We represent investors in claims against negligent brokers and brokerage firms. Furthermore, index options provide compelling risk/return profiles with substantially less risk and volatility than their stock option counterparts.". Web page addresses and e-mail addresses turn into links automatically. More on that later. from 8 AM - 9 PM ET. But stimulating growth is impossible if the economy isnt open. 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. All rights reserved. And I think that that is much of whats happened in the macro as well. We are able to provide uncorrelated growth, meaning our strategies do not depend on equity markets continuing to rise in order to accomplish gains. Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox. Legal Statement. Hercules offers qualified clients market neutral portfolio management executed primarily through domestic index options. 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. 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. And, now that you, the Justice Department and the SEC mention it, a lot of his stories sound a bit hard to believe. 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. James McDonald, CEO of Hercules Investments, is using equity index options to profit from an expected surge in volatility and market swings. If you or your loved one experienced investment losses, we are here to help. The uncertainty around COVID-19 and risks of rising inflation were the impetus for launching the fund. 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. - Strategies to profit from a stock market decline Hi, James. All Rights Reserved. Lets wrap up with football. South Ozone Park, New York, United States View. 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. With only a few times in history have we had a gap even approaching these levels of GDP growth, equity market prices, corporate profits, equity market prices and PE ratios. In the S&P 500, you have mega cap tech Covid winners like Microsoft, Amazon, etc. The potential for growth is there, but the conditions for growth are not because we are artificially providing income. 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. Top Hercules Investments Employees James McDonald Chief Executive Officer. I'm Jeff Sonn, an attorney concentrating on securities fraud and consumer class actions. And I think that that will trigger selling of portfolios that have had extensive gains, particularly in the past six months. Charles Canter will lead the litigation. 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. For more information, please see www.hercules-investments.com, Media Contact: Matt Yemma Peaks Strategies 909-633-9396 [emailprotected], Cision Distribution 888-776-0942 Thats why our ticker is NFLHX. Unless you are aiming for simultaneous knocks on the door from the FBI, SEC and CFTC. We deliver these strategies through NFLHX. And so, we had that crash and then the desire and the interest in moving back forward. Got a confidential news tip? McDonald graduated from Harvard University with a Bachelors degree in Economics. He earned a bachelor's degree in economics from Harvard University. 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. Are you suggesting that widespread economic weakness will eventually bubble up to drag down these indexes? Data is a real-time snapshot *Data is delayed at least 15 minutes. 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. Hercules Investments specializes in actively managed and systematic investment strategies to monetize investment performance from equity market volatility. And while recognizing that each investors needs are distinct, on balance what percentage of a portfolio should this comprise? "These are incredibly uncertain times for the stock market and for investors," said James. Recent filings for HERCULES INVESTMENTS LLC 28 Jun 2019 SI-COMPLETE view 8 Jun 2019 REGISTRATION view Now he's wanted on fraud charges. 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,. The SEC filed a civil injunctive action against James Arthur McDonald, Jr. and Hercules Investments, LLC in relation to fraudulent securities offerings. Mutual Fund and ETF data provided by Refinitiv Lipper. Contact me online or call anytime at 844-689-5754. Registered in England and Wales. Powered and implemented by FactSet Digital Solutions. One hundred million viewers are expected to tune into Sundays Super Bowl between the defending champion Kansas City Chiefs and Tampa Bay Buccaneers. So, common sense would say, what changed in one year for a 50% premium in a market that most people would agree has been propelled with no monetary policy and stimulus? No, Brent Kovars mother didnt have an artificial intelligence supercomputer in her basement, the SEC says. So, I got to root for Tom Brady because any 40-plus football player is one I admire. I think we will have another risk event that pulls the market down. Unlike hedge funds, however, a mutual fund is accessible to individual investors and their advisors in a very transparent package. Absolutely. 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. In a parallel action, the United States Attorney's Office for the Central District of California announced criminal charges against McDonald. Your email address will not be published. A CNBC spokesperson told USA TODAY the network no longer allowed McDonald on the air as soon it found out he was under investigation. 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 . He appeared as a financial expert on TV. Do you still have a 15,000 target on the Dow? or redistributed. Hercules Investments has named Loreal McDonald as corporate counsel and interim chief operating officer. My dream is to buy an NFL team. 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. Small businesses are suffering tremendously, and theyre always going to be the engine of growth for the economy. Subscribe to RIA Intels thrice-weekly newsletter and follow the publication on Twitter and LinkedIn. "I spoke to Mr Sonn on a complex legal matter. 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. Subscribe to RIA Intels thrice-weekly newsletter.]. And we know that this isnt how a strong economy operates. Get James McDonald's email address (j*****@post.harvard.edu) and phone number (718848..) at RocketReach. Or before an SEC investigator. The SEC's complaint, which was filed in the Central District of California, charges McDonald and Hercules 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. So, I think over 75% of the gains in the S&P 500 in 2020 could be attributed to a handful of names. The breadth of risk is extremely wide. Investment adviser firms registered with the SEC may be required to provide to state securities authorities a copy of their Form ADV and any accompanying amendments filed with the SEC. Very few recessions and market collapses have recovered in the time period that we saw in 2020. [USA Today]. 4 . Ryan Thomas Gosling (born November 12, 1980) is a Canadian actor. The PE has risen by about 50% from a year ago. 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. Contact our office today to discuss your case. Because bulls point to loads of liquidity, low rates, and solid earnings and guidance. A conversation about economies, markets, wage inequality, Congress, crypto, and more. The attorneys at ChapmanAlbin are licensed to practice law in Ohio and Michigan. Check out what's clicking on Foxnews.com. The fund is for qualified investors only, and as such mimics many of the features of a hedge fund strategy. Its two and 20 (fee arrangement) ensures that our portfolio management is in alignment with the profit objectives of the client. I think the phenomena is an anomaly like virtually every pocket of life were in right now. All rights reserved. And debt has spiraled over 50% higher to GDP than where we were last year this time. Then its fine. Fair question. Fox News Flash top headlines are here. Hercules applies quantitative research to design and actively manage portfolios for investors seeking maximum growth during up or down-market cycles. This funds fees accelerate when its performance accelerates. On 11/16/2021 HERCULES INVESTMENTS, LLC filed a Contract - Business lawsuit against DANNY MICHAEL CORRAL. 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. You can reach us by phone at 844-689-5754 or via e-mail. We fight to level the playing field between large corporations and the public investor. 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. Our ability to monetize volatility is exceptional as evidenced by our winning WealthManagement.coms 2020 Wealthies Award as top Alternative Asset Manager. The CEO and chief investment officer of Hercules Investment, a Los Angeles-based RIA, saw his college football career cut short by a catastrophic knee injury that sidelined him for 15 years. It wasn't immediately clear whether he had an attorney who could speak on his behalf. PDF Case Plaintiff Defendant - United States Courts Early life James McDonald was born in Wellhead, Morayshire, in north Scotland on September 23 1840. Save my name, email, and website in this browser for the next time I comment. Vaccinating the public will not happen as quickly as most expect. Things are escalating quickly for the folks behind StraightPath Venture Partners. The case status is Pending - Other Pending. Buckhead Tower, Suite 400 3399 Peachtree Rd. 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 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. It takes time to get back up, but we have had renewed waves of lockdowns in the fall and layoffs. Your email address will not be published. Questions? A Division of NBCUniversal. WealthManagement.com Staff | Nov 05, 2020. Key stock indexes, which are market cap based, are near record highs. Please read our Terms and Conditions, Modern Slavery Act Transparency Statement, and Privacy Policy before using the site. The S&P 500 is trading at about 23 times projected forward earnings. This fund is for qualified investors only. 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. 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. Hercules Investments won a 2020 Wealthies Award for being the top Alternative Asset Manager. Address of QUALITY servIce and relIable guarding, We are constantly workIng and developng to mprove our qualIty of servce. Its an all-weather strategy. 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. Market data provided by Factset. How does it factor into your life? Volatility itself could be owned through a number of securities. Having traded more than $10 billion worth of options in his 26-year career, McDonald says speculative excess is rampant, citing bitcoin, the SPAC boom, Reddit/GameStop, and elevated valuations. In this virtual event, McDonald shares: - Why the markets are too optimistic about the Covid-19 vaccine The Judge overseeing this case is MARGARET MILLER BERNAL. 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. 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 . This site contains attorney advertising. James Arthur McDonald Jr., 50, was charged with one count of fraud for bilking clients out of millions of dollars on Sept. 21, 2022. 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. I really enjoyed speaking with you and appreciate you taking the time. Its clock-striking-midnight dealmaking time at the Justice Department. We do this because we invest in index options, which give us the flexibility to purchase contracts that rise in value when markets fall and to own very misunderstood and often overlooked asset class volatility. Founded on May 26, 2005, GESCO provides private and corporate security services in various regions of the country including Baku, in accordance with the requirements of ISO 9001, ISO 14001, ISO 45001. Quotes displayed in real-time or delayed by at least 15 minutes. Its not a doomsday picture, but markets are priced right now as if all economic engines are fully up and running. The SEC's complaint alleges that McDonald raised over $3.6 million from investors between May 2019 and October 2021 for the stated purpose of trading securities through an investment vehicle called the Index Strategy Advisors Fund, and that McDonald used less than half those funds for trading and did not engage in any trading with the funds for long stretches of time. That would be a doubling from the low. "Robust, quant driven investment strategies are typically only available to Ultra High Net Worth individuals and families with $25 million or more to invest. NE Atlanta, GA 30326 *by appointment only. Hercules Investments was founded by James McDonald, who previously was founder and CEO of Index Strategy Advisors. . I think we will retest the previous lows of last March before buying comes back in. Our specialization in volatility is what sets us apart because there are many funds and strategies which offer potential gains in a declining market, but as passive indexes or passive strategy, they are bound to lose money when markets are flat or rising. Tune in to discover different ways that Hercules Investments can provide you with overlay strategies while giving you market volatility protection! Its like a freight train that cant come to an exact halt without a crash. The 10 Best and 10 Worst States in Which to Retire in 2021, Im an Advisor. CHICAGO--(BUSINESS WIRE)--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 2021 Stock Market Crash, on Thursday, January 14, 2021 at 3pm EST. How Should HNW Investors Think About Them? *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. The Hercules investment team features investment professionals averaging over 20+ years of experience . To what extent do multiples deserve to be elevated given ultralow interest rates? We want to hear from you. The economy is slowly reopening and more vaccines are reaching people. 2023 FOX News Network, LLC. I think all the equity markets are so overstretched that when a risk element enters the market, the selling will be violent and accelerated. Get this delivered to your inbox, and more info about our products and services. Prosecutors allege that McDonald concealed massive financial losses from some clients and used some investment money for personal expenses, spending some of it at a Porsche dealership and on a website that sells designer menswear. The Fund seeks to implement very short-term long and short positions in call and put options on the main US stock . - 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. 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. Any reference to past cases or successes made herein should not be construed as a guarantee of any future outcome. This material may not be published, broadcast, rewritten, Mr. McDonald previously was CEO/CIO of Index Strategy Advisors Inc. (ISA) from 2010-2019. In summary, NFLHX provides direct access to risk hedged growth adding a layer of insurance to a portfolio that has appreciated with the market. With interest rates so low, what do you make of the TINA argument, which asserts there is no alternative to stocks? 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.. 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 Investments was founded by James McDonald, who previously was founder and CEO of Index Strategy Advisors. 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. RIA Intel is part of the Euromoney Institutional Investor PLC group. These filings are called "notice filings". 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. Lines and paragraphs break automatically. McDonald also allegedly raised over $3.5 million for securities trades through . (Jun 1986 - Sep 2016) 101 Royal Park Dr. Oakland Park, FL 33309. 165 Broadway 23rd Floor New York City NY, 10006 *by appointment only. This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. McDonald allegedly raised over $5 million and misappropriated funds for personal expenses and Ponzi-like payments. Our employees and their family members enjoyed a wonderful time together this morning at PureTrack in Anaheim, CA! 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. James Arthur McDonald Jr., 50, ran two Los Angeles-based investment firms called Hercules Investments and Index Strategy Advisors. McDonald graduated from Harvard University with a Bachelor's degree in Economics. Thats my personal mission. 2023 RIA Intel, an Institutional Investor Publication. Quotes displayed in real-time or delayed by at least 15 minutes. The Sonn Law Group is currently investigating allegations surrounding James Arthur McDonald, Jr. or Hercules Investments, LLC. 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. Mutual Fund and ETF data provided by Refinitiv Lipper. My dream was always to play in the NFL and thats going to be my ticket. The SEC filed a civil injunctive action against James Arthur McDonald, Jr. and Hercules Investments, LLC in relation to fraudulent securities offerings. // Disclaimer. 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. Do you have your eyes on any team per se? 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. Number 8860726. This seriously cut in to his fee income, and CNBC appearance feesoh, yes, he was still bloviating on television about on how people should invest for more than a year-and-a-half after the most spectacular wrong call of his careerapparently dont cover the Porsches or the rent, so he decided to raise some more. 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. Fox News Flash top headlines for September 22. I would be thrilled to buy the Washington football team because I grew up in Chevy Chase, Maryland. 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. Today, his ambition is to own a NFL team. 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. Legal Statement. 2023 FOX News Network, LLC. PHILADELPHIA COP WHO SHOT UNARMED BLACK MOTORIST BEGINS TRIAL. And what were seeing now is bull market enthusiasm and all types of signs of bubbles in asset prices. Our strategies offer downside protection and even potential upside gains with protracted market downturns. And when we look at unemployment now, we say its recovered, but the recovery hasnt brought sufficient growth. His demeanor was professional and pleasant and I would not hesitate to use him in future matters. Wealth Management is part of the Informa Connect Division of Informa PLC. For a free consultation, please call us now at 866-827-3202or complete ourcontact form. 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 affidavit of service states that the summons and complaint were served on James McDonald by service to Beatriz Lima, "as person in charge of the place of business / authorized to accept service on behalf of Hercules Investments, LLC, a California limited liability company at 1718 18 Harriman Lane, #A, Redondo Beach, CA 90278." Each client and each clients case is unique, and no result or outcome is or can ever be guaranteed. "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. 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. 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. 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. Im going to play on my own team and practice. This Book Changed My Life, Fifteen Must-Listen Business Podcasts for Advisors, Celebrity Estates: Jay Leno and Planning for Classic Car Collections. McDonald allegedly raised over $5 million and misappropriated funds for personal expenses and Ponzi-like payments. Founded on May 26, 2005, GESCO provides private and corporate security services in various regions of the country including Baku, in accordance with the requirements of ISO 9001, ISO 14001, ISO 45001. [Like this article? And so, this is artificial. Hercules Investments chief investment officer James McDonald used to be a familiar face on CNBC, pontificating about market matters as an expert thereon. 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 Powered and implemented by FactSet Digital Solutions. 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. Quant Research-Driven Investment Strategies For Investors Seeking Active Portfolio Management. 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. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. 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. The bear case is that the effects of the shutdowns havent fully been realized yet. 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 Actually, he didnt just assume it: He bet his clients money rather heavily on it, and lost them upwards of $40 million doing so. Previously, McDonald was of counsel to Gary, Williams, Parenti, Watson & Gary, P.L.LC. 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. He last appeared on the network in July 2021. 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. For more information, please visit: https://hercules-investments.com/hercules-public/index.html, Media Contact Required fields are marked *. This case was filed in Los Angeles County Superior Courts, Norwalk Courthouse located in Los Angeles, California. 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: . Please note: We are unable to take cases with losses of less than $50,000. Also on Wednesday, the U.S. Securities and Exchange Commission filed a civil complaint charging McDonald and Hercules with violations of federal securities law. And so, if the market falls say 10%, our allocations will potentially offset the losses in the long only portfolio. My intention when I buy my team is to get on the practice field and hit those guys! 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. https://www.wealthmanagement.com/sites/wealthmanagement.com/files/logos/Wealth-Management-Logo-white.png. When typing in this field, a list of search results will appear and be automatically updated as you type. Whats your takeaway from GameStop, AMC, Blackberry, etc.? Our objective is to generate $10 billion for our clients in order for me to buy my football team. What should advisors know about your firm and how you can help them? I played semi-pro football for 12 years. 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 . "There's a disconnect between Main Street and Wall Street, but we had to do it. McDonald will also be speaking at The Executives Club of Chicagos 2021 Annual Economic Outlook virtual event on January 14. 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. 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. 2023 Informa USA, Inc., All rights reserved, In this episode, David Armstrong, editor-in-chief at. Fri, Feb 12. 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. This field is for validation purposes and should be left unchanged. In a portfolio with a beta of one, one would enjoy virtually 100% downside protection with an allocation of 15% to the Hercules fund. To ensure the most secure and best overall experience on our website we recommend the latest versions of, Internet Explorer is no longer supported. McDonald, who lived in the Los Angeles suburb of Arcadia, is believed to be in hiding, the statement said. The complaint seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against McDonald and Hercules. And so, equity market prices are assuming earnings that arent there. McDonald, who faces up to 20 years imprisonment if convicted, is believed to be in hiding, the U.S. Attorneys office said in a news release. In 2005 he purchased the Houston Wolverines (the Texas Wolverines today), a semi-pro football team, and played for 13 years. Yes. The Hercules Fund aims to generate positive returns during times of rising and falling stock markets. "-Sonn Law Group Client. 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. James McDonald, CEO and Chief Investment Officer of Hercules Investments, will serve as Portfolio Manager of the Hercules Fund. 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 . 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. And this is evidenced by us being at valuation levels weve never touched before, even higher than 1929 and 2000-2001. Below are excerpts from our Jan. 28 discussion, edited for length and clarity. 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. There are hundreds of companies in the small cap space that dont have the cash to pay their debt. 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. We had to save the economy from going off the cliff with us not being able to operate as normal," McDonald said. Lets start with your macro view. He was direct and asked all the questions that were relevant and provided me with very thoughtful feedback and some useful contacts. But I think that the market will rebound and potentially finish the year slightly higher. Whats the bear case predicated on? 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. 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. What the Fed did was to protect the economy from going into the abyss. 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 SEC appreciates the assistance of the U.S. Attorney's Office, the Federal Bureau of Investigation, and the Internal Revenue Service-Criminal Investigation Division. CHICAGO JUDGE DENIES BAIL FOR ILLINOIS WOMAN WHO ALLEGEDLY PUSHED 3-YEAR-OLD NEPHEW INTO LAKE MICHIGAN. It means that sentiment and greed can move a market in the face of asking for fundamental justification in the short term. 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. Arcadia Man Charged with Securities Fraud for Stealing Client Funds and Concealing His Investment Firms Massive Financial Losses. 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. Employment levels have increased slightly, but we are artificially keeping our economy going with stimulus checks and obviously all of the Feds actions. Describe the ideal client profile. Youre describing a giant disconnect between the markets and small businesses that are in a world of hurt. 2023 CNBC LLC. We can deliver these same strategies to investor portfolios with less than $1 million," said Mr. McDonald, Chief Executive Officer of Hercules and previous winner of the Top 10 Advisors Rising Stars award from ETF Report magazine. This material may not be published, broadcast, rewritten, or redistributed. You've successfully subscribed to this newsletter! And so, the gains that weve seen have come based on an enthusiasm and optimism placed across the entire market. It is a risk-hedged growth mutual fund that captures market appreciation and has the potential for great gains when markets fall.