Stock Protection Fund
Date: Thursday, September 15, 2016
Join us for the next program in our virtual series – exclusively for GIC members
Stock Protection Fund
Tom Boczar, Chief Executive Officer of Intelligent Edge Advisors, a New York City-based investment banking and capital markets boutique, will discuss the “Stock Protection Fund – what it is and how it works” at the next event in GIC’s virtual series. He will be introduced by GIC board member Domenic D’Ginto.
This virtual event, exclusively for GIC members, will be conducted via the web and telephone dial-in from noon to 1 p.m. Eastern. Participants will view a PowerPoint presentation online while listening to the speaker from a phone line. Attendees will participate from their offices or homes.
Please note that space is limited for this virtual program. Don’t wait: Register today!
Many executives and investors have much of their wealth concentrated in highly appreciated positions of publicly-traded stock that they don’t wish to or can’t sell because of tax and other considerations. The foremost peril to the creation and preservation of single stock-based wealth is the destructive power of rare, left tail-risk events, and over time, effective and consistent risk mitigation can be the most important source of investment outperformance or alpha. Unfortunately, the traditional tools investors have come to rely upon to protect their stock investments — equity derivatives such as puts, calls, collars and prepaid variable forwards — have become much more expensive in recent years due to the convergence of several factors and are largely used in a short-term, tactical manner. The discussion will introduce a newly invented and patented risk mitigation technology — The Stock Protection Fund — that can be helpful in managing company-specific risk.
Investors who own stock positions that have already appreciated significantly in value, as well as those who make new concentrated investments in single stocks, can employ The Stock Protection Fund to substantially reduce or even eliminate downside risk attributable to the idiosyncratic factors associated with that particular stock, without incurring excessive expenses or taxes, and while retaining all future upside potential.
ESOP companies can use the same risk mitigation methodology – embodied in The ESOP Protection Fund — to reduce the risk of large stock losses and help protect the value of ESOP assets for the benefit of ESOP Participants and their Beneficiaries, while reducing the risk of “stock drop litigation” (by demonstrating a commitment to protect the ESOP against large losses), and lowering the regulatory (DOL) risk.
ESOP participants have the right to receive their vested account balances after they depart the company and the sponsoring company is obligated to repurchase their stock. ESOP companies can use the same methodology – embodied in The ESOP Repurchase Obligation Protection Fund – to substantially reduce the potentially catastrophic risk caused by a large increase in repurchase liability due to a significant appreciation in stock price.
Thomas J. Boczar, Esq., LL.M., CFA, CPWAChief Executive Officer, Intelligent Edge Advisors
Tom Boczar is Chief Executive Officer of Intelligent Edge Advisors, a New York City-based investment banking and capital markets boutique. The firm focuses on M&A advisory and execution, real estate capital markets and hedging & structured solutions. Tom is a pioneer in the delivery of concentrated wealth advisory services to UHNW private clients through their wealth and tax advisors, and is recognized as one of the nation’s foremost experts with respect to the tax-efficient monetization of closely-held businesses, real estate, concentrated stock positions and deferred tax assets.