When is the best time to sell your recent options? How do you know if your strategy is the right one for you, with the right level of risk? With so many Silicon Valley companies going public these days, it’s important for employees to have an investment strategy that meets their risk levels in addition to delivering on their financial goals. Getting the right advice & management of your portfolio from experts who are well versed with IPO performance and investment strategies can make all the difference to your future.
Wealthfront, a company led by Andy Rachleff (co-founder of Benchmark Capital) is at the forefront of helping employees make the most of their IPO & stock options. The Palo Alto based investment company, Wealthfront, hosts a team of financial gurus specializing in Post-IPO trends and analysis. This gives them a knowledgeable edge, versus other types of financial advisors, when it comes to managing your hard earned tech options. Employees from Facebook and other tech companies can now build a personalized financial plan (based on your personal goals and varying levels of risk) with confidence.
Their website has a range of intelligent tools to help assess your level of risk and assist you in understanding what investment strategy works the best for you (i.e. do you sell everything Post-IPO, or do you hold out for a longer term and sell a portion every quarter).
An additional tool is the “Post-IPO stock sale simulator”. This simulator is user-friendly and can easily show you how your potential net worth could play out. The simulator highlights companies including Google, Salesforce, Orbitz, NetFlix, VMWare and others and provides an option for you to select another company to model (if you are interested in one that is not listed). Wealthfront has years of performance data of over 2000 Post-IPO’s to guide their management strategies.
The example below shows how a Google employee who opted to not sell any stock since the company went public would be doing pretty well now; versus if she/he had opted to sell all of their options immediately post-lock up (which is usually around 6 months after the IPO).
While no one can predict the future, a company like Wealthfront, who specializes in Post-IPO performance, can substantially maximize your awareness of the best potential options available. Their scenarios show how companies have performed in the past and this can help deliver key insights relating to your investment strategies. Investing with them is easy and affordable. Investments below $25K have no advisory fees and investments over $25K only incur a small fee of 0.25% which is incredibly reasonable.
Check them out for your own personalized investment strategy at www.wealthfront.com/