Neuberger Berman Launches Dynamic Concentrated Stock Management Offering As Part Of Its Custom SMA Platform

New York, February 27, 2024 – Neuberger Berman, an employee-owned, private, independent investment manager, is pleased to announce that it will begin offering the Neuberger Berman Dynamic Concentrated Stock Management (NB DCSM) solution to its clients. The newly launched strategy offers investors with concentrated stock positions an innovative approach to diversify their portfolios while focusing on generating cash to pay the tax expenses associated with such a sale. Neuberger Berman’s Custom Direct Investing (NB CDI) platform has grown to manage $4.2B in AUM as of December 31, 2023 after first launching in January 2020.

With the DCSM launch, Neuberger Berman aims to solve a variety of challenges facing investors with concentrated stock positions. Traditionally, investors with a concentrated position would be burdened with staged selling to spread a tax bill, Exchange Funds that lack flexibility, options that immediately sacrifice upside of the stock position, or costs associated with borrowing against the concentrated position. With Neuberger’s DCSM solution, investors can directly transition a concentrated position to a tax-efficient equity strategy by generating cash to pay for the transition tax cost.

“Many of our clients have expressed a desire to reduce their exposure to concentration risks, or to simply diversify their portfolios, but have concerns about the tax implications of doing so,” said Jacob Greene, Head Strategist of Neuberger Berman Custom Direct Investing. “We’ve developed a unique program to transitioning clients into the custom-built and diversified strategies that our tax efficient investing platform is known for, by utilizing the program’s generated income to pay the tax liability associated with concentrated stock sales.”

Neuberger Berman’s capital-efficient approach requires no cash to fund this transition, does not borrow on margin, and instead creates utility in previously dormant assets. The firm’s modeling shows an ability to conservatively transition 50% of a concentrated position into a diversified portfolio in 3-6 years without requiring the client to pay out of pocket for the incurred taxes. This strategy will be managed and offered as part of Neuberger Berman’s Custom Direct Investing offering.

“Often we see concentrated stock positions dominate the risk profile of private client portfolios“ said Stephanie Luedke, CFA, Head of NB Private Wealth. “We are excited to offer our clients in NB Private Wealth the Dynamic Concentrated Stock Management program as an additional capability to enable meaningful risk management, tax efficiency, and the pursuit of well diversified investment portfolios. DCSM is another example of the powerful combination of investment innovation and generations of experience managing assets for taxable investors that Neuberger Berman has to offer.”

About Neuberger Berman

Neuberger Berman is an employee-owned, private, independent investment manager founded in 1939 with 2,800 employees in 26 countries. The firm manages $463 billion of equities, fixed income, private equity, real estate and hedge fund portfolios for global institutions, advisors and individuals. Neuberger Berman’s investment philosophy is founded on active management, fundamental research and engaged ownership. UNPRI named the firm a Leader, a designation awarded to fewer than 1% of investment firms for excellence in environmental, social and governance practices. Neuberger Berman has been named by Pensions & Investments as the #1 or #2 Best Places to Work in Money Management for each of the last ten years (firms with more than 1,000 employees). Visit www.nb.com for more information. Data as of December 31, 2023.

Media Contacts:

(Americas) Alex Samuelson, 212.476.5392, Alexander.Samuelson@NB.com