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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host

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To: Rock Fish who wrote (3661)2/26/1998 2:47:00 PM
From: Boca_PETE  Read Replies (1) of 42834
 
RockF: re:<You have to know when and when not to ignore the 4% rule>

Your point hits the nail right on the head. Employees of Microsoft and other similar fast growing tech and non-tech companies with a future you can bank on would want to ignore the 4% rule for company stock or options they get during the course of their employment.

On the other hand, employees of rust belt manufacturing concerns and oil companies whose stock price closely correlates with the volatile price of crude oil would want to move toward complying with the 4% rule. Last April, I got the chance to diversify 25% of my shares in my employer. My employer's shares were only up 12% for 1997. The VANGUARD PrimeCap shares I transferred into last April 1 were up over 40% during 1997 from that date. Wow, what a difference to my 401K plan ! The prospects for the company you work for are key.

P

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