Fifth Avenue Forum

Posted: **Fri Feb 16, 2018 3:23 pm**

I don't know whether you have to be truly associated with any university to be able to register for this FREE webinar, but in any case (I just got an email about this today):

"The Middle Market" by Dr. Anil K. Makhija
Description
The Middle Market: Definition, Role, and Challenges

Speaker: Dr. Anil K. Makhija, Dean of Fisher College of Business and John W. Berry, Sr. Chair in Business of The Ohio State University.

While small and large firms legitimately garner attention, middle-sized firms go unnoticed though they are highly significant contributors to the economy in the U. S. and abroad. We define the U. S. middle-market sector, and note its uniqueness relative to small and large firms. In particular, middle market firms face challenges that are different from those of others. As an example, we review the globalization of middle market firms. We also note other challenges faced by this sector.
Time

Feb 22, 2018 3:00 PM in Eastern Time (US and Canada)

Registration: https://zoom.us/webinar/register/WN_FO3 ... Hy_gPpq1Kw

Incidentally, Anil is my close friend and mentor (he chaired my dissertation 20 years ago and my publications with him during my early years resulted in me being a *tenured* professor now). So I *KNOW* he is damn good (despite working for the Evil Empire of Ohio now...

) .

Posted: **Fri Feb 16, 2018 3:24 pm**

I don’t care about your diploma.

Posted: **Fri Feb 16, 2018 3:29 pm**

Rough.

Posted: **Fri Feb 16, 2018 3:36 pm**

THIS AINT SOME SAFE SPACE, BUDDY

Posted: **Fri Feb 16, 2018 3:41 pm**

THIS AINT SOME SAFE SPACE, BUDDY

Your commentary from last night indicated you are in dire need of one...

Posted: **Fri Feb 16, 2018 10:04 pm**

Rough.

Had you not activated the built in filter (which was a laudable move), you’d have caught the reference.

Posted: **Wed Mar 14, 2018 10:29 am**

I have a question.

I have non-qualified stock options. 300 shares - 100 vested (100 more vest each december for the next 2 decembers)

When I exercise the option... what does that mean?
When I sell the stock, that's different, right?

Let's say I wanted to liquidate them today (I don't, but just for example). My exercise price is $25. The stock is currently trading at $50. Do I exercise 100 options and receive $2500? Or do I receive 100 shares @ $50... then either turn around and sell them and make a $2500 profit taxed on ST Capital Gains rates... or hold them for another year, when they go down to $40 a share... and sell and only make $1500?

Just trying to figure out what the best way to do this is?

Posted: **Wed Mar 14, 2018 10:56 am**

I have a question.

I have non-qualified stock options. 300 shares - 100 vested (100 more vest each december for the next 2 decembers)

When I exercise the option... what does that mean?
When I sell the stock, that's different, right?

Let's say I wanted to liquidate them today (I don't, but just for example). My exercise price is $25. The stock is currently trading at $50. Do I exercise 100 options and receive $2500? Or do I receive 100 shares @ $50... then either turn around and sell them and make a $2500 profit taxed on ST Capital Gains rates... or hold them for another year, when they go down to $40 a share... and sell and only make $1500?

Just trying to figure out what the best way to do this is?

https://www.investopedia.com/terms/n/nso.asp
and more importantly,
https://www.investopedia.com/articles/o ... oabout.asp

Plus an unsolicited pointless advice:

It can be proven that (a) unless you KNOW the stock price will move down in the future and/or (b) unless your stock pays a massive dividends and/or (c) your personal tax bracket will be greater in the future, all options should be held until expiration. That is, the exercise should happen at the last possible day, because the "intrinsic value" of the option with some life left is always higher than the profit from exercising it.

Posted: **Wed Mar 14, 2018 11:25 am**

So once I 'exercise' do i basically 'purchase' the stock at the 'exercise' price? And then, the capital gains tax rules take effect?

Posted: **Wed Mar 14, 2018 11:45 am**

So once I 'exercise' do i basically 'purchase' the stock at the 'exercise' price? And then, the capital gains tax rules take effect?

The first sentence is 100% correct (that's how options work).

As far as I understand taxation: {I'll rename the "Exercise price" as "Strike price" }

(a) upon exercise, you pay ordinary income tax on the gain (the difference between market price on the day of exercise and the strike price.
(b) after that, you pay capital gain (ST, LT based on when you sell the shares) with respect to the market price on the day of exercise

Oh, and the pointless advice No. 2:

It can be proven that holding individual shares (AND ESPECIALLY shares of your own company) is not optimal (unless you have private - thus likely illegal - info that the stock is undervalued currently). So, after you exercise the options, the stocks should be immediately sold.

Posted: **Wed Mar 14, 2018 11:55 am**

It can be proven that holding individual shares (AND ESPECIALLY shares of your own company) is not optimal (unless you have private - thus likely illegal - info that the stock is undervalued currently). So, after you exercise the options, the stocks should be immediately sold.

agreed. I'm assuming Thomas is suggesting that mac put this $$$ into an index fund but imo mac should use it to have non bumpy walls

Posted: **Wed Mar 14, 2018 11:59 am**

They are shares of my own company with 10 year exercise. So I should wait 10 years... exercise, and sell off right away? Would I pay STCG (assuming it's a thing then still)?

Posted: **Wed Mar 14, 2018 12:00 pm**

It can be proven that holding individual shares (AND ESPECIALLY shares of your own company) is not optimal (unless you have private - thus likely illegal - info that the stock is undervalued currently). So, after you exercise the options, the stocks should be immediately sold.
agreed. I'm assuming Thomas is suggesting that mac put this $$$ into an index fund but imo mac should use it to have non bumpy walls

mac was going to use it for a nice garage to keep away from mrs mac and our impeding colony of children.

Posted: **Thu Mar 15, 2018 10:03 am**

This is glorious in every way.

Posted: **Sat Mar 17, 2018 2:45 pm**

@dodint

TSP functions like a 401k for you? Recent news indicates that being in a pension system isn’t ideal....

Posted: **Sat Mar 17, 2018 2:51 pm**

My federal retirement is three-pronged:
TSP acts as a 401k.
Basic Benefit pension; annuity based on high-3, creditable years, etc etc.
Social Security; mehhhhhhhhhhhhhhhhhhhhh

Posted: **Sat Mar 17, 2018 2:54 pm**

I took all of my money with me, when I left my state gov. job. That fund is waaaaaaasy underfunded now.

Surprised they don’t give you the option to go all 401kish. Then again, government ish...

Posted: **Sat Mar 17, 2018 3:07 pm**

My earnings statement has a box showing what I've paid into the BB pension. It's a bummer because there is no guarantee I'll realistically ever see it. And I can't get it back. The only thing I have going for me is once I make it to 5 years I'm entitled to a pension, I don't have to do the full 20 to get it. It would be a small one for sure but at least I'm not bound to this place if I do decide to leave for the private sector.

I'm not sure how many years I've been a federal employee. It'll either be 4 or 10 years in November depending on the purpose you're counting for.

Posted: **Sat Mar 17, 2018 3:08 pm**

I would think that military service would be tacked on to your current run. No?

Posted: **Sat Mar 17, 2018 3:11 pm**

I worked a guy, who was about to retire and he was going into following phase:

Military (20 years) pension
Government (20 years at NSA) pension
State government (5 years) pension
Social security
IRA

Talk about a sweet set up

Posted: **Sat Mar 17, 2018 3:16 pm**

Yeah, I bought back the 68 months I served. That's the 4-10 gap. I had to pay 3% of my military base pay earnings to do so. It came to about $4500 or something, I just have $30 taken out of each check since it's interest free.

For the purposes of leave accrual and seniority my career 'started' in 2008. But until I'm finished paying off that deposit it actually started sometime in 2014 for purposes of retirement.

I don't remember the specifics right now because it's so distant, but the effect of buying back my time doesn't necessarily mean that I can retire with a full pension sooner, but that when I do cross that minimum threshold I'll already be a higher tier.

Posted: **Sat Mar 31, 2018 12:13 pm**

Much discussion since the first of the year wondering if the era of passive investing has run it's course. Has this become a stock pickers market?

Based on the most recent closing prices on March 29th, since March 30th the markets were closed.
$10,0000 to invest, where would you put it?

Benchmark:
SPY 38@263.15 = $9,997.00 ( leaving almost enough for a commission)

My choices:
Long SOXL 50@152.82 = $7,641.00
Short CMG 7@323.15 = $2,262.05
Cash $96.95 (Let's call it $85 after commission)

Posted: **Sun Apr 01, 2018 12:55 pm**

Source of the post Much discussion since the first of the year wondering if the era of passive investing has run it's course.

I've seen a few of these articles by people who nobody has ever heard of before. I don't think index investing is coming to an end, especially given that more and more people turn to it every single year.

Posted: **Sun Apr 01, 2018 2:28 pm**

Source of the post Much discussion since the first of the year wondering if the era of passive investing has run it's course.
I've seen a few of these articles by people who nobody has ever heard of before. I don't think index investing is coming to an end, especially given that more and more people turn to it every single year.

There's a difference between popular and successful.

Posted: **Sun Apr 01, 2018 2:46 pm**

Source of the post Much discussion since the first of the year wondering if the era of passive investing has run it's course.
I've seen a few of these articles by people who nobody has ever heard of before. I don't think index investing is coming to an end, especially given that more and more people turn to it every single year.
There's a difference between popular and successful.

And being one doesn’t preclude you from also being the other. Index investing is becoming more popular because of its proven success over a very, very long time period. It’s not going away anytime soon.

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