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Corporate Executives

Navigating The Risks Of Stock Over-Concentration: A Guide For Corporate Executives

Let's talk about the elephant in the room that a lot of executives like you face: the risks of having too many eggs in one basket, particularly when it comes to your company stock.


Consider this scenario: you've been with the company since its early days, and your stock options have ballooned into a significant portion of your portfolio. It's a common tale—one of loyalty, hard work, and perhaps a dash of optimism.


But what happens if that once-promising stock takes a hit? I know it’s hard to imagine the worst about your company, but it could be from external factors out of your control like a market downturn, a recession, or a pandemic. When you fail to diversify and things are good, they’re good, but if they ever go bad, they can get really bad.

So what are the next steps?

Let’s imagine your company stock price is currently at 130, but you are ‘anchored’ at a specific stock price of it reaching 150 before you would consider selling. It may never reach that number and could end up dropping much lower than its current price.


The rational investor compares the value of a stock based on the day they bought it versus any other day, to weigh whether it’s a good investment. You shouldn’t let emotional value take a seat at that table.


Now, I know solving this issue may seem tricky. You may worry about the perception of selling shares or may even be locked out from selling shares at certain times. But there are plenty of workarounds. We can look at your specific situation and see which ones might work - strategic selling programs, hedging strategies, exchange funds, giving stock to charity, or setting up charitable remainder or lead trusts.

Navigating Corporate Executives

We’ve been helping corporate executives navigate this and other issues for years. At the end of the day, the long-term well-being of your family is what’s most important.

Let’s start the conversation to see how we can help you compose and conduct the symphony of your life.

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