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Author: insidecenter Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 35392  
Subject: "safe" place to stash some cash? Date: 1/7/2007 5:45 PM
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Looking for help... I'm a dedicated stock index investor (thank you fools!) but currently have a situation I'm not sure how to handle. I work for a large tech company (lots of stock options) and our stock has had a very nice run-up in the last year, so I'm looking at quite a bit of potential gains from that.

I'm also recently married and we're thinking about buying a new house within a 9-18 month window. So, I'm considering selling some of the stock options now as part of an overall diversification strategy and to pre-fund some of the down payment for the house. I have a few questions, and I'm hoping that folks here might be able to help.

-- guidelines: 9-18mo window, need to be able to get to it at any point (if/when we pull the trigger on the house)

-- primary question: if I sell the stock, where do I put the money in the interim? I need something that's fairly low-risk, but 5% on a money-market account doesn't seem like the right idea. I have a good understanding of bonds and credit markets, but I know very little about how they are bought/sold/traded (meaning I can explain how a municipal bond differs from a corporate bond, but I don't know how to buy either)... leading to:

-- what little I've read seems to imply that if I find a decent bond fund, I may be able to significantly beat the fixed-income alternatives with only slightly more risk. This is where I most need the help... if YOU had $200k or so and a 9-18mo horizon to invest it (again, risk tolerance is "low" but not "zero") where would you put it? I can't do straight bonds as I need more flexibility, right? Stocks (even ETFs) seem too high-risk.

-- if the answer is indeed a bond fund, how do I find one that won't get me rooked with loads and fees and all these other things that I don't understand?

-- tax implications of selling stock options? When I sell the stock I take a tax hit, but I'm thinking that the risk reduction is worth that. Opinions?
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