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Stock Options (Tech Companies)
Posted on 1/10/17 at 3:12 pm
Posted on 1/10/17 at 3:12 pm
If you were 28 years old and worked at a top tech company (Google, Facebook, Apple, etc) and part of your compensation package was $30k-$50k of company stock each year, what would your strategy be in terms of holding?
Would you:
-Sell your stock grants and put in Index Funds OR
- Hold the single tech stock with the hope of a massive long term gain
Common sense dictates not having more than a certain percentage in a single stock, but what about if you are young and have the upside of large long term gains if the tech stock outperforms the market as it has done historically?
Would you:
-Sell your stock grants and put in Index Funds OR
- Hold the single tech stock with the hope of a massive long term gain
Common sense dictates not having more than a certain percentage in a single stock, but what about if you are young and have the upside of large long term gains if the tech stock outperforms the market as it has done historically?
This post was edited on 1/10/17 at 3:13 pm
4
Posted on 1/10/17 at 3:37 pm to Lawyers_Guns_Money
i was in a similar situation. 27, started at a tech company with a good bit of options. And I still have options in a tech company although our stock sucks.
For the last 5 years, I execute my options and sell it immediately. This has worked out pretty well for me, but we get our company match in stock. So I am getting like $6k a year in company stock deposited in my 401k.
You could always split the difference and save half and sell half.
I was given a stock grant and I sold it as it vested. I was never particularly bullish on our opportunity as a growth stock.
For the last 5 years, I execute my options and sell it immediately. This has worked out pretty well for me, but we get our company match in stock. So I am getting like $6k a year in company stock deposited in my 401k.
You could always split the difference and save half and sell half.
I was given a stock grant and I sold it as it vested. I was never particularly bullish on our opportunity as a growth stock.
This post was edited on 1/10/17 at 3:40 pm
Posted on 1/10/17 at 4:17 pm to Hawkeye95
Thanks for the feedback. I think what you are saying is completely logical. Question though..If you worked for Google would you do the same?
Posted on 1/10/17 at 4:34 pm to Lawyers_Guns_Money
quote:
If you worked for Google would you do the same?
Good question, and the answer would probably sell half/keep half.
Posted on 1/10/17 at 6:21 pm to Hawkeye95
Depending on the amount, I might also look at a costless collar to protect a concentrated position.
Posted on 1/10/17 at 6:23 pm to Lawyers_Guns_Money
quote:
If you were 28 years old and worked at a top tech company (Google, Facebook, Apple, etc) and part of your compensation package was $30k-$50k of company stock each year, what would your strategy be in terms of holding?
Would you:
-Sell your stock grants and put in Index Funds OR
- Hold the single tech stock with the hope of a massive long term gain
Common sense dictates not having more than a certain percentage in a single stock, but what about if you are young and have the upside of large long term gains if the tech stock outperforms the market as it has done historically?
I think you also need to consider exposure with your job, not just your holdings; you've created a situation where if the company is struggling and you are worried about losing your job, you will also be poor...
I'm in O&G and I've tried to limit my holdings of the company I work for (and energy in general) for this reason, despite how appealing energy stocks can be.
Posted on 1/14/17 at 8:54 pm to Lawyers_Guns_Money
Been working for tech companies for 16 years now. I hold for 3-5 years and then sell. Haven't regretted it
Posted on 2/26/17 at 10:38 pm to Lawyers_Guns_Money
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