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Thread: Company Shares

  1. #1
    DF Jedi BigBrand's Avatar
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    Default Company Shares

    Each year my company offers a share save scheme for 3 or 5 years, with an option price around 20% lower than current market price.

    I have a 2018 5 year scheme, which I contribute 25 per month into, the option price was 3.84. Meaning over 5 years, I will have saved 1,500.

    I can then buy 1,500 worth of shares at 3.84, which is c390 shares - or if the share price in 5 years drops below 3.84 I can take my money back, risk free.

    2019 Share shave scheme has given us an option price of 2.86, meaning if I signed up for another 25 per month contribution, I would again have saved 1,500 over 5 years, but at the end I would be able to buy 1,500 shares at 2.86, c524 shares, a difference of 134 shares.

    At current share price of 4, the 2018 share save scheme would mean my shares are worth 1,560 (60 profit)
    At current share price of 4, the 2019 share save scheme would mean my shares are worth 2,096 (596 profit).

    My question there is, with the 2019 option price being far more attractive, is it a considerationt to pull my money out of the 2018 scheme 300, and place that, plus the ongoing 25 contribution, into the 2019 scheme. This would mean I would put 50 per month + 300 from the first year of 2018.

    As the two schemes together, if the price were to stay at 4, in 6 years when both plans mature, I would have invested 3,000, and made 656 profit.

    Where as, if I invested 50 per month over the the next 5 years scheme, I would have invested 3,000, and would be able to buy c1048 shares on maturity.

    Which, if we take 4 per share as an example, would be worth 4,195, a profit of 1,195, almost double what the 2018 and 2019 schemes would be together after a similar period.

    Obviously, I can't rely on any share price being anything, with brexit, the tensions in Iran and the US, so nothing is a given. Guess I need to decide if I wait another year for one to mature, and potentially double my money. If the price rises over 4, I'd be going above doubling my money.

    What are your thoughts?

  2. #2
    DF Jedi Zippeyrude's Avatar
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    Default Re: Company Shares

    fuck me is this a maths test?

    2 Thanks given to Zippeyrude

    BigBrand (4 Weeks Ago), ivrytwr3 (4 Weeks Ago) 


  3. #3
    DF Jedi BigBrand's Avatar
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    Default Re: Company Shares

    Quote Originally Posted by Zippeyrude View Post
    fuck me is this a maths test?
    Feels like it pal!

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    DF Jedi hoponbaby's Avatar
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    Default Re: Company Shares

    Makes sense if the scheme rules allow you to do so - although you may be able to stop contributing in to the 2018 scheme and then double the investment in to the 2019 scheme ongoing they may not let you have the 300 back until maturity.

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    DF Jedi BigBrand's Avatar
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    Default Re: Company Shares

    Thanks!

    I've taken the action to remove from the 2018 scheme. Taking the 250 it is, and then staggering, doing a 3 year and a 5 year scheme.

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    Default Re: Company Shares

    I did this a few times. The one that should have been the best was a seven year deal which was save for five and then wait two more years before the option was available. After five years it would have been worth over 20k, when I could take the option only two years later it wasn't worth converting to shares so I had just over 12.5k back including the interest. Wank eh. Helped me save though.
    No sympathy for the devil; keep that in mind. Buy the ticket, take the ride...

    Thanks to beansontoast

    BigBrand (4 Weeks Ago) 


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    DF Jedi BigBrand's Avatar
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    Default Re: Company Shares

    Offh that's grim!

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