Stock Loans: Bridging Liquidity, Diversification, and Risk Management
Importance of Liquidity
A securities-based loan, or commonly referred to as a stock loan, is one the least expensive financing options available. The low rate loan is obtained through the pledging of stock, bond, or investment portfolio as collateral. A line of credit can also be established using these securities. The loan is non-recourse so the lender can only recover the collateral or the pledged securities. Clients retain ownership of the securities and benefit of the investment portfolio such as capital appreciation,
dividends, and interest income.
Diversification
A securities-based loan, or commonly referred to as a stock loan, is one the least expensive financing options available. The low rate loan is obtained through the pledging of stock, bond, or investment portfolio as collateral. A line of credit can also be established using these securities. The loan is non-recourse so the lender can only recover the collateral or the pledged securities. Clients retain ownership of the securities and benefit of the investment portfolio such as capital appreciation,
dividends, and interest income.
Portfolio Risk Management
A securities-based loan, or commonly referred to as a stock loan, is one the least expensive financing options available. The low rate loan is obtained through the pledging of stock, bond, or investment portfolio as collateral. A line of credit can also be established using these securities. The loan is non-recourse so the lender can only recover the collateral or the pledged securities. Clients retain ownership of the securities and benefit of the investment portfolio such as capital appreciation,
dividends, and interest income.
Did You Know?
Stock Loan Solutions Case Studies:
- Bridge Financing for Real Estate & Tuition Payment
- Business Expansion and Line of Credit
- Concentrated Stock Post IPO
To learn more about portfolio risk management strategies, clients can contact Blue Diamond Capital Advisors.
Blue Diamond CapitalA security-based loan and other financial vehicles that can be employed to manage concentrated stock positions. Optimizing a various equity risk management strategies can 1)provide immediate liquidity 2) provide additional income and 3) provide stock protection.
- Protect against stock declines
- Diversify concentrated position
- Increase borrowing power
- Generate additional return and income
- Defer capital gains
- Current or retired employees with considerable holding of company stock
- Excutive or founder who receved stock in a merger
- Investor who hold restricted or low cost basis stock from a initial public offering
- Individuals with margin positions tied to unprotected concentrated stock
- Inherited stock from previous generations