Diversifying a large stock position without triggering a massive tax bill can feel impossible, but there are advanced strategies designed specifically for this challenge. In this episode, Matt breaks down two powerful but often misunderstood tools: the 351 Exchange and the Exchange Fund. While they sound similar, they serve completely different types of investors and portfolio problems.

You’ll learn how a 351 Exchange can help reorganize an already diversified portfolio into a custom ETF without realizing capital gains. Then, Matt explains how an Exchange Fund can provide much-needed diversification for someone with a highly concentrated stock position, along with the trade-offs, lock-up periods, and accredited investor requirements that come with it.

Here’s some of what we discuss in this episode:

Why selling concentrated positions can trigger massive tax bills

What a 351 Exchange actually is- and who it helps

How Exchange Funds work and why they require a 7-year lock-up

How to decide which strategy fits your situation

0:00 – Intro

1:16 – Overview of 351 Exchange

3:13 – Overview of Exchange Funds

4:12 – Comparing 351 and Exchange

4:52 – How to choose the right strategy

Resources

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