In a portfolio with a beta of one, one would enjoy virtually 100% downside protection with an allocation of 15% to the Hercules fund. Its like a freight train that cant come to an exact halt without a crash. A frequent lecturer and conference speaker, he is a nationally-recognized expert on the topics of macroeconomics, event-driven investing, growth investing, portfolio construction, index investing, exchange-traded funds, digital currencies, and index . In this virtual event, McDonald shares: - Why the markets are too optimistic about the Covid-19 vaccine 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. 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. And even still, there is the risk of mutations, the continuation of sickness, hospitalizations, and fear will cause stagnation for the reopening concept. This material may not be published, broadcast, rewritten, or redistributed. Yeah. AssetMark CEO Charles Goldman tells RIA Intel that he is focused on acquisitions, helping advisors, and the long term. "Robust, quant driven investment strategies are typically only available to Ultra High Net Worth individuals and families with $25 million or more to invest. Its an all-weather strategy. Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox. The actual profits that have been generated and the guidance that has increased are based on a small section of the market. 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. The United States Securities and Exchange Commission subpoenaed McDonald to testify before it in November 2021, but - without advance notice - he failed to appear as required. And we know that this isnt how a strong economy operates. This site contains attorney advertising. The United States Securities and Exchange Commission subpoenaed McDonald to testify before it in November 2021, but without advance notice he failed to appear as required. 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. James McDonald, CEO of Hercules Investments, is using equity index options to profit from an expected surge in volatility and market swings. The attorneys at ChapmanAlbin are licensed to practice law in Ohio and Michigan. All rights reserved. The SEC's investigation was conducted by David S. Brown, Carol Kim, and Matthew O. Koop and was supervised by Marc J. Blau in the Los Angeles Regional Office. The Securities and Exchange Commission today announced the filing of a civil injunctive action against James Arthur McDonald, Jr. and his SEC-registered investment adviser firm, Hercules Investments, LLC in connection with two fraudulent securities offerings. [USA Today]. That would be a doubling from the low. Volatility itself could be owned through a number of securities. Or, you know, anywhere, really. McDonald allegedly raised over $5 million and misappropriated funds for personal expenses and Ponzi-like payments. The complaint also alleges that McDonald commingled the investor funds with Herculess assets and his personal assets, and used $440,000 of those funds for personal expenses, including to pay his personal credit card bills. In 2005 he purchased the Houston Wolverines (the Texas Wolverines today), a semi-pro football team, and played for 13 years. Lines and paragraphs break automatically. And I think that that will trigger selling of portfolios that have had extensive gains, particularly in the past six months. According to the complaint, McDonald also appears to have terminated his previous phone and email accounts and told one person that he planned to vanish.. Sign up for free newsletters and get more CNBC delivered to your inbox. This Book Changed My Life, Fifteen Must-Listen Business Podcasts for Advisors, Celebrity Estates: Jay Leno and Planning for Classic Car Collections. In summary, NFLHX provides direct access to risk hedged growth adding a layer of insurance to a portfolio that has appreciated with the market. The Sonn Law Group is currently investigating allegations surrounding James Arthur McDonald, Jr. or Hercules Investments, LLC. Data is a real-time snapshot *Data is delayed at least 15 minutes. Environmental, Social and Governance (ESG), HVAC (Heating, Ventilation and Air-Conditioning), Machine Tools, Metalworking and Metallurgy, Aboriginal, First Nations & Native American. I think we will retest the previous lows of last March before buying comes back in. 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. Mutual Fund and ETF data provided by Refinitiv Lipper. Very few recessions and market collapses have recovered in the time period that we saw in 2020. In early 2021, McDonald "solicited millions of dollars worth of funds from investors in the form of a purported capital raise for Hercules but misrepresented how the funds would be used and failed to disclose the massive losses Hercules previously sustained," the statement said. Unfortunately, according to the Justice Department and SEC, he didnt tell those new investors about all the money he lost on the election, nor precisely what he was going to do with it, as dropping $174K at a Porsche dealership and paying $110K to his landlord are not the same thing as launching a mutual fund. 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. And so, if the market falls say 10%, our allocations will potentially offset the losses in the long only portfolio. The S&P 500 is trading at about 23 times projected forward earnings. Things are escalating quickly for the folks behind StraightPath Venture Partners. 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. But I think that the market will rebound and potentially finish the year slightly higher. Get James McDonald's email address (j*****@post.harvard.edu) and phone number (718848..) at RocketReach. A CNBC spokesperson told USA TODAY the network no longer allowed McDonald on the air as soon it found out he was under investigation. or redistributed. We fight to level the playing field between large corporations and the public investor. Mutual Fund and ETF data provided by Refinitiv Lipper. Charles Canter will lead the litigation. 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.. 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. The Fund seeks to implement very short-term long and short positions in call and put options on the main US stock . Unlike hedge funds, however, a mutual fund is accessible to individual investors and their advisors in a very transparent package. "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. https://www.wealthmanagement.com/sites/wealthmanagement.com/files/logos/Wealth-Management-Logo-white.png. Absolutely. James Arthur McDonald Jr., 50, was charged with one count of fraud for bilking clients out of millions of dollars on Sept. 21, 2022. He appeared as a financial expert on TV. How Should HNW Investors Think About Them? McDonald graduated from Harvard University with a Bachelors degree in Economics. And so, the breadth of success is extremely narrow. 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. The gap between corporate profits and GDP, or even corporate profits and equity market prices, is wider than its ever been by a long way. Got a confidential news tip? Hercules offers qualified clients market neutral portfolio management executed primarily through domestic index options. Key stock indexes, which are market cap based, are near record highs. Arcadia Man Charged with Securities Fraud for Stealing Client Funds and Concealing His Investment Firms Massive Financial Losses [press release]He appeared as a financial expert on TV. Number 8860726. 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. Contact our office today to discuss your case. (Jun 1986 - Sep 2016) 101 Royal Park Dr. Oakland Park, FL 33309. 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. Its clock-striking-midnight dealmaking time at the Justice Department. Resilience is the name of the game, says Mastercard CEO Michael Miebach, We've seen resilience in the U.S. consumer, says Coca-Cola CEO James Quincey, Illinois Governor JB Pritzker: Crime is coming down gradually in the city and it's getting better, Guggenheim CIO: We are predicting the recession to start mid-year, Moderna CEO: We're preparing our FDA filing for our RSV vaccine. Hercules' portfolios are designed to achieve aggressive gains whether markets are rising or falling. Hercules Investments CEO/CIO James McDonald. McDonald will also be speaking at The Executives Club of Chicagos 2021 Annual Economic Outlook virtual event on January 14. No, Brent Kovars mother didnt have an artificial intelligence supercomputer in her basement, the SEC says. McDonald falsely represented that investor funds would be used to expand Herculess business, lied about the firms financial condition, and failed to disclose that he had promised Hercules clients that the firm would repay earlier losses. Subscribe to RIA Intels thrice-weekly newsletter and follow the publication on Twitter and LinkedIn. Below are excerpts from our Jan. 28 discussion, edited for length and clarity. Please read our Terms and Conditions, Modern Slavery Act Transparency Statement, and Privacy Policy before using the site. Prominent in independent film, he has also worked in blockbuster films of varying genres, and has accrued a worldwide box office gross of over 1.9 billion USD.He has received various accolades, including a Golden Globe Award, and nominations for two Academy Awards and a BAFTA Award.. Born and raised in Canada, he rose to . GESCO is a security company operating in various fields and basing on the principle of physical protection. 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, a Los Angeles-based Registered Investment Advisor.Hercules applies quantitative research to design and actively manage portfolios for investors seeking maximum growth during up or down-market cycles. Quotes displayed in real-time or delayed by at least 15 minutes. James McDonald is a 25-year veteran of the investment industry and was named one of America's top 10 investment advisors by ETF.com in 2012. Tax Advantages Are a Selling Point for Investment in CRE. Our employees and their family members enjoyed a wonderful time together this morning at PureTrack in Anaheim, CA! 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. 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. Quotes displayed in real-time or delayed by at least 15 minutes. It is a risk-hedged growth mutual fund that captures market appreciation and has the potential for great gains when markets fall. I think the phenomena is an anomaly like virtually every pocket of life were in right now. The SECs complaint alleges that McDonald raised over $3.6 million from investors between May 2019 and October 2021, which he told investors would be used to trade securities through an investment vehicle called the Index Strategy Advisors Fund. The SEC further alleges that, from February 2021 to October 2021, McDonald raised $1.5 million through the sale of equity investments in Hercules's business. The SECs complaint charges McDonald with violating the antifraud provisions of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and Sections 206(1) and 206(2) of the Investment Advisers Act of 1940. And so, the gains that weve seen have come based on an enthusiasm and optimism placed across the entire market. "There's a disconnect between Main Street and Wall Street, but we had to do it. My dream is to buy an NFL team. The equity markets have behaved puzzlingly well in 2020 with the backdrop of a global pandemic and lots of uncertainty around the evolution of the coronavirus and its impact on small businesses, households, and way of life. PDF Case Plaintiff Defendant - United States Courts Early life James McDonald was born in Wellhead, Morayshire, in north Scotland on September 23 1840. My dream was always to play in the NFL and thats going to be my ticket. 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. Subscribe to RIA Intels thrice-weekly newsletter.]. McDonald, who graduated from Harvard University with an economics degree, expects the Dow will tumble more than 50% to 15,000, a prediction he has made several times since March 2020, before surging to new highs this year. This funds fees accelerate when its performance accelerates. Previously, McDonald was of counsel to Gary, Williams, Parenti, Watson & Gary, P.L.LC. For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker. If markets rise, our fund is managed to match or exceed that growth based on our ability to go long or short with index options. 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