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If the share price & market cap were to drop by 40%, would that have index funds selling the stock right away or do they take a while to rebalance?
Most people in their shoes would probably be selling too.
The stock price will be very volatile (even without any major news)at least over the next year as it settles in.
You will see stock players that are shorting the stock yelling "fire" trying to influence the stock price down and then after they profit at that end the next you here they'll being pushing the hype and working the long position.
If you are not daytrading but purely long then simply figure out what you feel is the best PE that google should be trading at and dont buy until then .
Insider selling at this point is ONLY a signal of them finally taking the big payday and rarely signals anything important at a company.
I dont; think they know or think that the system is broken? One man's broken system is another man's $40 billion company. Insider trading is very different and they'll probably soon announce the exact date of sale (let's say June 14th, 2005) to sell the stock no matter what price. This way there's no insider trading questions.
For those cases, trust me, it's a bad bad sign. I always had a lot of respect for the guys at top, but this really dissapointed me.
Yes, it is normal course for *employees* to sell their stock options, and for VC to sell their shares, but for founders?
Absolutely not! Not unless they had already quit the company.
And if they have no confidence in the company, then they should say so loudly and clearly before they sell their shares, otherwise YES, it is insider trading.
I wouldn't read anything at all into this sale.
From CBS Marketwatch:
In a separate filing, John Doerr, a board member of Google and a partner at venture capital firm Kleiner Perkins, filed with the Securities and Exchange Commission Friday, to report the sale of 5.78 million class A common shares at $172.54. Doerr filed on behalf of Kleiner Perkins. The shares are worth $997 million.
Kleiner Perkins bought in at $.49 per share. I guess that will cover a few losers :)