Do you know what is Employee Share Option Scheme or so called ESOS? My good friend Calvyn Lee who is working in Motorola company told me about this scheme few months ago. Based on his information, i know that ESOS is a scheme where the company offer their employee to purchase their stock at a discounted rate compared to the market price.
It requires the employee to hold on to the stock for certain time period. If not mistaken, there’s a minimum holding time up to 2 months – 3 months. However, you can see your Return On Investment on the first day you buy as normally you will buy it at 10-15% discounted rate.
Although high possibility you can make profit from it, but it is no guarantee as there’s some risk involved especially current market is extremely volatile.
So, for those who are considering to take up to personal loan from to invest in ESOS scheme, please think twice before leveraging banks money to get higher returns. You need to take some calculated risk on it as interest from the bank is around 6% to 8% which may bring big burden for you and taken away a part of your potential profit which is not guaranteed yet.
Besides that, you must know that the shares benefit or profit is taxable as well.