There is no right or wrong, it also comes down to personal preferences. Many seriously rich people probably havent been diversifying that much.
Also, a middle ground is possible. Sell some of the stock for safety, and take risk with the rest.
Also, a middle ground is possible. Sell some of the stock for safety, and take risk with the rest.
You shouldn't bet on getting lucky.
Even to keep among the 'rich' list assuming you inherited it all takes enormous talent because money inflates away.
There may be a bigger incidence of luck (I am not sure of this either btw - almost all the contacts you get as a rich person are very much the effect of you being rich) but unless you're well prepared to take full advantage of it, there will be no returns.
What I will concede though: Luck when you're poor might mean securing a week of food. Luck when you're a billionaire probably means the stock market goes on a 15 year bull run.
There is nothing luckier than being born rich. Treating it as some sort of skill to remain rich is part of the dysfunction in US society where wealth is equated with virtue & character.
If you are rich, but not smart -- it is hard to avoid temptation to invest into risky projects. It is hard to identify people who just want to drain away your money.
I did acknowledge the luck part in being rich. I do acknowledge it is far better than being poor. But if you want to remain rich and ensure your generations remain rich, that's a ton of work.
PS - seriously rich might mean different things for us though :)
Did a lot of drugs, didn't pay attention in uni, didn't work, didn't build the habits of a successful person. Still, he got one chance after another, and in his late 20s he actually did. From what he told me, realizing how insanely privileged he is was one of the major influences for him to change.
But still, a normal person would have been long out of chances at that point, and would fight serious debt and worklessness without any support.
You maybe cannot afford to be a total wanker forever as a rich person, but you certainly have a lot more leeway in your wankiness.
Meanwhile, trading stocks on margin...
I think the FAANG people I know who supposedly make 500k/yr only got to those numbers by never selling a single share and then reporting total net worth including appreciation divided by time worked. Their base salary isn't actually that crazy. People who sell all their shares for index funds didn't do as well.
It is usually the salary + stock award that will vest over 4 years. For most companies with a flat vest, the total will come to 500k/yr for certain levels.
The appreciation is all yours. Future perf bonuses which will be each 6 months or a year are on top of this. Some companies do adjust for what you're making in that year and cut down the perf bonus (In a previous company I once got a promotion without any stock because our stock had tripled in the time...) - but these companies have a serious growth outlook. Once the stock flattens, there will be a major drain and they know this.
On average over a long period, but in this case you are invested in one company over a very specific entry date and period of time, with some critical periods blocked from selling.
Facebook peeked around the end of July 2018 at 209$, if you got stocks then you might be in trouble, or already sold out after seeing 124$ during December 2018.
But comfortably rich? You’re more likely to get there with diversification than concentration.
Whether you want to take bigger or smaller risks is up to the person in question.