Protect...Grow...Repeat

Market & Economic Brief

Summer 2010

GLOBAL STOCKS
Stocks generally ended the first half of 2010 under pressure. The S&P 500 was down -7.5% and the MSCI Developed Country index declined -15.8%. Q2 earnings reports are expected to be strong but forward guidance is less certain. Leading companies held up surprisingly well as markets sold off.

WORLD ECONOMY
Leading economic leading indicators produced by ECRI continue to signal a slowdown in the U.S. economy but will need to deteriorate further before signaling another recession.

INFLATION DATA
Broad inflation pressure appears to be contained and interest rates remain very low.

U.S. RESIDENTIAL HOUSING
After a pick-up earlier in the year, home sales appear to have slowed after the expiration of the home buyer credit at the end of April in most U.S. markets.

PLANNING
New conversion rules for ROTH IRA's in 2010 may present a unique planning opportunity.

Potential tax changes in 2011 are reason to review tax strategy in 2010.

Concentrated Stock Strategies

You have worked hard to build your wealth and find yourself with the benefits of stock ownership as an executive or director in a publicly traded company but there are challenges to diversifing your position. Aside from the unintended emotional characteristics tied directly to the company and the volatile nature of stocks, company and regulatory rules may restrict your ability to transact in public markets. Possible liquidity restrictions include: Lock-out Period, Black-out Dates, Rule 144, and other considerations.

Depending on your circumstances, the SEC has adopted a rule that provides limited safe harbor to individuals that closely follow it. Even better, the rule is relatively easy to understand, establish, and administer offering a new tool for insiders to create liquidity from stock and option holdings.

For those individuals interested in exploring the benefits of diversifying their personal wealth tied to concentrated stock or option holdings, Dightman Capital can help you explore possible solutions. The principal Investment Officer at Dightman Capital has advised and implemented diversification strategies for Section 16 Officers, S-3 Registrations, Initial Public Offerings, and other concentrated stock and option holders. Potentially even more important, Dightman Capital avoids direct association with capital market underwriters or research analyst often found with Wall Street firms and banks.