Building something new | Ex-Leadership @ Zolve | Ex-Hedge Fund Investor | JP Morgan Alumni
I met a Google engineer last week. 60% of his net worth is in Google RSUs, and the stock hasn’t moved this year. Year-to-date growth? 0%. When I asked if he plans to sell, he said: “I’ll sell when it goes up.” I told him: “So your wealth strategy depends on hoping that one company moves faster?” We've all heard the saying 𝘏𝘰𝘱𝘦 𝘪𝘴 𝘯𝘰𝘵 𝘢 𝘴𝘵𝘳𝘢𝘵𝘦𝘨𝘺, 𝘴𝘱𝘦𝘤𝘪𝘢𝘭𝘭𝘺 𝘸𝘩𝘦𝘯 𝘺𝘰𝘶𝘳 𝘧𝘶𝘵𝘶𝘳𝘦 𝘥𝘦𝘱𝘦𝘯𝘥𝘴 𝘰𝘯 𝘪𝘵. He went silent. This is the trap most tech employees fall into: RSUs feel like free money, but they’re just salary you haven’t secured yet. When 60% of your net worth sits in one stock, you’re not investing—you’re betting. The smartest employees I know treat RSUs like cash-in-disguise. They sell, diversify, and stop checking the stock price 10 times a day. If your wealth depends entirely on your company’s quarterly earnings, do you really own it? #Google #RSUs #Diversification #Investing
very naive perspective. Many employees hold on to RSUs because they genuinely believe in the long-term potential of the companies they work for. That conviction has paid off massively in the past—think of those who held on to their NVIDIA, Microsoft, Amazon, or Meta stock early on. Sure, diversification matters, but dismissing concentrated conviction as mere “hope” overlooks the fact that’s exactly how many people built generational wealth in tech.
Autosale and reinvest 🍿🤝
I got my MSFT joining stock at 72 (Current 525) with many refreshers through my time there. I do not think I would have been able to do any investment this good even if I had the best finance managers sitting with me. So the answer is that it always depends, this advice cannot be absolute.
Fundamentally disagree with two points here 1. You are looking at a moment in time data for a publicly traded company which has grown 153% in the last 5 years. You’v chosen a period where Nifty has moved 4.56% YTD and sure there will be stocks that have moved 0% I could look at the last 3 months and say the same share has gone up 16% (but then I won’t have a profound sounding LinkedIn post) 2. Converting these to actual cash takes less than 3 days. So this investment is not notional. For most tech industry folks, this is accumulation of wealth on the side and they use disposable income to invest elsewhere The only part that adds up is 60% exposure to one asset class is a tad risky - and that’s true for ANY asset class.
Shivang Badaya I realize you have a noble reason at heart, but you won't achieve it by bashing RSUs of a FAANG. Just saying.
Absolutely Shivang Badaya the portfolio must be diversified to reduce concentration risk but the embedded capital gains tax is also a consideration
I think you have to differentiate between what the person „needs“ for the living (I am with you, diversifying that is necessary) and what comes on top. Probably the person‘s salary is high enough for living AND saving, and the RSUs on top are nothing that the person has to rely on to pay rent, mortgage etc. If that would be the case, then the strategy would have to be changed.
Mark Cuban and collars come to mind. Problem is most companies don't allow employees to use options on company stock.
I can relate to this. The majority of my portfolio is also in Google stock. I invest in what I believe in, and for me, that's Google, a belief I held even before I joined the company. While some people prefer to diversify into real estate or other assets, I've seen wealth grow significantly from a single asset and also seen people lose money despite diversifying. For me, this isn't a gamble. I've accepted the risk and wouldn't regret it if the stock lost value. In fact, given the company's long-term potential, I plan to invest even more in Google over the next few years.
UI Engineer II @ Flipkart
2moI would have answered, "I am working to make my company grow and I have faith in my team's and my work that the numbers will go up." Because why would you work somewhere if you think their numbers can't go up. If you feel like selling those RSUs, you should also probably join somewhere where you believe growth can happen.