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Welcome to Twenty-First
Securities’ Interactive Guide to Hedging Low-Basis Stock.
When a stock achieves its
investment expectations, investors sometimes believe that their
only options are to sell it and pay a capital gains tax or
continue to hold it and watch it rise or fall. In fact, there are
other choices available to take a few chips off the table without
triggering tax or giving up ownership. The decision tree
summarizes the various forms of low-basis stock holdings and the hedges
that are appropriate in each situation. The articles discuss these
issues in greater detail.
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Hedging
Basics |
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Swaps
for Pre-1984 Stock |
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One-Instrument
Collars for Post-1983 Stock |
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Protection
for Restricted Holdings |
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FSA Takes Hard Line On
Capitalization |
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Hedging Nonqualified Stock
Options |
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Protecting
“Synthetic” Equity Positions |
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Protecting
Passive Investments in Collective Vehicles |
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Going Forward (Variable Forward
TAM) |
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The Hedging Product of
Choice |
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Considered Responses:
Hedging ISO Stock |
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No-Action Letter Says
Insiders Can Collar Options |
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Strategies
For Hedging Concentrated Stock Positions (Part 1) |
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Strategies
For Hedging Concentrated Stock Positions (Part 2) |
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Strategies
For Hedging Concentrated Stock Positions (Part 3) |
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Hedging Your Employee Stock
Options (Part 1) |
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Hedging Your Employee Stock
Options (Part 2) |
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Hedging Your ISO Stock |
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Articles
are provided for
information purposes only. They are not intended to be
offers to engage in any securities transactions or to
provide specific financial, legal or tax advice. Articles
may have been rendered partly inaccurate by events that have
occurred since publication. Investors should consult
their advisers before acting on any topics discussed herein.
Options involve risk and
are not suitable for all investors. Before
engaging in an options transaction, investors must review
the booklet "Characteristics
and Risks of Standardized Options".
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