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. Lets start with your macro view. McDonald graduated from Harvard University with a Bachelor's degree in Economics. James Arthur McDonald Jr., 50, was charged with one count of fraud for bilking clients out of millions of dollars on Sept. 21, 2022. 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. 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 SEC filed a civil injunctive action against James Arthur McDonald, Jr. and Hercules Investments, LLC in relation to fraudulent securities offerings. 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. 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.. I'm Jeff Sonn, an attorney concentrating on securities fraud and consumer class actions. 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. 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. When typing in this field, a list of search results will appear and be automatically updated as you type. What should advisors know about your firm and how you can help them? Hercules offers qualified clients market neutral portfolio management executed primarily through domestic index options. 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. We are able to provide uncorrelated growth, meaning our strategies do not depend on equity markets continuing to rise in order to accomplish gains. Its two and 20 (fee arrangement) ensures that our portfolio management is in alignment with the profit objectives of the client. The S&P 500 is trading at about 23 times projected forward earnings. Instead, the SEC alleges, McDonald 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. That would be a doubling from the low. I think the phenomena is an anomaly like virtually every pocket of life were in right now. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. 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. PHILADELPHIA COP WHO SHOT UNARMED BLACK MOTORIST BEGINS TRIAL. This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. The fund is for qualified investors only, and as such mimics many of the features of a hedge fund strategy. Now, there are a handful of companies that have flourished in the Covid era, but its a handful of companies. The PE has risen by about 50% from a year ago. 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. Ryan Thomas Gosling (born November 12, 1980) is a Canadian actor. 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. 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 we know that this isnt how a strong economy operates. 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. 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. Hercules Investments was founded by James McDonald, who previously was founder and CEO of Index Strategy Advisors. Get James McDonald's email address (j*****@post.harvard.edu) and phone number (718848..) at RocketReach. 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. (Jun 1986 - Sep 2016) 101 Royal Park Dr. Oakland Park, FL 33309. scott@strategyvoiceassociates.com, Internet Explorer presents a security risk. 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. Web page addresses and e-mail addresses turn into links automatically. My dream is to buy an NFL team. But stimulating growth is impossible if the economy isnt open. Legal Statement. Mr. McDonald previously was CEO/CIO of Index Strategy Advisors Inc. (ISA) from 2010-2019. McDonald also allegedly raised over $3.5 million for securities trades through . "Robust, quant driven investment strategies are typically only available to Ultra High Net Worth individuals and families with $25 million or more to invest. 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,. Very few recessions and market collapses have recovered in the time period that we saw in 2020. Your email address will not be published. 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. 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. I played semi-pro football for 12 years. Address of QUALITY servIce and relIable guarding, We are constantly workIng and developng to mprove our qualIty of servce. Unlike hedge funds, however, a mutual fund is accessible to individual investors and their advisors in a very transparent package. 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. You've successfully subscribed to this newsletter! 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. Our ability to monetize volatility is exceptional as evidenced by our winning WealthManagement.coms 2020 Wealthies Award as top Alternative Asset Manager. 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.. 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. The potential for growth is there, but the conditions for growth are not because we are artificially providing income. Our employees and their family members enjoyed a wonderful time together this morning at PureTrack in Anaheim, CA! Now he's wanted on fraud charges. 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 . PDF Case Plaintiff Defendant - United States Courts Early life James McDonald was born in Wellhead, Morayshire, in north Scotland on September 23 1840. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. NE Atlanta, GA 30326 *by appointment only. Its an all-weather strategy. 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. Your email address will not be published. The Fund seeks to implement very short-term long and short positions in call and put options on the main US stock . McDonald allegedly raised over $5 million and misappropriated funds for personal expenses and Ponzi-like payments. The complaint seeks permanent injunctions, disgorgement with prejudgment interest, and civil penalties against McDonald and Hercules. "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. Do you still have a 15,000 target on the Dow? Powered and implemented by FactSet Digital Solutions. The Hercules investment team features investment professionals averaging over 20+ years of experience . Get all the stories you need-to-know from the most powerful name in news delivered first thing every morning to your inbox. 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? Contact me online or call anytime at 844-689-5754. 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 . - 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. His demeanor was professional and pleasant and I would not hesitate to use him in future matters. The attorneys at ChapmanAlbin are licensed to practice law in Ohio and Michigan. 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. It wasn't immediately clear whether he had an attorney who could speak on his behalf. Mutual Fund and ETF data provided by Refinitiv Lipper. In fairness to James McDonald, television is a much more welcoming venue than an SEC hearing room or courthouse. Fair question. This case was filed in Los Angeles County Superior Courts, Norwalk Courthouse located in Los Angeles, California. 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. And so, we had that crash and then the desire and the interest in moving back forward. 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. A CNBC spokesperson told USA TODAY the network no longer allowed McDonald on the air as soon it found out he was under investigation. Hercules applies quantitative research to design and actively manage portfolios for investors seeking maximum growth during up or down-market cycles. So, I got to root for Tom Brady because any 40-plus football player is one I admire. A Division of NBCUniversal. Additionally, McDonald raised $1.5 million through equity investment sales in Hercules business while lying, failing to disclose important facts, and more. 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. According to the. Whats the bear case predicated on? And debt has spiraled over 50% higher to GDP than where we were last year this time. Market data provided by Factset. The actual profits that have been generated and the guidance that has increased are based on a small section of the market. My dream was always to play in the NFL and thats going to be my ticket. He appeared as a financial expert on TV. Hercules Investments specializes in actively managed and systematic investment strategies to monetize investment performance from equity market volatility. Hercules Investments has named Loreal McDonald as corporate counsel and interim chief operating officer. 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. All rights reserved. I think we will have another risk event that pulls the market down. Our strategies offer downside protection and even potential upside gains with protracted market downturns. 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. Quant Research-Driven Investment Strategies For Investors Seeking Active Portfolio Management. On 11/16/2021 HERCULES INVESTMENTS, LLC filed a Contract - Business lawsuit against DANNY MICHAEL CORRAL. Please note: We are unable to take cases with losses of less than $50,000. 2023 RIA Intel, an Institutional Investor Publication. Top Hercules Investments Employees James McDonald Chief Executive Officer. This site contains attorney advertising. Our objective is to generate $10 billion for our clients in order for me to buy my football team. Hercules Investments was awarded the WealthManagement.com 2020 Alternative Asset Manager of the year. 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. // Disclaimer. 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. 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. And even still, there is the risk of mutations, the continuation of sickness, hospitalizations, and fear will cause stagnation for the reopening concept. 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. 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. The breadth of risk is extremely wide. Scott Gamm So, I think over 75% of the gains in the S&P 500 in 2020 could be attributed to a handful of names. In reality, McDonald used less than half of those funds for trading and did not engage in any trading with the funds for long stretches of time. Actually, he didnt just assume it: He bet his clients money rather heavily on it, and lost them upwards of $40 million doing so. Lets call it artificial income and artificial credit for small businesses that are keeping the economy alive. CHICAGO JUDGE DENIES BAIL FOR ILLINOIS WOMAN WHO ALLEGEDLY PUSHED 3-YEAR-OLD NEPHEW INTO LAKE MICHIGAN. [Like this article? But I think that the market will rebound and potentially finish the year slightly higher. 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. 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. Hercules Investments chief investment officer James McDonald used to be a familiar face on CNBC, pontificating about market matters as an expert thereon. ) from 2010-2019 know about your firm and how you can help them interim operating! To fraudulent securities offerings practice law in Ohio and Michigan misappropriated funds for personal expenses Ponzi-like. If convicted, is believed to be a familiar face on CNBC, pontificating market! Such mimics many of the year face on CNBC, pontificating about market matters as an expert thereon of market! 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