Many business founders and leaders sold shares this year when the stock price was at a historical high. This is when the company's valuation is soaring, and the United States may be about to amend the law and increase taxes.
According to the filing data submitted to the competent authority, electric vehicle manufacturers Tesla CEO Musk ( Elon Musk held for the fifth consecutive week) Shares, another 934,091 shares were sold, valued at US$963 million, in order to pay taxes on the purchase of 2.17 million shares for the exercise of the stock option. Since conducting a netizen opinion survey on Twitter last month, Musk has sold 11 million shares, close to fulfilling his promise of 10% shareholding.
Wall Street Journal Analyst and research firm InsiderScroe data reported that this year, 48 corporate CEOs have earned more than $200 million each from selling shares, almost the average number between 2016 and 2020 Insiders sell shares 4 times.
In addition to Musk, well-known international cosmetics companies , Estee Lauder founder family member, billionaire Ronald Lauder; Google co-founder Peggy ( Larry Page) ) and Sergey Brin (Sergey Brin); Walton family (Walton family) that controls Wal-Mart supermarket; Dell ( Michael Dell ) that founded Dell Technology ; and,Mark Zuckerberg, CEO of Facebook's parent company Meta platform.
, a constituent stock of the of the S&P 500 Index, has sold a record US$63.5 billion holdings by the end of November, a 50% increase over the full year of 2020.
Daniel Taylor, professor of accounting at the Wharton School of Business at the University of Pennsylvania, said that this is an "unprecedented grand occasion" that has not been seen in recent years. 2021 is the year when insiders sold the most shares in 10 years, much like the early 2000s. , The wave of the late Dakang boom. Taylor pointed out that insiders have been able to sell at the peak and buy at the trough for a long time.
The law does not require high-end executives to explain why they sell stocks, and few people understand. At this moment, members of the Washington House of Representatives are planning to increase taxes. As part of the Democratic Party’s "Build Back Better" bill, they are considering increasing the maximum tax rate for long-term capital gains. Before the new tax rate takes effect, for every 100 million yuan in stocks sold by wealthy taxpayers, it is possible to save up to 8 million U.S. dollars in taxes. In November alone, insiders sold a total of $15.59 billion.
Microsoft CEO Satya Nadella sold half of his holdings last month, which is about $374 million before tax. Analysts said that this move may be related to the 7% tax imposed on long-term capital gains starting next year.
In May of this year, after companies released strong earnings reports, it was another peak period for insiders to sell stocks. Corporate leaders sold $13.12 billion in stocks.
Some insiders continue to sell, but the pace is faster this year. Charles Schwab this year sold the shares of Charles Schwab, which he founded, the most since 2015: 5.3 million shares for a total of $361 million.
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