Reuven Geltkup is an experienced investment advisor and a licensed broker at Kessef Securities. Among his clients, is his friend Shimon Reichman, who maintains a large account with him.
One morning, Shimon called Reuven, and asked him to please buy $1,000,000 of XYZ stock. True to form, Reuven’s instincts kicked in, and he immediately began analyzing the advisability of purchasing XYZ stock at this time. He pored over XYZ Company’s SEC filings, and other financial data which he was able to legally access. His findings were quite disturbing to him, as he discovered that XYZ was having serious financial problems, and he therefore predicted that XYZ’s stock was highly overvalued, and it was unadvisable to invest in their stock at this time.
Reuven, who had recently spent much time researching ABC Company, was of the opinion that ABC was highly undervalued in the marketplace. His research had discovered that they were on the verge of signing a huge deal, and they were poised for a dramatic breakout in price in the near future.
Unasked, Reuven decided to help his friend Shimon, and instead of investing the $1M from Shimon’s account in XYZ stock, he instead bought up $1M of ABC stock.
Sure enough, in a short time, Reuven’s analysis proved true. Unfortunately, XYZ Company saw a 20% decline in its value, while ABC stock shot up in value by 30%.
Reuven called his friend Shimon, and notified him of the initiative he had taken regarding his trading account, and how wildly successful he had been. Instead of a potential $200,000 loss which Shimon would have been looking at, his account showed a profit of $300,000!
After hearing Shimon’s repeated thanks to Hashem for this windfall, Reuven modestly reminded him that while Hashem may have blessed him with a windfall, it was through His humble messenger, yours truly, that this windfall transpired. Reuven expressed to Shimon that it would appropriate if Shimon shared some of Hashem’s largesse with him, the messenger. He humbly requested a 5% share of the profits which he had generated.
Shimon politely demurred, saying that he didn’t think that he had any legal obligation to give Reuven any bonus.
Is Reuven’s claim legitimate?
Kollel Toras Zeraim HALACHA
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