The wealth that can be gained by helping to develop a successful company is vividly illustrated by the example of NVIDIA employees. One of them, an employee «middle management» has accumulated a fortune of $62 million by receiving shares in the company. This option can be a great incentive for employees. However, another NVIDIA employee made a mistake of almost a billion at the current value of the shares and lost money.
The first employee had been using the Employee Stock Purchase Plan (ESPP) for 18 years and held onto his shares against all odds. He was not a high-ranking engineer, but simply took full advantage of the ESPP, which allows employees to use 10-15% of their salary to buy company stock at a 15% discount to the market price.
As a result, the employee left the company with a stake worth $62 million. It must have been difficult to hold on to those shares without selling them occasionally to get some cash, but he never sold the shares during his tenure with the company and ended up with a more than solid «pension».
Another former NVIDIA employee once owned a million shares in the company (one share is now valued at $882). Unfortunately, he had to sell his «green gold» to make up for the losses when his broker bought other shares, which then fell by 90%. A margin account allows you to use the value of one or more holdings to purchase other shares or financial assets. In this case, the forced sale from the margin account resulted in a loss.
Source: Tom`s Hardware