Below are excerpts from our Jan. 28 discussion, edited for length and clarity. Hercules Investments specializes in actively managed and systematic investment strategies to monetize investment performance from equity market volatility. Powered and implemented by FactSet Digital Solutions. Do you have your eyes on any team per se? 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. Hercules Investments was founded by James McDonald, who previously was founder and CEO of Index Strategy Advisors. 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. 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. I think the phenomena is an anomaly like virtually every pocket of life were in right now. Subscribe to RIA Intels thrice-weekly newsletter and follow the publication on Twitter and LinkedIn. 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. Its clock-striking-midnight dealmaking time at the Justice Department. Got a confidential news tip? It means that sentiment and greed can move a market in the face of asking for fundamental justification in the short term. Its like a freight train that cant come to an exact halt without a crash. Legal Statement. Hercules' portfolios are designed to achieve aggressive gains whether markets are rising or falling. 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. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Please read our Terms and Conditions, Modern Slavery Act Transparency Statement, and Privacy Policy before using the site. Check out what's clicking on Foxnews.com. And so, this is artificial. 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. This material may not be published, broadcast, rewritten, or redistributed. 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. . 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. But stimulating growth is impossible if the economy isnt open. How Should HNW Investors Think About Them? Below are the states with which the firm you selected makes its notice filings. Fri, Feb 12. Fox News Flash top headlines for September 22. 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 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. from 8 AM - 9 PM ET. This case was filed in Los Angeles County Superior Courts, Norwalk Courthouse located in Los Angeles, California. Hercules Investments has named Loreal McDonald as corporate counsel and interim chief operating officer. Quotes displayed in real-time or delayed by at least 15 minutes. 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. 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. His demeanor was professional and pleasant and I would not hesitate to use him in future matters. PHILADELPHIA COP WHO SHOT UNARMED BLACK MOTORIST BEGINS TRIAL. In this virtual event, McDonald shares: - Why the markets are too optimistic about the Covid-19 vaccine But I think that the market will rebound and potentially finish the year slightly higher. "In our view, index options are a far more efficient and low- cost way to implement growth strategies for client portfolios compared with using funds or individual stocks. All rights reserved. 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. Actually, he didnt just assume it: He bet his clients money rather heavily on it, and lost them upwards of $40 million doing so. Any reference to past cases or successes made herein should not be construed as a guarantee of any future outcome. I think we will have another risk event that pulls the market down. 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. 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. These filings are called "notice filings". Then its fine. The S&P 500 is trading at about 23 times projected forward earnings. 2023 CNBC LLC. I would be thrilled to buy the Washington football team because I grew up in Chevy Chase, Maryland. The complaint seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against McDonald and Hercules. 2023 Informa USA, Inc., All rights reserved, In this episode, David Armstrong, editor-in-chief at. And what were seeing now is bull market enthusiasm and all types of signs of bubbles in asset prices. The attorneys at ChapmanAlbin are licensed to practice law in Ohio and Michigan. That would be a doubling from the low. 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 . Or, you know, anywhere, really. Hercules Investments was awarded the WealthManagement.com 2020 Alternative Asset Manager of the year. I think all the equity markets are so overstretched that when a risk element enters the market, the selling will be violent and accelerated. Powered and implemented by FactSet Digital Solutions. And so, equity market prices are assuming earnings that arent there. When we perform well for the client, we perform well for ourselves. Now, there are a handful of companies that have flourished in the Covid era, but its a handful of companies. 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. My dream was always to play in the NFL and thats going to be my ticket. Top Hercules Investments Employees James McDonald Chief Executive Officer. The 10 Best and 10 Worst States in Which to Retire in 2021, Im an Advisor. A Division of NBCUniversal. "-Sonn Law Group Client. or redistributed. With this risk in the market, many individual investors have to count on either continued paid stimulus or continued paychecks and loans for small business relief. Because in addition to unemployed, he can also now call himself whistleblower.. And so, my passion and focus in trading is very personal and Im committed to generating profits for my clients with a motivation that goes far beyond investing. Of course, we know that theres tremendous risk, not just to our health, but to the sustainability of small businesses, to the credit and economic security of households and to the outlook for how we will move forward past the pandemic. (Jun 1986 - Sep 2016) 101 Royal Park Dr. Oakland Park, FL 33309. I think we will retest the previous lows of last March before buying comes back in. Additionally, McDonald raised $1.5 million through equity investment sales in Hercules business while lying, failing to disclose important facts, and more. How Hercules Investments capitalizes on systematic volatility; The companys risk-hedging technique designed to help financial advisors and clients; How James McDonalds firm helps financial advisors grow their prospects; Hercules Investments ideal client as those who got aggressive growth goals; Allowed HTML tags: . Today, his ambition is to own a NFL team. Recent filings for HERCULES INVESTMENTS LLC 28 Jun 2019 SI-COMPLETE view 8 Jun 2019 REGISTRATION view - Why volatility as an asset class is key for 2021, Its important for investors to be prepared for stock market volatility, as the economic outlook remains fragile in 2021, McDonald said. What the Fed did was to protect the economy from going into the abyss. GESCO combines international experience and quality standards with modern technologies and opportunities and local professional service. 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. GESCO is a security company operating in various fields and basing on the principle of physical protection. To send us an e-mail, simply complete and submit the online form below. Believe It or Not, Its a Great Time To Be a Financial Advisor, Ares Strikes Deal for Office, Naming Rights at Los Angeles Tower, Musks Twitter Sells Off Coffee Makers, Neon Logo in Auction Blitz. 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. 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. We are able to provide uncorrelated growth, meaning our strategies do not depend on equity markets continuing to rise in order to accomplish gains. Your email address will not be published. To ensure the most secure and best overall experience on our website, we recommend the latest versions of, https://us02web.zoom.us/webinar/register/WN_guvDkdmgQcy4-HcSuTnb1Q, https://hercules-investments.com/hercules-public/index.html. Fair question. Tax Advantages Are a Selling Point for Investment in CRE. Vaccinating the public will not happen as quickly as most expect. 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. Employment levels have increased slightly, but we are artificially keeping our economy going with stimulus checks and obviously all of the Feds actions. James McDonald Current Workplace Hercules Investments Location 633 W 5th St Ste 6770, Los Angeles, California, 90071, United States Description Read More Industry Finance General Finance Discover more about Hercules Investments James McDonald Work Experience and Education Work Experience Chief Investment Officer Vishnu Wealth Management 2017-2019 Address of QUALITY servIce and relIable guarding, We are constantly workIng and developng to mprove our qualIty of servce. This material may not be published, broadcast, rewritten, And I think that that will trigger selling of portfolios that have had extensive gains, particularly in the past six months. And, also, relatedly and with the prospect of decades in prison attach, conspiracy and fraud. In a parallel action, the United States Attorneys Office for the Central District of California announced criminal charges against McDonald. 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. 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. Federal prosecutors charged McDonald with one count of. James McDonald from Hercules Investments and James Camp, Eagle Asset Management director of strategic income and managing director of fixed income, discuss the impact of the $1.9 trillion coronavirus relief package to the stock and bond markets. Subscribe to RIA Intels thrice-weekly newsletter.]. He argues the stimulus package will fail to rehabilitate the economy and thinks investors are too sanguine about the vaccines rollout, citing logistics and trust issues surrounding the vaccine. 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 because of the COVID-19 pandemic and the results of the U.S. presidential election, the U.S. attorney's office said. 2023 FOX News Network, LLC. Small businesses are suffering tremendously, and theyre always going to be the engine of growth for the economy. You've successfully subscribed to this newsletter! Our strategies offer downside protection and even potential upside gains with protracted market downturns. This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Because bulls point to loads of liquidity, low rates, and solid earnings and guidance. 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.
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