Investment Advisory Services

Design, develop and implement an investment strategy as precious fuel for achieving each client’s particular goals and life mission.

Situation Overview

As result of having built a successful national business over multiple generations, a family still holds large, concentrated blocks of company stock. The stock has performed at or above market rates, and the company is still prized by the family. Members of the family are reluctant to sell shares, despite the risk of the concentrated holdings.

Solution

Threshold’s investment team analyzes the company stock against relevant risk/return characteristics of a diversified portfolio and other similar stocks.  Advisors work with family members to present the risks and short-term volatility being assumed  as a result of their allegiance to the legacy stock holding. An educational presentation is created to allow the family to focus first on preferred characteristics of a portfolio, and then on how to build out the investments with a concentration of company stock included. This allows the family to think about how to build a portfolio that will accommodate their loyalty to the legacy stock.

Outcome

Family members participate in a fundamental analysis of how their company stock fits into an overall portfolio, and how it may serve (or fails to serve) their goals. They start to talk about overall asset allocation and family goals rather than a single buy/sell choice. They agree to gradually reduce the concentrated exposure and increase overall diversification around the stock, recognizing and accepting the risks in the total portfolio.