[quote=sdrealtor]Whats funny is he thinks the workers all hold onto the stock in the companies they work for. Pretty much all the guys I know that work for the big tech companies sell their RSU’s as soon as they can. They are smart enough to understand they are fully invested in the company with their jobs so they cash out regularly. I guess someone not in that position might not know that
Gotta work on some market updates[/quote]
Well, when companies didn’t care as much before and didn’t have as many restrictive insider stock policies…There was a lot more to just selling RSU stock or exercising and selling ISO stock options.
When my B2B software company that priced at $30/share and IPOed at $217/share, there were lockup windows that prevented people from selling for employees. So for those that have vested stock options, many quit to be able to exercise and sell.
In other cases, those of us that had unvested stock option grants that were concerned the stock price would fall by the time we fully vested…went on the retail market to buy a lot out-of-money short term PUT options when the stock price hit $350/share a few weeks later as a insurance against a falling stock price on unvested ISO stock options…just in case there wass a correction…The slightly out-of-money put options were dirt cheap, just a few thousand…And some of them expired worthless, but when the stock corrected from $350/back to $150, they were cheap insurance to lock in value for unvested shares. Profits from that correction went into additional slightly out-of-money PUT options, and then when the stock price corrected to $50, those PUT options were worth a lot of money…
So in a lot of ways, it was better what happened. Because if the stock price stayed high, we would have had to stay working all 4 years to 100% vest and cash in on the IPO. But since the stock price corrected, we pretty much collected the same amount of money had we vested 4 years, except we could leave the company any time for another opportunity since the PUT options bought as insurance was work a heck of a lot more money than the original ISO stock option grants…
Since then, most companies have insider policies that specifically state employees are not allowed to purchase derivative equities of the company….(so no more put or call options for employees)…
Then again, moving to Broadcom, they were involved in the stock option backdating scandal, so so much for ethics at that company, lololol. But man, Broadcom was a fine ride up until it was Hock-sized.
With the exception of leaving Qualcomm in the mid 90ies, which was a big financial mistake.. I have to say, moving around to collect the stock grants was definitely a better financial decision then staying stuck at a company year after year because the largest grants were always at the time of employment signing…It’s just how it works. I’m just too old and lazy to do it anymore. I just lost a frontend web engineer to microsoft last week. He’ll be making roughly what I am currently making… So the hiring craziness continues…
