway5959 4y ago
Equity isn’t an emergency fund.
- hughesjj 4y ago
  Isn't and Shouldn't are different things. Also, new hires exist. Not everyone has had time to actually accumulate wealth from their compensation. Not everyone was taught financial literacy before being dumped into a high stress job. Not everyone is in good health. I think sympathy and compassion are fine ideals to hold for any of our working class cohort.
  - vorpalhex 4y ago
    I think treating our fellow humans like humans is more valuable than assuming they aren't capable of basic finance. Put another way, people will behave as you treat them. Treat them like they are fools who can't do finances and they will behave that way. Expect them to do basic financial behavior and they will. We literally make financial literacy courses free, online, without any need to even sign up. They will teach you what a bank is all the way up to 401k basics.
    - solardev 4y ago
      As someone who is financially illiterate, but doesn't have the time or knowhow to separate the good ones from all the spam out there... can you recommend any good courses?
      - vorpalhex 4y ago
        MoneySmart - the official government course that covers the basics: https://www.fdic.gov/resources/consumers/money-smart/teach-money-smart/money-smart-for-adults.html https://www.fdic.gov/resources/consumers/money-smart/teach-m... It's intended to be instructor led but all the resources are available on that page. It is not an overwhelmingly thrilling course but it will get you through the material. The PersonalFinance Wiki for the /r/PersonalFinance subreddit is actually very nice and covers a lot of common situations: https://www.reddit.com/r/personalfinance/wiki/commontopics https://www.reddit.com/r/personalfinance/wiki/commontopics Investopedia maintains an excellent and well written dictionary on financial terms, with a mix of articles. I use this website heavily: https://www.investopedia.com/financial-term-dictionary-4769738 https://www.investopedia.com/financial-term-dictionary-47697... They have a personal wealth section here: https://www.investopedia.com/personal-finance-4427760 https://www.investopedia.com/personal-finance-4427760 and a good place to start is: https://www.investopedia.com/articles/pf/09/financial-responsibility.asp https://www.investopedia.com/articles/pf/09/financial-respon... If you want a software aid, YNAB is pretty good and is based on a solid set of principles. https://www.youneedabudget.com/the-four-rules/ https://www.youneedabudget.com/the-four-rules/ Obviously lots of other options exist to manage your money and YNAB is not the only option, but it's a good one. If a resource suggests any kind of particular stock picks, crypto or other "investments", it's bad. It exists to sell you a product.
deleted 4y ago
[deleted]
jonas21 4y ago
This sounds like the standard blackout period that public companies have every quarter to prevent insider trading. If so, it'll be lifted a few days after TWTR reports Q2 earnings later this month.
- aatharuv 4y ago
  Things might be different because of Elon Musk's announced acquisition attempt of Twitter.
- HWR_14 4y ago
  It's been in place for 38 days so far.
aatharuv 4y ago
Your brick and mortar and online savings accounts are your savings account up to the maximum insurable amount. Your company stock is an investment that is part of your compensation. Your retirement account has (mostly) investments, at least in the US. Your brokerage account has investments investments. Any investment advisor will tell you that all investments have risk. There's an upside, and there's a downside to every stock. Anyone who remembers the Dot-com bust will remember that.

baskethead 4y ago

Once they leave the company they are free to sell the stock. They are not beholden to a stock blackout anymore.

onion2k 4y ago
That isn't how it works unfortunately. If the shares vest during the blackout period they're only released to the employee, or former employee, once the blackout ends. The employees can't sell these until the blackout is lifted. Currently there is no end date set.
- rconti 4y ago
  So this would only be an issue if they had no savings and had turned+burned all of their RSUs each pay period? (or, to be more charitable, just hit their 1 year cliff).
  - HWR_14 4y ago
    I think it's an issue if they had RSUs accumulated over N years and had not moved them to their brokerage account.
- notch656a 4y ago
  I would think someone would be happy to lend you the number of shares you have blacked out for a large fee, with a contract you release that to the lender afterwards. Something like "we lend you 75% face of your blackout shares now, in return we get all your blackout shares when they're released." Edit: Per below comment, don't do this :)
  - sokoloff 4y ago
    Most of these anti-insider trading policies prevent all of the obvious "one clever tricks" by prohibiting entering into options contracts, lending, borrowing, shorting, executing futures transactions, etc. If you could find someone to lend you cash (based on the totality of your financial situation and personal credit), that's fine. It's not fine to borrow someone else's shares and short them during a blackout.
    - thrown321 4y ago
      Regular folks are not insiders. You can certainly pledge collateral for a loan.
      - saagarjha 4y ago
        I don’t recall what the terms were for TWTR but I do know my current employer prohibits using these shares as collateral for a loan, because you may default and be forced to sell them in the blackout period.
        thrown321 4y ago
        They can’t if you own them. Obviously the creditor can’t collect until the blackout is over but that can be written into the loan agreement. Those shares are your property. Insider trading is a sec thing, separate.
    - baskethead 4y ago
      Buying options is completely orthogonal to insider trading. Options contracts are not allowed because it's written in the employee contract and that's because companies don't want you to be engaging in stock activity that goes against the company. But not because it's illegal. If you're no longer an employee, you can buy whatever you want. If you have MNPI you can't buy or sell anything, including stocks or options, even if you don't work for the company.
    - tgsovlerkhgsel 4y ago

throw_nbvc1234 4y ago

If this merger wasn't going on twitter stock would be down XX% and so would their "emergency fund". Pretty sure i heard on a podcast that twitter has historically mirrored Meta stock so that's roughly a 50% drop. edit: over the past 6 months. so the duration of this process

throwaway5959 4y ago

Equity isn’t an emergency fund.

hughesjj 4y ago
Isn't and Shouldn't are different things. Also, new hires exist. Not everyone has had time to actually accumulate wealth from their compensation. Not everyone was taught financial literacy before being dumped into a high stress job. Not everyone is in good health. I think sympathy and compassion are fine ideals to hold for any of our working class cohort.
- vorpalhex 4y ago
  I think treating our fellow humans like humans is more valuable than assuming they aren't capable of basic finance. Put another way, people will behave as you treat them. Treat them like they are fools who can't do finances and they will behave that way. Expect them to do basic financial behavior and they will. We literally make financial literacy courses free, online, without any need to even sign up. They will teach you what a bank is all the way up to 401k basics.
  - solardev 4y ago
    As someone who is financially illiterate, but doesn't have the time or knowhow to separate the good ones from all the spam out there... can you recommend any good courses?
    - vorpalhex 4y ago
      MoneySmart - the official government course that covers the basics: https://www.fdic.gov/resources/consumers/money-smart/teach-money-smart/money-smart-for-adults.html https://www.fdic.gov/resources/consumers/money-smart/teach-m... It's intended to be instructor led but all the resources are available on that page. It is not an overwhelmingly thrilling course but it will get you through the material. The PersonalFinance Wiki for the /r/PersonalFinance subreddit is actually very nice and covers a lot of common situations: https://www.reddit.com/r/personalfinance/wiki/commontopics https://www.reddit.com/r/personalfinance/wiki/commontopics Investopedia maintains an excellent and well written dictionary on financial terms, with a mix of articles. I use this website heavily: https://www.investopedia.com/financial-term-dictionary-4769738 https://www.investopedia.com/financial-term-dictionary-47697... They have a personal wealth section here: https://www.investopedia.com/personal-finance-4427760 https://www.investopedia.com/personal-finance-4427760 and a good place to start is: https://www.investopedia.com/articles/pf/09/financial-responsibility.asp https://www.investopedia.com/articles/pf/09/financial-respon... If you want a software aid, YNAB is pretty good and is based on a solid set of principles. https://www.youneedabudget.com/the-four-rules/ https://www.youneedabudget.com/the-four-rules/ Obviously lots of other options exist to manage your money and YNAB is not the only option, but it's a good one. If a resource suggests any kind of particular stock picks, crypto or other "investments", it's bad. It exists to sell you a product.

deleted 4y ago

[deleted]

jonas21 4y ago

This sounds like the standard blackout period that public companies have every quarter to prevent insider trading. If so, it'll be lifted a few days after TWTR reports Q2 earnings later this month.

aatharuv 4y ago
Things might be different because of Elon Musk's announced acquisition attempt of Twitter.
HWR_14 4y ago
It's been in place for 38 days so far.

aatharuv 4y ago

Your brick and mortar and online savings accounts are your savings account up to the maximum insurable amount. Your company stock is an investment that is part of your compensation. Your retirement account has (mostly) investments, at least in the US. Your brokerage account has investments investments. Any investment advisor will tell you that all investments have risk. There's an upside, and there's a downside to every stock. Anyone who remembers the Dot-com bust will remember that.