Happy holidays to all,
So a little about my issue. My portfolio is highly concentrated and highly margined which needs to be corrected. I have been contacted by a firm which suggested that I give up my 2 largest positions (representing 120% of my portfolio) to an exchange fund. The fund will take my shares and give me shares in the fund that I will need to stay in for seven years (150bp in fees a year). The advantage will be immediate diversification but no taxable event will occur according to the firm as long as the shares are held for several years. I will of course be taxed when the shares are sold.
So my options are,
1. Go into the exchange fund to avoid the taxes for several years
2. Sell the positions and take the tax hit
3. Whittle down the positions and exposure with options.
Any advice would be greatly appreciated.
So a little about my issue. My portfolio is highly concentrated and highly margined which needs to be corrected. I have been contacted by a firm which suggested that I give up my 2 largest positions (representing 120% of my portfolio) to an exchange fund. The fund will take my shares and give me shares in the fund that I will need to stay in for seven years (150bp in fees a year). The advantage will be immediate diversification but no taxable event will occur according to the firm as long as the shares are held for several years. I will of course be taxed when the shares are sold.
So my options are,
1. Go into the exchange fund to avoid the taxes for several years
2. Sell the positions and take the tax hit
3. Whittle down the positions and exposure with options.
Any advice would be greatly appreciated.
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