Managing Concentrated Stock Wealth : An Adviser's Guide to Building Customized Solutions

by Kochis, Tim

• ISBN13: 9781576601778
• ISBN10: 1576601773
• Format: Hardcover
• Copyright: 2005-06-01
• Publisher: Bloomberg Pr

Summary

An old adage cautions against putting all of your eggs in a single basket. Yet many investors maintain a significant portion of their wealth in one stock, as a result of executive compensation packages, stock inheritances, IPOs, or corporate buyouts, leaving their portfolio in a dangerous position. Tim Kochis, a recognized leader in financial planning, has compiled more than fifteen strategies for managing concentrated stock wealth. The book explores the key barriers to addressing concentration risk-securities law, taxes, psychological resistance-that clients and their advisers must overcome to successfully manage concentrated stock wealth. This book fills a void in the adviser's arsenal and lays out the options available to clients. Using examples drawn from decades of work, Tim Kochis shows not only what can be done, but also what actually works-and even how concentration can present unique opportunities for preserving and growing wealth.

Author Biography

Tim Kochis, JD, MBA, CFP, is CEO of Kochis Fitz Wealth Management in San Francisco. Before forming Kochis Fitz in 1991, he was national director of personal financial planning for Deloitte & Touche and, before that, for Bank of America. Kochis serves on the boards of several industry organizations and has chaired the CFP Board of Standards, the Foundation for Financial Planning, and the international Financial Planning Standards Board.

Table of Contents

FOREWORD	ix
ACKNOWLEDGMENTS	xi
INTRODUCTION	xiii
PART I SALES
1 Constraints on Managing Concentration Risk	3	(16)
2 Sale and Diversification	19	(10)
3 Coordinating Long Shares With Stock Options	29	(18)
4 Diversification Sales and Deferred-Compensation Plans	47	(12)
5 An Out for Insiders	59	(14)
6 Restricted Stock: Tackling Temptation	73	(20)
PART II GIFTS
7 Gifts to Family	93	(14)
8 Nonqualified Stock Options: Gifts to Family	107	(10)
9 Gifts to Charity	117	(16)
10 Charitable Trusts	133	(12)
11 Nonqualified Stock Options: Gifts to Charity	145	(10)
PART III RETENTION
12 Margin: An Acquired Taste	155	(14)
13 Managing Concentration Through an Index Proxy	169	(10)
14 Exchange Funds	179	(6)
15 Derivatives and Hedges: Buying Time	185	(14)
16 Powers of Concentration	199	(16)
AFTERWORD	215	(4)
CONTINUING-EDUCATION EXAM
for CFP Continuing-Education Credit and PACE Recertification Credit	219	(12)
INDEX	231