Go to Jeff Salisbury LWGate Home Page.From: "Tom Worley" <stkguru@netside.net>
Subject: Re: [CANSLIM] Arthur Andersen... more OT.
Date: Sun, 20 Jan 2002 21:15:40 -0500
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Bill, You provide a personal and very direct example of why a total prohibition against company stock in a 401K plan is needed. There will otherwise always be companies that will try to "match" using stock they just issued, instead of real money. These kinds of restrictions are a red flag in and of themselves. An employee already has a lot invested in a company by virtue of his or her salary. It is asking too much to also require that they put their retirement dollars into company stock. If they are convinced that the stock is a great investment, they can always buy some on the open market. But their retirement account needs some independence, and distance. This is much like an executive that takes part of the compensation in the form of stock options. Exercising those options is fine, as it permits diversification. It is not safe, smart or sensible to have all of ones eggs in the same basket. Tom Worley stkguru@netside.net AIM: TexWorley - ----- Original Message ----- From: "Bill Triffet" <btriffet@earthlink.net> To: <canslim@lists.xmission.com> Sent: Sunday, January 20, 2002 6:24 PM Subject: Re: [CANSLIM] Arthur Andersen... more OT. > > ----- Original Message ----- > From: "Robert Gammon" <rgammon51@yahoo.com> > To: <canslim@lists.xmission.com> > Sent: Sunday, January 20, 2002 6:05 AM > Subject: Re: [CANSLIM] Arthur Andersen > > > > I don't expect to see an outright prohibition of stock ownership in > 401(k)s. One > > possible compromise that I envision is a new requirement for 401(k) plan > > administrators. Under this proposal, the 401(k) plan administrators would > be > > required to send periodic notices to employees whose stock holdings > amounted to more > > than XX% of the employee's 401(k) plan value. ??Periodic?? == quarterly, > monthly, > > weekly, daily, frequency COULD be made dependent on the percentage that > the company > > stock represented of account value. A list of employees whose holdings > are above the > > magic percentage number should be given to CEO/CFO. > > One point many folks miss is stock ownership is a requirement in many > companys where there is a company paid matching amount. > > For instance, I worked for a privately held medical company a few years back > that matched up to 4% of your salary to the 401(k) plan. It was a plan with > many investment options. They were then bought out by St Jude Medical. > Starting that year, they only contributed to the plan in the form of St Jude > stock. You also were required to buy St Jude stock with as least 50% of your > personal contribution in order to get the match! > > I then went to a Textron company. Same deal. I had to assign a minimum 50% > of my personal contribution in order to receive a matching amount - that was > only offered as Textron stock. ( this was at a time that TXT was headed down > fast). > > In both cases. one could not transfer any funds out of the company stock > into say money markets or mutual funds while an employee. This is the REAL > problem with company stock ownership. > > -Bill Triffet > > > > - > -To subscribe/unsubscribe, email "majordomo@xmission.com" > -In the email body, write "subscribe canslim" or > -"unsubscribe canslim". Do not use quotes in your email. > > - - - -To subscribe/unsubscribe, email "majordomo@xmission.com" - -In the email body, write "subscribe canslim" or - -"unsubscribe canslim". Do not use quotes in your email.
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