Concentrated Stock Comprehensive Guide eBook PDF version - Page 5

Strive to Reduce Volatility Inherent with a Single-Stock Concentration.

Maximize the divestment value using in-depth fundamental and technical analysis.

Work towards generating cash-flow income with the sale of stock or index options.

Example: Phases of Diversification

5

PHASE II

PHASE III

LONG TERM

Current or Phase I:

Start by implementing an income strategy, for example...

Begin implementation

of diversified portfolio

of equities and bonds

to generate tax-free

income.

Continue to execute

income strategies to

enhance cash flow

and reduce margin.

Evaluate active tax-loss harvesting strategy to reduce taxes.

Continue building a portfolio with added diversification and income streams, and execute income strategies to enhance cash flow and reduce margin.

The portfolio will be more diversified, grow, and generate a steady of flow of income.

Maintain active tax-loss harvesting strategy.