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What should you do with stock options during a recession?

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Re: What should you do with stock options during a recession?

#21

Post by adamsmith143 »

JonChesterfield wrote: post #8
johnchristopher wrote: post #2

I'd like to know what to do with ~10 000 euros, right now. Where should I put it so it doesn't lose its value and keep a bit with inflation ? edit for a bit of context: Western Europe, renting, unlikely to be able to buy/invest into a house/flat, looking at gold ingots, not the nerve for crypto.

Buy something you want for 20000 and watch the debt inflate away?

This always seems silly to me. You are making an assumption that your Income will inflate by the same amount. But I don't know anyone getting 8% raises each year in any industry.

Re: What should you do with stock options during a recession?

#22

Post by FinanceAnon »

johnchristopher wrote: post #2

I'd like to know what to do with ~10 000 euros, right now. Where should I put it so it doesn't lose its value and keep a bit with inflation ? edit for a bit of context: Western Europe, renting, unlikely to be able to buy/invest into a house/flat, looking at gold ingots, not the nerve for crypto.

I would just hold it - I have sold most of my index fund holdings in the past 6-9 months and been just holding cash. I don't think stocks have reached the bottom yet, so holding cash at 0% return is still better than negative returns from stocks. Right now, it's about not taking losses. I also don't see the market and economy rebounding quickly after reaching bottom - they will stay flat for a while IMHO

Re: What should you do with stock options during a recession?

#23

Post by anon291 »

I'm planning on exercising some of mine (in the post-resignation 90 day period) via EquityBee. I don't want to lower my own cash reserves now due to a looming recession, but do believe the company has upside. EquityBee (and a few other companies, like vested, all of whom I think are legitimate) gives me money to exercise the options in exchange for ~30% of the shares should the company go public, plus repayment of the original loan. It's a win-win for me. The worst outcome is I make no money; the best is that I keep 70% of my shares without paying for them. They even pay AMT.

Re: What should you do with stock options during a recession?

#24

Post by quesera »

jonas21 wrote: post #18
notch656a wrote: post #14

Earlier quoted context omitted.

It's probably not worth the trouble, but I think anyone can start a US LLC and use the tax identification of that business to buy I-bonds.

No, only individuals can buy I-bonds. EDIT: that's not right. please see below.

This is not correct.

Individuals can buy $10K/yr. Married couples can each buy $10K/yr, and you can buy the same amount for children.

Also, businesses can buy $10K/yr, trusts can buy $10K/yr, and you can purchase $5K/yr with a tax refund.

It would be not unusual to be able to buy $45K/yr (4-person household), and if one of the family is self-employed, $55K/yr.

....

That said, don't buy lots of I bonds without first considering the advantages of TIPS!

Re: What should you do with stock options during a recession?

#26

Post by senko »

johnchristopher wrote: post #2

I'd like to know what to do with ~10 000 euros, right now. Where should I put it so it doesn't lose its value and keep a bit with inflation ? edit for a bit of context: Western Europe, renting, unlikely to be able to buy/invest into a house/flat, looking at gold ingots, not the nerve for crypto.

Go through the videos in Plain Bagel and Common Sense Investing (Ben Felix) YouTube channels, then read, read the sidebar in r/eupersonalfinance subreddit, and that will give you solid foundational knowledge and context for figuring out what's best for you.

Re: What should you do with stock options during a recession?

#27

Post by jcdavis »

TrainedMonkey wrote: post #25
jcdavis wrote: post #20

Yet another reason not to join any startup that still does 90 day option expiration.

In US 90 day option expiration is required by law for ISOs which have favorable tax treatment.

Yes, but grants that convert to NSOs after departure are possible. Worse from a taxation perspective, but better than losing them.

Re: What should you do with stock options during a recession?

#29

Post by wollsmoth »

johnchristopher wrote: post #2

I'd like to know what to do with ~10 000 euros, right now. Where should I put it so it doesn't lose its value and keep a bit with inflation ? edit for a bit of context: Western Europe, renting, unlikely to be able to buy/invest into a house/flat, looking at gold ingots, not the nerve for crypto.

I'm not sure if you can buy ibonds but those seem good for up to 10k usd.

Otherwise, Either a targetdate fund, I use VFIFX which should give most benefits of a bull market while giving some cushion due to its diversification.

Or, just a nice total market index fund should be a good option. It may drop a bit but it's as diversified as it gets. I use FZROX, but there are many others.

Re: What should you do with stock options during a recession?

#30

Post by ushakov »

FinanceAnon wrote: post #22
johnchristopher wrote: post #2

I'd like to know what to do with ~10 000 euros, right now. Where should I put it so it doesn't lose its value and keep a bit with inflation ? edit for a bit of context: Western Europe, renting, unlikely to be able to buy/invest into a house/flat, looking at gold ingots, not the nerve for crypto.

I would just hold it - I have sold most of my index fund holdings in the past 6-9 months and been just holding cash. I don't think stocks have reached the bottom yet, so holding cash at 0% return is still better than negative returns from stocks. Right now, it's about not taking losses. I also don't see the market and economy rebounding quickly after reaching bottom - they will stay flat for a while IMHO

> holding cash at 0%

as consumer prices are surging this no longer may be true

my bet is on physical assets: guitars, gold, watches

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