No. of Recommendations: 0
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?
Print the post  


What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.