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Reduce Taxes Through Tax-Loss Swapping

David Stone joined the CR Wealth Management Group of Stifel as Director/Investments in 2016. At Stifel, David Stone and his team serve the interests of their clients by utilizing strategies such as tax swappin g. A strategic form of tax planning, tax-loss swapping involves the sale of investments that have experienced losses. In their place, investors purchase stocks from firms in sectors with equivalent foundations. When completing these transactions, investors must keep the IRS’s wash-sale rule in mind. This rule prohibits an investor from recognizing a loss on the sale of a security if he or she purchases a “substantially identical” security within 30 days before or after the sale. Since the IRS’ definition of what constitutes a “substantially identical” security is somewhat vague, you should consult your tax advisor before making a purchase. When employed effectively, the tax-swap strategy may allow investors to bolster the diversity of their portfolio. Moreover, it serves as
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Risk Tolerance is Key When Looking to Invest

As Director/Investments with the CR Wealth Management Group of Stifel, David Stone works alongside 11 financial advisors who serve high net worth clients. Working closely with a diverse client base, David Stone and his team utilize factors such as risk tolerance to develop balanced investment strategies.  Risk tolerance is one of the most important considerations when investing. Using this tool, you can better determine how much variability you should allow regarding the financial worth of your investments. As such, risk tolerance will provide a framework for all of your future investment activities. The most aggressive investors have a high risk tolerance, which means that they are willing to take on risky investments in return for the promise of higher financial compensation. Long-term investments are best suited for those with higher risk tolerance.  If you find that you have a low risk tolerance, you should ask your financial advisor to find investment opportunities that have a
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The Basics of Initial Public Offerings

As Director/Investments of The CR Wealth Management Group of Stifel, David Stone provides clients with a coordinated approach to asset allocation. David Stone and the Stifel team offer a range of fee-based strategies, as well as initial public offerings (IPOs). IPOs are traditionally arranged via a broker-dealer, broker-dealer group, or investment bank. They involve the purchase of shares from the company going public, with the shares distributed to investors. When interest in an IPO is high, the shares often find their way to institutional investors that are willing to take major shareholder stakes. Because the shares associated with IPOs are often quite limited, one investor or investment group obtaining more than 10 percent of the allocation is extremely rare.  Individual investors typically access sought-after IPO holdings through large asset managers. Unfortunately, in some cases, not all investors interested in high-profile IPOs are able to participate, as many are seeking to
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Hedge Funds - Leveraged Investment Strategies

As Director/Investments with The CR Wealth Management Group, David Stone oversees a wide range of financial management activities, with an emphasis on providing clients a secure income in their retirement years. David Stone and the advisors at Stifel provide a full host of third-party independent money management strategies, including private equity, exchange-traded funds (ETFs), and hedge funds.  While hedge funds lack the liquidity of mutual funds, they offer Stifel clients a broader range of securities in which to invest. In addition to stocks, bonds, real estate, and other traditional investments, hedge funds enable the holding of futures, options, and other types of derivatives. Article provided by David Stone, Director/Investments with Stifel, Nicolaus & Company, Incorporated, member SIPC and New York Stock Exchange, who can be contacted in the New York, New York office at (212) 328-1000. Investors should be aware that hedge funds often engage in leverage, short-selling, a
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Details of Tax-Loss Swaps

As Director/Investments of The CR Wealth Management Group of Stifel, David Stone works closely with ultra-high net worth and high net worth clients. David and his colleagues collaborate with an experienced tax and estate attorney, as many of the group’s clients have complex tax needs. To serve the needs of clients with complex tax situations, David draws on his knowledge of tax-loss swapping . This technique can serve as an option when rates have increased and caused the value of a bond to drop below its base cost. By selling the bond at a loss, the investor can fund the capital gains tax due upon the sale of an asset. David understands the many intricacies involved in a tax-loss swap, including the wash sale rule, which forbids the recognition of a loss if the investor purchases a substantially identical product within a 30-day period prior to or after the sale. He must also determine whether the relevant gains and losses will occur within or after 12 months. Gains or losses experi
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Simple versus Complex Trusts

David Stone serves as Director/Investments for the CR Wealth Management Group of Stifel and provides advice to a number of ultra-high net worth families whose wealth management plans include complex trusts. A complex trust is, by definition, any trust that cannot be classified as simple. A simple trust must distribute its income in the year that the trust receives it; however, it may not distribute any funds that are not classifiable as income. These disallowed funds include any and all corpus, defined as the money that originally established the trust. A complex trust may retain a percentage of its income per year and can distribute to beneficiaries some amount of the corpus. In addition, the complex trust may specify separate amounts that the trust can then pay out to a particular charitable recipient. David must understand the distribution requirements for both simple and complex trusts, as the manner of income handling can cause a trust to change classifications within a tax ye
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Offering Hedge Funds

As Director/Investments with The CR Wealth Management Group of Stifel, David Stone helps corporate and individual clients pursue their financial goals. Based in Stifel’s offices in New York, David offers wealth management strategies that incorporate various products, such as hedge funds . A form of alternative investment, hedge funds pool funds from several investors in an effort to generate positive active returns for all investors in the pool. Hedge funds often make use of derivatives (which are securities that have a price dependent on at least one underlying asset) that may be aggressively managed with the aim of creating high returns, usually above those specified in a market benchmark. Hedge funds take numerous forms, but most strive to identify opportunities within a certain market. Typically, investments in a hedge fund are considered illiquid, which means investors may not withdraw their money from the fund for a certain time period (often referred to as a lock-up period).
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