In this episode sponsored by Obsidian CIO, hosts Bob Huebscher (Founder of Advisor Perspectives) and Joe Halpern (Managing Partner and CIO of Obsidian CIO) continue their series on tax-aware investing by exploring one of the industry’s most discussed—but least understood—strategies: Section 351 ETF exchanges.
Joined by Meb Faber, Co-Founder and Chief Investment Officer of Cambria Investment Management, the conversation explains how Section 351 ETFs can help investors diversify concentrated stock positions while deferring capital gains taxes, and why advisors should understand this emerging planning opportunity.
- Understand How Section 351 ETFs Work — Learn how investors can contribute appreciated securities into a newly launched ETF and receive a diversified portfolio while deferring capital gains taxes.
- Explore the Tax Advantages of the ETF Structure — Discover why ETFs have become one of the most tax-efficient investment vehicles through their unique creation and redemption process.
- Know the Key Eligibility Rules — Understand the important contribution requirements, including the 25% and 50% concentration limits, and which assets qualify for a Section 351 exchange.
- Compare Section 351 ETFs with Traditional Exchange Funds — Learn how these structures differ in terms of fees, liquidity, holding periods, and accessibility for investors.
- Evaluate Tax-Efficient Diversification Strategies — Explore how advisors can help clients reduce concentration risk without immediately triggering significant tax liabilities.
- Stay Ahead of an Emerging Opportunity — Hear why Section 351 ETF exchanges are gaining traction among family offices, independent advisors, and tax-conscious investors as adoption continues to grow.
Listen to the full Advisor Wars podcast on Spotify.
IMPORTANT DISCLOSURE: Obsidian CIO LLC sponsors the podcast to further education and critical thinking about the factors that affect markets and investing. The podcast does not provide investment advice. Investment advice is offered only to clients of Obsidian CIO who have entered into an advisory agreement and with whom Obsidian CIO has identified individual objectives, risk tolerance, and other investment needs.
