How to Diversify Concentrated Stock Without a Big Tax Bill

A strong market can create a new problem. A single stock or ETF grows to represent a large portion of your net worth. Now you face a difficult tradeoff: diversify and trigger a large tax bill, or hold the position and accept concentrated risk.

In this episode, Tyler Emrick, CFP®, CFA®, walks through practical strategies for managing concentrated stock positions in a tax-efficient way.

You will learn:

• How a Section 351 exchange into an ETF can provide diversification while deferring capital gains
• How tax-aware long-short strategies can help create ongoing tax offsets while gradually reducing a concentrated position
• When Net Unrealized Appreciation may apply to company stock inside a 401k
• How donor-advised funds and charitable planning can reduce capital gains on appreciated shares

Have questions?

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