Managing Concentrated Stock Positions
Reduce your tax exposure and increase your long-term financial stability.
Strategies for Tech Professionals Navigating Equity Wealth
For high-net-worth individuals working in the tech industry — especially those at leading firms like Nvidia — equity compensation can lead to significant wealth accumulation. However, it can also create challenges associated with holding a concentrated stock position, exposing one’s portfolio to undue risk.
We help investors with concentrated stock by:
Examining their portfolio, financial situation and goals
Implementing tax-efficient strategies to diversify overly concentrated portfolios
Providing a strategy to preserve wealth and protect against downside risk
Gradual Diversification Through Structured Sales
One common approach to reducing concentration risk is a structured diversification strategy. This strategy can include setting up a 10b5-1 trading plan that enables systematic stock sales over time. Such plans help mitigate market timing risks while providing liquidity and reducing overexposure to a single asset.
Tax-Efficient Wealth Transfer and Hedging
Advanced strategies like charitable remainder trusts (CRTs), exchange funds, collars and prepaid variable forwards offer additional flexibility. These tools can defer capital gains taxes, provide income streams and hedge downside risk, making them valuable for individuals looking to preserve wealth while gradually diversifying their holdings.
Talk With a Wealth Manager
If you’d like to discuss your concentrated stock position, fill out the form to request a meeting. You’ll first have a brief call so that we can gather some information about your specific needs, then we’ll match you with a wealth manager for your free consultation.
