Hi Shel10 - thanks for the explanation. While it is entirely possible, my take [which is subjective] is that employees' exercise is neither profit taking nor tax loss. Just selling what are rightfully theirs. However, if that was your viewpoint, we could agree to disagree :).
Actually, think about it, if they can exercise, there are brokerages out there willing to exercise and selling a portion of it for them. So they don't really have to borrow any money at all, except maybe a margin charge.
Anyway, you open my eyes to a different world. Even though I ve a habit of playing risky investing <G>, I ve never like to spend more than I could earn. These folks, who would sell their stock holdings for X'mas gifts, should really take a course or two in financial management. Exercising is fine, but selling will incur taxes. Of course, eventually, they will have to cash out, so I guess they each have their own circumstance.
best, Bosco |
