GESCO is a security company operating in various fields and basing on the principle of physical protection. Today, James not only discusses all things volatility but also explains different risk-related techniques professionals can use to keep clients comfortable with their portfolios in the market.. With the Super Bowl around the corner, who do you want to win and who do you think will win? Whats the bear case predicated on? Mutual Fund and ETF data provided by Refinitiv Lipper. Covid-19 continues to spread rapidly and the vaccine rollout has been slower-than-expected, which is a worrisome combination for the economy and the stock market., The discussion will be streamed via Zoom at this link: https://us02web.zoom.us/webinar/register/WN_guvDkdmgQcy4-HcSuTnb1Q. Meanwhile, sophisticated investors including institutional firms, insurance companies, and ultra-high net worth individuals have sought higher returns during growth phases and greater protection during recessionary phases by utilizing derivatives, particularly options," said James McDonald, who also serves as the firm's Chief Investment Officer. AssetMark CEO Charles Goldman tells RIA Intel that he is focused on acquisitions, helping advisors, and the long term. On September 21, 2022, the SEC announced charges against James Arthur McDonald, Jr. and his SEC-registered investment adviser firm, Hercules Investments, LLC in connection with two fraudulent securities offerings. Youre describing a giant disconnect between the markets and small businesses that are in a world of hurt. And so, we had that crash and then the desire and the interest in moving back forward. NE Atlanta, GA 30326 *by appointment only. Fox News Flash top headlines are here. The stockbroker and investment fraud lawyers at Sonn Law Group dedicate their entire practice to protecting the interests of investors who have lost money as a result of the negligent or wrongful conduct of those entrusted with protecting and growing our money. Our emphasis is on index options investing around the U.S domestic large indexes, specifically, the S&P 500, the Russell 2000, and Nasdaq 100. *Our firm, in some cases, advance costs and expenses of the case, and in that event, are recovered from the gross recovery of any settlement or verdict. And while recognizing that each investors needs are distinct, on balance what percentage of a portfolio should this comprise? James McDonald, CEO and Chief Investment Officer of Hercules Investments, a Los Angeles-based Registered Investment Advisor, is hosting a virtual event, 'Preparing Investment Portfolios for a . Which was great for McDonald, because he apparently really muffed the market response to a Joe Biden victory over Donald Trump two years ago: He assumed that the ousting of an incompetent demagogue would tank things. I think the phenomena is an anomaly like virtually every pocket of life were in right now. I use this blog to bring attention to regulatory filings involving financial advisors, current events in securities and cases in the financial services industry, and to help investors understand their rights and options for financial recovery. Employment levels have increased slightly, but we are artificially keeping our economy going with stimulus checks and obviously all of the Feds actions. 2023 FOX News Network, LLC. For a free consultation, please call us now at 866-827-3202or complete ourcontact form. McDonald was CEO of Hercules Investments LLC of Los Angeles and Index Strategy Advisors Inc. of Redondo Beach, and frequently appeared as an analyst on the CNBC financial TV news network, authorities said. I played semi-pro football for 12 years. Scott Gamm What should advisors know about your firm and how you can help them? This site contains attorney advertising. Despite the challenges of Covid, equity markets have pushed to all-time highs on most indexes in a fashion that would suggest there is no risk in the market. That would be a doubling from the low. 2023 Informa USA, Inc., All rights reserved, In this episode, David Armstrong, editor-in-chief at. Yeah. The leader of Pershing X explains why her experience, leadership style, and the support of BNY Mellon, have positioned the new venture to disrupt how wealth managers do business. The bear case is that the effects of the shutdowns havent fully been realized yet. WealthManagement.com Staff | Nov 05, 2020. Hercules Investments was founded by James McDonald, who previously was founder and CEO of Index Strategy Advisors. In this virtual event, McDonald shares: - Why the markets are too optimistic about the Covid-19 vaccine McDonald allegedly raised over $5 million and misappropriated funds for personal expenses and Ponzi-like payments. The ideal client would have a portfolio of stocks that have appreciated with the market and while offering great growth potential is susceptible to a market downturn. LOS ANGELES, Oct. 10, 2019 /PRNewswire/ -- Award-winning derivatives investment management executive James A. McDonald, Jr. today announced that he has launched Hercules Investments LLC,. Instead, McDonald allegedly misappropriated more than $1 million of the funds for personal expenses, including luxury vehicles and paying rent on his home, and misappropriated more than $2 million of the funds for Ponzi-like payments, payments to his Hercules investment adviser clients and expenses associated with operating Hercules. And so, the breadth of success is extremely narrow. Get this delivered to your inbox, and more info about our products and services. from 8 AM - 9 PM ET. McDonald was CEO of Index Strategy Advisors from 2010 until 2019, when he founded Hercules, which offers market neutral portfolio management, while specializing in high-growth equity index options for clients. We are partnering with Nasdaq to put Nasdaq 100 Volatility Index (VOLQ) into our portfolio in a way where investors who have realized great gains from tech can rest assured knowing that in the event of a potential market downturn, our fund will be able to sustain the impact of a declining market and should provide upside. https://www.wealthmanagement.com/sites/wealthmanagement.com/files/logos/Wealth-Management-Logo-white.png. Hercules offers qualified clients market neutral portfolio management executed primarily through domestic index options. There are hundreds of companies in the small cap space that dont have the cash to pay their debt. GESCO combines international experience and quality standards with modern technologies and opportunities and local professional service. Your email address will not be published. Greg Bartalos (@gregorianchance) is editor of New York City-based RIA Intel. Our strategies offer downside protection and even potential upside gains with protracted market downturns. The bull case would imply that were 50% stronger in terms of our earnings premium over our equity premium based on what we pay for earnings. First, between May 2019 and October 2021, McDonald, through his control of Index Strategy Advisors, Inc. ("ISA")-an unregistered investment adviser-solicited over $3.6 million from approximately 20 investors for ISA's index hedge fund, the ISA Fund. The Exchange James McDonald's advice to the next generation Hercules Investments CEO and CIO James McDonald offers his advice to the next generation of Black Americans. McDonald also allegedly raised over $3.5 million for securities trades through the Index Strategy Advisors Fund and misappropriated half of the funds for personal expenses. All material subject to strictly enforced copyright laws. Of course, like most of the people brought on by CNBC to explain how the market will react to certain things (like talking heads on any subject on any 24-hour news channel), being generally right about those things was not a booking requirement. So, I think over 75% of the gains in the S&P 500 in 2020 could be attributed to a handful of names. Prior to ISA he was Director of Strategic Initiatives for the $12 billion AUM Compass BBVA Wealth Management Group where he led the design and execution of brokerage, trust, and insurance strategies serving high net worth and ultra-high net worth clients. Hercules Investments won a 2020 Wealthies Award for being the top Alternative Asset Manager. I would be thrilled to buy the Washington football team because I grew up in Chevy Chase, Maryland. This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. - The dangers of too much fiscal and monetary stimulus To what extent do multiples deserve to be elevated given ultralow interest rates? Quant Research-Driven Investment Strategies For Investors Seeking Active Portfolio Management. The SEC appreciates the assistance of the U.S. Attorney's Office, the Federal Bureau of Investigation, and the Internal Revenue Service-Criminal Investigation Division. When facing allegations such as these, its best not to be seen on TV. Please note: We are unable to take cases with losses of less than $50,000. Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox. This inflation will cause interest rates to rise in the medium term or long term and the necessary pullback in the markets will be a result of investors taking risk off the table. To ensure the most secure and best overall experience on our website we recommend the latest versions of, Internet Explorer is no longer supported. Hercules applies quantitative research to design and actively manage portfolios for investors seeking maximum growth during up or down-market cycles. In 2005 he purchased the Houston Wolverines (the Texas Wolverines today), a semi-pro football team, and played for 13 years. Mr. McDonald previously was CEO/CIO of Index Strategy Advisors Inc. (ISA) from 2010-2019. The SEC further alleges that, from February 2021 to October 2021, McDonald raised $1.5 million through the sale of equity investments in Herculess business. Furthermore, index options provide compelling risk/return profiles with substantially less risk and volatility than their stock option counterparts.". Whats your takeaway from GameStop, AMC, Blackberry, etc.? To be clear, you expect a risk event this year will take the Dow down to 15,000 but by year end it will finish higher than today? Our ability to monetize volatility is exceptional as evidenced by our winning WealthManagement.coms 2020 Wealthies Award as top Alternative Asset Manager. In fairness to James McDonald, television is a much more welcoming venue than an SEC hearing room or courthouse. This Book Changed My Life, Fifteen Must-Listen Business Podcasts for Advisors, Celebrity Estates: Jay Leno and Planning for Classic Car Collections. Save my name, email, and website in this browser for the next time I comment. James McDonald from Hercules Investments, and James Camp, Eagle Asset Management director of strategic income and managing director of fixed income, join 'The Exchange' to discuss the impact . McDonald will discuss why investors should be prepared for a looming 2021 stock market crash, after an unprecedented stock market surge since the March 2020 Covid-19-driven stock market lows. To send us an e-mail, simply complete and submit the online form below. Subscribe to RIA Intels thrice-weekly newsletter.]. It wasn't immediately clear whether he had an attorney who could speak on his behalf. This material may not be published, broadcast, rewritten, or redistributed. Powered and implemented by FactSet Digital Solutions. "For nearly 100 years investment firms have sought to address the average investor's goals with simplistic and inefficient mutual funds, or expensive and highly inconsistent stock picking. And we know that this isnt how a strong economy operates. You can reach us by phone at 844-689-5754 or via e-mail. CHICAGO JUDGE DENIES BAIL FOR ILLINOIS WOMAN WHO ALLEGEDLY PUSHED 3-YEAR-OLD NEPHEW INTO LAKE MICHIGAN. Sign up for free newsletters and get more CNBC delivered to your inbox. The Fund seeks to implement very short-term long and short positions in call and put options on the main US stock . A man who ran two California-based investment companies and frequently appeared as a TV financial news analyst was charged Wednesday with securities fraud for allegedly bilking clients out of millions of dollars, federal prosecutors said. In late 2020, McDonald lost between $30 million and $40 million of Hercules client money after adopting "a risky short position" based on his wrong prediction that the stock market would drop. More on that later. The Sonn Law Group is currently investigating allegations surrounding James Arthur McDonald, Jr. or Hercules Investments, LLC. Contact me online or call anytime at 844-689-5754 SEC Charges James Arthur McDonald, Jr. and His SEC-Registered Investment Adviser Firm, Hercules Investments, LLC with Offering Fraudulent Securities Sonn Law Staff Oct 05, 2022 Posted in Investment Loss Investigations # James Arthur McDonald Jr. A Division of NBCUniversal. James Arthur McDonald Jr., 50, was charged with a single fraud count and could face up to 20 years in prison if convicted, the U.S. attorney's office said in a statement. The information provided in this website is offered for general information purposes only; it is not offered as and does not constitute legal advice in any way. Small businesses are suffering tremendously, and theyre always going to be the engine of growth for the economy. No, Brent Kovars mother didnt have an artificial intelligence supercomputer in her basement, the SEC says. His demeanor was professional and pleasant and I would not hesitate to use him in future matters. You've successfully subscribed to this newsletter! Hercules Investments provides a growth option for investors who need gains and growth, but we offer an element of downside risk protection because equity markets are disconnected from what we know is GDP contraction, debt, and all the uncertainty that comes along with a mutating virus. Accounting and Auditing Enforcement Releases. And I think that that is much of whats happened in the macro as well. Its clock-striking-midnight dealmaking time at the Justice Department. The SEC alleges that McDonald commingled the investor funds with Hercules assets and his personal assets, and used $440,000 of those funds for personal expenses, including to pay his personal credit card bills. Describe the ideal client profile. Ainslie Simmonds Vision for Pershing X, a Startup Out to Replace Advisor Tech Stacks, Economist Jason Furman Explains How Inflation Snuck Up on Us and Whats Ahead in 2022, A Mountaineer CEO Talks Infinity Multiples, Thrill-Seeking, and How Advisors Need to Change, Modern Slavery Act Transparency Statement. PDF Case Plaintiff Defendant - United States Courts Early life James McDonald was born in Wellhead, Morayshire, in north Scotland on September 23 1840. Fair question. We represent investors in claims against negligent brokers and brokerage firms. By Greg Bartalos February 05, 2021 James McDonald (Courtesy photo) One hundred million viewers are expected to tune into Sunday's Super Bowl between the defending champion Kansas City Chiefs and Tampa . The Hercules Fund aims to generate positive returns during times of rising and falling stock markets. And debt has spiraled over 50% higher to GDP than where we were last year this time. One hundred million viewers are expected to tune into Sundays Super Bowl between the defending champion Kansas City Chiefs and Tampa Bay Buccaneers. However, as markets continue to thrive, our fund will not follow the path of other downside protection strategies, passive only strategies, which fall precipitously in rising market. Hercules CEO, CNBC Pundit 'In Hiding' Amid Securities Fraud Charges James Arthur McDonald Jr. appears to be on the lam as he faces as much as 20 years in prison for allegedly defrauding. Its two and 20 (fee arrangement) ensures that our portfolio management is in alignment with the profit objectives of the client. Im a football player disguised as a portfolio manager. Quotes displayed in real-time or delayed by at least 15 minutes. The potential for growth is there, but the conditions for growth are not because we are artificially providing income. Moneys thrown into the stock market, not just big caps, theres a whole surge of investing that weve seen, maybe with the beginning of the online trading movement, where there are pockets of individual investors who have moved into investing in a way that is creating tons of frothiness. Your email address will not be published. Are you suggesting that widespread economic weakness will eventually bubble up to drag down these indexes? Ryan Thomas Gosling (born November 12, 1980) is a Canadian actor. James Arthur McDonald Jr., 50, was charged with one count of fraud for bilking clients out of millions of dollars on Sept. 21, 2022. In this episode, David Armstrong, editor-in-chief at WealthManagement.com, talks to Hercules Investments James McDonald. The complaint also charges McDonald with violating Section 206(4) of the Advisers Act and Rule 206(4)-8 thereunder, which prohibit certain transactions by investment advisers. McDonald allegedly raised over $5 million and misappropriated funds for personal expenses and Ponzi-like payments. "I spoke to Mr Sonn on a complex legal matter. Our objective is to generate $10 billion for our clients in order for me to buy my football team. Tax Advantages Are a Selling Point for Investment in CRE. Hercules Investments was awarded the WealthManagement.com 2020 Alternative Asset Manager of the year. Hercules Investments has named Loreal McDonald as corporate counsel and interim chief operating officer. He appeared as a financial expert on TV. And so, this is artificial. And weve seen, recent examples of how the concentrated energy of small investors can make headlines. Because in addition to unemployed, he can also now call himself whistleblower.. 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