OK, here’s the story. I work for a company called Newport News Shipbuilding, the nation’s only builder of nuclear aircraft carriers. Not that that’s important. What’s important is that in 1996, they began trading on the New York Stock Exchange (before then, they were a subsidiary of Tenneco, Inc.). Their stock opened at about $16 a share, and employees were (still are, actually) allowed to buy the stock at a 15% discount. “Come on and hop aboard”, management said. “Invest in your future!”
Being a cynical, in-the-know shipyard guy with no tolerance for all that happy talk, my inner voice says: “Are you shitting me? The way this company is run? They’ll be lucky if the stock breaks twenty bucks!!” A little while later, it breaks twenty bucks. “There’s no way it’ll go much higher.” Twenty-five. “Uhh… I’m still skeptical.” Thirty. And so on. A couple of days ago, General Dynamics offered to buy the company for $67.50 a share. NNS stock closed Friday afternoon at $64.72.
It gets better. In 1998, the yard gave all of its hourly employees 100 stock options at a purchase price of $24.875; IOW, I would get the difference between $24.875 and whatever the stock price was when I cashed the options. I cashed them last summer when the stock was around $33 (I needed some quick money). I made about $850 befor taxes & fees. If I’d waited until Friday I would have made $4260.
::short pause for intake of breath::
GOD DAMN IT!!! I am so frigging felching fucking stupid! I have the financial instincts of a goose turd. The monetary know-how of a used rubber. The fiscal wherewithal of an educationally disadvantaged blowfly (OK, I’m not so good with the insults, either). Why do I listen to my inner voice when it’s obvious he’s been eating lead paint chips?
I’ve mentioned this to my friends and they just point and laugh at me. Humiliation isn’t good enough, though. I deserve punishment for this, dammit. Severe punishment.
The first thing to do is calm down and realize that everyone misses out on some good investment opportunities. Warren Buffet owns no Microsoft shares. The Long Term Capital mess laid barren the fortunes of two Nobel winners in economics, and I missed Newport News.
Yep. I’m a professional investor, and when NN came out of Tenneco, I met with management, toured the facility, reviewed the order book and looked at the Navies of the world to see if there was good export opportunities. Saw the Ronald Reagen when it was barely a keel.
And I missed it. I thought the stock was a little expensive. I was wrong. You were wrong. Get over it.
The next thing to do is to make up for it. How much stock (honestly) would you have bought if you had done the trade. How much money would you have made on it? Add that to the ~3,400 “lost” profit on your options.
Now, did you save elsewhere that amount of money in the meantime? Because that’s your new near-term goal. If you haven’t been saving money, than you have a bigger problem than missing out on one stock. You should set up a financial plan that allows you to save your “lost” amount as quickly as practical given your income and living expenses. Oftentimes, it is exactly an event like this that gives people the kick in the pants they need to start saving seriously for the future.
Good luck, and stop beating yourself up. You’ll miss better opportunities than this one!
Been there. A few years back, I was eager to get into Apple, because their stock had fallen close to its all-time low, and I knew the company had nowhere to go but up. So, I put the machinery in motion to cash in my mutual fund so that I could reinvest the money in Apple.
I was waiting for the check to arrive when the news came in that Microsoft had bought $150 million of Apple stock, driving the price from $17 to $50 per share. My $4000 investment, had I made it in time, would have brought me about $12,000 in one day. Dammit dammit dammit.
manhattan:
Hey, thanks. The Pit is not where I would have expected to get sound financial advice, but I guess I need advice anywhere I can get it. Part of my irritation stems from the fact that for the last few months everyone I know has been asking me “Man, I see that shipyard stock’s goin’ up. How much you makin’?” Ugh.
And no, I haven’t saved anywhere near the amount of money that my missed opportunity “cost” me. In a world of ants, I am a big fat stupid-ass grasshopper. I’m a single guy with a decent job, and right now I’m counting the days until my tax refund shows up so I can get some new contact lenses (Christ, now that I actually look at those words typed on the screen, I feel really fucking pathetic). Maybe this latest episode will finally make me change my ways.
Mercutio:
Thank you sir, may I have another? My drink of choice is tequila, but I’ll be taking your advice as well.
Don’t feel too bad, I know a lot of Dot-commers who got hit real bad. Here’s my personal story. I started working for a company two years ago. The base pay was lower than the other offers, but they offered a shitload of options, unfortunately they had a two year vesting time. In that first year, my my company got caught up in the tech upswing, and went through the roof. Around last March, my options would have been worth about $400K, and I had visions of retiring at 30. Then the big tech crash hit. By the time my options vested the company was below the strike price. ( Although as of this Friday they were worth $520 if execised ) All in all though the fact that I still have a job puts me better than a lot of people I know.
I would’ve probably been able to buy the house I now live in for cash if I had the profit from all my missed opportunities.
My biggest boner was not buying at the insider’s price an apartment I rented when it was being converted to condos. The insider’s price was absurdly low, but I thought the place was such a dump I couldn’t even see paying that for it.
A few years later, it was worth five times the insider’s price. One buddy of mine almost stopped talking to me when he found out I hadn’t bought he thought I was so brain-dead.
Maybe he was right.
Two stories of pure luck, neither of which paid off.
I was 13 when Gold went back on the international market as a commodity. I BEGGGGGGED my father to take my Bar Mitzvah gift money and get all the gold he could with it, on opening day. He asked why ( he’s a fairly savvy investor). I said, " Everyone wants to own gold, and has for centuries, the price will skyrocket". He gave me a bemused smile. Gold opened at $ 35.00 the troy ounce.
When gold hit 600.00 an ounce ( and, it did at one point ), he admitted to me that he'd missed a huge chance. I'll never forgive him for it. I had been given a total of about 8,500.00 in gift monies. That was about 242 ounces on Opening Day. If sold for 600.00 an ounce, he would have grossed 136,000. After fees and initial investment, it would have been about $ 120 G’s. Fuck
I was both a fan of filmmaking AND a HUGE Star Trek fan as a kid. When Paramount Pictures announced that “Star Trek: The Motion Picture” was going to be shot, I sagely informed Daddy that Gulf & Western stock would skyrocket. ( G&W owned Paramount Pictures at the time). On what did I base THIS? Heck, Twentieth Century-Fox stock went insane after “Star Wars” was released. ( Actually, it took a while to realize but the stock did increase significantly). I told him that “STTMP” would clean up, and Paramount would make a fortune.
Daddy tried valiantly to tell me that Paramount was one SMALL unit of G&W. I persisted. He indulged me. He bought me TEN SHARES of G&W before “STTMP” was released, and 100 shares for himself. Just in case…
He sold it a few years later, at a decent profit. “STTMP” didn’t do what I thought it would, but G&W stock overall was doing nicely. He sold when he felt he ought to unload it, and I got some pittance in profits. In the years since? It went WAYYYYY up.
As mentioned up there somewhere, 20/20 hindsight is a lovely thing. Don’t beat yourself up. You trusted your instincts as an employee who knows how the business WORKS. Don’t doubt those instincts, I bet 9 out of 10 times, they prove to be on the mark.
Mock me if you will:) Its still better than wasting your time over missed opportunities. The ability to consistently make money off the stock market is much more useful than getting lucky once.
I had some good luck with stock, actually. I had 250 shares in the company I work for I was ready to sell. I would have got about $5000 for it. I asked a friend of mine to fax in the forms for me, I didn’t have access to a fax machine and I wanted to unload it quick because I was afraid it was going to drop - it was the highest it had been in a long time and seemed to be ready to drop.
After the weekend I found out she hadn’t got around to faxing in the forms for me. I was upset, and the stock was going down - but then it sprung up before it got sold and I ended up making almost twice what I would have had she sent in the forms when I asked her to.
Hey fellows, I sympathize with everybody who trade stocks, win or lose. The pits today may be the mountain top tomorrow.
However, I also reserve the right to whine too. I am very conservative, very retired, and very disturbed by the odor of my nest eggs spoiling before they hatch. Leery of the new dottycoms and didn’t buy. Whew! Thought WorldCom had the moxie needed for the wireless age and bought at 42; Good to hold I guess if I live this century through.
My good old solid consumer products and telephone stuff is not exactly thrilling me either.
So come along laddies and mewl with me,
the worst or the best is yet to be.
If it helps, I was in a broker’s cube the day that my employer’s stock was trading at its all-time low, and I was holding 100 shares of another stock in my hands (entering it into margin.) I didn’t trade, my company’s stock is down to twenty times what it was worth that day, and the other company is bankrupt.
On the other hand, I’m glad that I made a few smart buys on tech stocks last year, just in time to see them double and then tank…
Don’t feel too bad. My drivers ed. instructor missed out on Blockbuster video store stock before it exploded. Yup he ignored the advice of his financial advice person and didn’t buy. Although I wouldn’t kick him in the groin, I needed him so I could get my license.
My drink of choice is tequila, but I’ll be taking your advice as well.
By the time my options vested the company was below the strike price. ( Although as of this Friday they were worth $520 if execised 
) All in all though the fact that I still have a job puts me better than a lot of people I know.