Executive Services - Concentrated Equity Strategies


Concentrated Equity Strategies

Baird can help individuals who hold large concentrated equity positions better manage their risk and tax consequences by implementing a combination of different potential strategies: 

Hedging Strategies
Hedging techniques help executives protect concentrated positions of stock over specified periods of time in a tax-efficient manner where appropriate. Baird takes a consultative approach to determine which strategy is most suitable for you, then solicits bids to identify the most competitive providers. Some hedging strategies Baird offers are:
  • Costless collars
  • Variable pre-paid forward sales
  • Put spread collars
  • Private sales (discounted)
Exchange Funds
An exchange fund is a tax-advantaged diversification tool for highly accredited individuals with large concentrated positions of typically low-cost basis stock. Under current Internal Revenue Service guidelines, both contributions and receipts of securities are considered nontaxable if appropriate guidelines are met. The exchange fund is a Regulation D Private Placement and available only for qualified purchasers ($5 million or more of investable assets).

As a full-service firm, Baird has the capability and flexibility to assess the market and negotiate with a variety of top providers on your behalf, then customize a combination of strategies designed to help you reach the best outcome while managing your tax liability and liquidity requirements. Baird can also advise executives about exercising stock options and complying with relevant government regulations concerning restricted and control stock transactions. 

Contact a Baird Financial Advisor for more information.
Contact a Baird Financial Advisor