Investing in your company’s shares
Don’t put all your eggs in your employer’s basket, said Jason Zweig at The Wall Street Journal. Before you buy stock in your own company, “set your emotions aside” and carefully assess the risks. While you’re at it, look at the “tragic tales” of ex-employees of failed firms like Enron, Bear Stearns, and Lehman Brothers, “who had nearly all their retirement assets riding on those firms’ own shares.” While subsequent laws have made linking retirement plans to your employer’s stock harder, the problem “hasn’t disappeared” completely. A smart investor should remember to diversify away from company stock. Yes, you might miss out on a spectacular gain, but you also “limit the risk of being wiped out” if the company goes belly up.