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Actually we followed the 10% rule for YEARS. And accumulated 100s of 1000s of dollars and saw it go POOF!!!. Now I go with the ZERO percent rule. The company is paying my salary. That's good. Let me go buy stock in other companies, through my funds of course.
I also agree with the zero percent rule. I owned my company stock back in the '70's and '80's when it was one of the only investment vehicles available to me in and outside of my 401k. It was doing great. A highly regarded blue chip company.
I was lucky enough to sell in the early '90's at a price in the $80-90 range. But I had a bunch of co-workers who held on as it dropped, thinking it had to turn around some time. That's what management was telling us. Some even started buying again as it reached $20, then $5. They were all forced to sell when the company filed for chapter 11. They received 25 cents f or every share in their 401k- no choice. It was a Kodak moment to remember.
Reply to @MikeM: The case of Kodak is an excellent example. Don't forget what happen to Enron, Worldcom and many other which have went out of business. If one owns no company stock, at least you are limited to merely the market exposure just like everyone else would.
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I was lucky enough to sell in the early '90's at a price in the $80-90 range. But I had a bunch of co-workers who held on as it dropped, thinking it had to turn around some time. That's what management was telling us. Some even started buying again as it reached $20, then $5. They were all forced to sell when the company filed for chapter 11. They received 25 cents f or every share in their 401k- no choice. It was a Kodak moment to remember.