The SpaceX IPO will make you wealthy on paper. Keep it that way.

Cache Long/Short is a tax-aware investment strategy designed to help you diversify out of concentrated stock positions gradually while seeking to manage the tax consequences.

The strategy builds a portfolio of long and short positions around your existing holdings, configured toward your long-term goals. Long positions that decline and short positions that rise both create potential losses the portfolio manager can harvest deliberately. Those realized losses may then be used to offset taxable gains elsewhere, subject to applicable tax rules. Throughout, your net market exposure is targeted at 100%.

We built this in partnership with Brooklyn Investment Group (BKLN), an SEC-registered advisor with deep experience in institutional tax-aware investing. BKLN manages portfolio construction, trading, and tax-aware execution. Cache brings the strategy to you through a modern, online platform.

The minimum investment is $1M. And your assets are held in a separately managed account at Charles Schwab, in your name.

Cache Long/Short is built for investors who have significant unrealized or ongoing capital gains, a high marginal tax rate that makes tax efficiency materially valuable, a multi-year investment horizon, and comfort with margin, leverage, and portfolio complexity.

It may not be appropriate if you don't have meaningful taxable gains to offset, are uncomfortable with margin borrowing, want a one-time tax solution rather than an ongoing strategy, or prefer simple, long-only portfolios.

This strategy involves leverage, financing costs, and operational complexity. For the right scenario, those tradeoffs make sense. For others, simpler tools (like direct indexing or a straightforward sale) may be a better fit.

Here's when investors typically consider this strategy, and what to weigh in each case.

1. Diversifying concentrated stock, tax-efficiently

You hold a large, appreciated position and want to reduce concentration risk without a large, immediate tax bill. The right approach depends on your cost basis. For very low basis shares, an exchange fund offers immediate diversification with a simpler structure (though it requires a seven-year holding period). Cache Long/Short may be better suited for medium-basis shares or as a complement to an exchange fund, letting you gradually sell over time while seeking to harvest losses to offset those gains.

Many investors use both: an exchange fund for the portion they can commit long-term, and Long/Short for the rest.

2. Offsetting gains you've already realized

You've sold stock or have gains from fund distributions, rebalancing, or other activity, and you want to offset that liability within the current tax year. If you act within the same year, the strategy can generate losses that may offset those gains. Excess losses can be carried forward. The amount generated depends on market conditions, leverage level, and portfolio activity. Results vary, and specific outcomes cannot be guaranteed.

3. Preparing for an upcoming taxable event

You have a known event on the horizon, such as an IPO lockup expiring, a secondary sale, a business exit, or a real estate sale, and want to build up losses in advance. The earlier you start, the more losses you may accumulate before the event. If it doesn't occur or is delayed, unused losses carry forward.

4. Managing ongoing tax drag over time

You don't have a single large event, but you have recurring gains from RSU vesting, fund distributions, or other investment activity. Traditional tax-loss harvesting can run dry as portfolios fill with appreciated positions. Cache Long/Short seeks to continue generating harvestable losses across different market environments, including rising markets.

This approach tends to work best with a multi-year horizon. This could be 3-5 years for a 145/45 strategy, or 15+ years for estate planning or wealth transfer scenarios, where assets may receive a step-up in basis under current tax laws.

Results depend on market conditions and individual circumstances. Consult a tax professional to understand how this fits your situation. Cache does not provide tax or legal advice.

More control over your taxes. The strategy seeks to generate a renewable supply of capital losses you may apply against taxable gains, while keeping your portfolio fully invested.

The key advantage over traditional tax-loss harvesting: in a long-only portfolio, harvestable losses tend to dry up as markets rise and positions appreciate. By adding short positions, the portfolio is designed to seek to produce harvestable losses across a wider range of conditions, including bull markets, because short positions can lose value even when stocks go up.

The strategy doesn't eliminate taxes. It seeks to defer them, giving you more control over when and how much you pay.

You open a managed account at Schwab. Inside it, Brooklyn Investment Group (BKLN) builds a diversified portfolio of long and short positions around your existing holdings.

The portfolio holds more long exposure than short, keeping your net market exposure close to 100%. The structure creates two sources of harvestable losses: long positions that decline in value, and short positions that rise in value. As markets move, BKLN seeks to realize those losses deliberately and consistently.

The realized losses show up on your tax forms and may be applied against gains from selling stock, fund distributions, or other taxable events. Realization and usability depend on market movements, trading activity, and applicable tax rules.

Exchange funds, also known as swap funds, are private investment funds that allow investors to diversify their stock positions tax efficiently by exchanging stocks for shares in a broader portfolio. These funds accept stocks from a variety of companies, and each investor receives a share of the pooled fund that is equal to the value of the stock they contributed.

There are two primary benefits:

1. To help investors meet their diversification objectives, each fund is built around a benchmark index, such as the Nasdaq-100 or S&P 500. By doing so, they reduce volatility and investment risk in concentrated portfolios. Keep in mind that these funds are designed to diversify – not to outperform the contributed stock positions. And all exchange funds carry some risk, including the risk of losing principal in the fund.

2. As a tool for long-term financial planning, exchange funds also allow participants to defer capital gains taxes when they diversify. By doing so, investors can diversify without experiencing tax drag, and they are left with more principal to compound over time. To better understand the potential tax benefits, see our exchange fund calculator.

Though investors are diversified upon contribution, they must remain in the fund for seven years before they can withdraw a tax-deferred basket of stocks. Exchange funds are structured as limited partnerships, and the fund is also required by tax rules to hold 20% of its assets in qualifying illiquid assets, such as real estate or commodities.

Here are more detailed resources we've written to help you understand how exchange funds work:

• Start with Exchange Funds 101

• Dive deeper with our Exchange Funds Guide

• Learn all the details about the Cache Exchange Fund

As you consider your long-term financial plan, here are some data points to keep in mind about concentrated stock portfolios:

• Long-term stock market wealth creation is concentrated in a tiny handful of firms, and that concentration is intensifying. Of 29,081 US firms publicly listed between 1926 and 2025, just 46 firms account for half of the $91 trillion in net wealth created. The median stock actually lost 6.9%, and nearly 60% of firms destroyed shareholder wealth relative to Treasury bills. (Source: Bessembinder, "One Hundred Years in the U.S. Stock Markets," 2026)

• The probability of any stock outperforming the market is low. For example, between 2001 and 2023, 73% of the stocks in the Nasdaq-100 index underperformed the index -- and 44% of those stocks actually lost money. (Source: Internal research, based on Bloomberg data.)

• Over a longer timespan, index funds have produced higher risk-adjusted returns than all but a handful of stocks. The average equity investor underperformed the S&P 500 by 4.32% over the 20-year period from 1992–2011. (Source: 2016 Dalbar QAIB Report)
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• A 2022 study of almost 100 years of US stock market data found that stocks that were among the top 20% of performers for any five-year period went on to lag the market 86% of the time over the next ten years. (Source: Brooklyn Investment Group)

With Cache as your exchange fund provider, you’ll exchange your stocks for a diversified fund without triggering taxes. This tax deferral ensures that 100% of your pre-tax dollars stays invested in the market, compounding over time. Assuming historical stock returns, this could add to a sizable advantage over time.

Like any investment, participation in exchange funds can also carry risk, including the loss of principal and limited liquidity during the fund's life.

Please see our disclosures before making any investment decisions.

The Cache Exchange Fund has a streamlined enrollment process that’s intended to make participation easier and more accessible for investors with a concentrated position. It takes about a month from the time an investor is invited to the fund to when they officially join.

If you are an investment advisor:

Your timing will be similar, but please request allocations for your clients via our Advisor Portal. Check availability or log in here.

Here’s a typical timeline:

1. Indicate Your Interest:

   Joining an exchange fund starts with sharing some information about yourself and the stocks you may want to contribute to the fund. It just takes a moment to share some basic information.

2. Matching and Allocations:

   The goal of The Cache Exchange Fund is to bring together shareholders to build a diversified portfolio that’s benchmarked to an index like the Nasdaq-100 or S&P 500. To meet this goal, our Investment Team carefully balances the amount of different stocks we match to the fund. For some of our funds, available to Qualified Purchasers, we are able to take on investors with stock that we may not otherwise be able to by using ETF Rebalancing. When you indicate your interest, we look to see whether your stocks are a match. Matching can happen instantaneously, or it can take several weeks or months if we have too much of a given stock.

3. Accept Your Invitation: When you match and receive an allocation to the fund, we’ll send you an invitation to join. Accept the invitation by opening a brokerage account with Cache, verifying your eligibility and accredited investor status, and then transferring your stocks to Cache. This process takes a few minutes for you to complete, but it can take two weeks or more for stocks to be transferred by your institution.

4. Sign Subscription Docs:

   Once your account is set up and ready to go, you’ll review and sign subscription documents that lay out all the terms and conditions around participating in the fund.

5. Final Inspection:

   Several days before the fund closes, you will have an opportunity to review the composition of assets in the fund and details about the real estate investment. These final details aren’t available until you and other participants have contributed their stocks and signed the subscription agreement.

6. Closing:

   Assets for the fund are held in an escrow-like state until the fund closing. The net asset value and each participant’s pro-rata share are calculated based on the value of the shares upon market close that day.

7. Receive Your Fund Shares:

   The day after the fund closes, your shares will be granted and you will officially be a participant in the fund.

This entire process takes place in the Cache platform, and it’s easy to complete.

If you have more questions about exchange funds, you may also want to check out Exchange Funds 101, or our deep dive on the mechanics of exchange funds.

Please see our disclosures before making any investment decisions.

The Cache Exchange Fund is an investment vehicle that allows investors to diversify their portfolio while deferring capital gains taxes that would otherwise arise from selling appreciated stock positions. Most exchange funds are specifically designed to allow investors to pool their individual stocks into a diversified fund, thus mitigating the risks associated with holding a concentrated stock position.

Diversification and Benchmarking

Cache currently offers exchange funds benchmarked to the Nasdaq-100, S&P 500, and S&P 500 Growth indices, providing similar return and risk characteristics as the underlying index. However, exchange funds do not attempt to replicate the index stock for stock, as they are formed through contributions from shareholders and not from a market purchase of stocks.

Breakdown of Cache Funds

Nasdaq-100 Exchange Fund

• Focus: Growth-oriented portfolio with heavy exposure to the technology sector.

• Objective: Engineered for precise tracking to the Nasdaq-100 index.

• Key Features: Ideal for investors seeking concentrated growth potential in technology and other innovation-led industries.

S&P 500 Exchange Fund

• Focus: Broad market exposure across 500 large-cap U.S. companies.

• Objective: Provides a diversified sector mix to cover the overall market performance.

• Key Features: Suitable for investors looking for balanced exposure to multiple sectors without heavy concentration.

S&P 500 Growth Exchange Fund

• Focus: Growth subset of the S&P 500, with a tilt toward technology and consumer discretionary sectors.

• Objective: Mirrors the performance of growth-focused companies within the S&P 500 index.

• Key Features: Designed for investors targeting growth opportunities while still benefiting from S&P 500 exposure.

Fund Management

Our funds are primarily passively managed, meaning fund managers do not frequently buy and sell assets. However, we may implement some active management decisions in response to dividends and other corporate actions, in order to align the fund more closely with its investment objectives. These activities are carried out with the aim of maintaining or achieving desired exposure to market sectors or responding to market conditions.

Qualifying Assets

Investor contributions form the fund's primary assets. However, tax regulations also require at least 20% of an exchange fund to be dedicated to illiquid “qualifying assets.” We achieve this purpose by investing in real estate funds. The real estate portion is managed through partnerships with experienced external managers and funded through credit facilities, which are part of the fund's strategic financial management.

Enrollment Windows (and Rebalancing)

Our funds are structured to offer periodic enrollment windows that allow new investors to join. This approach provides flexibility and helps our managers ensure that our funds meet their diversified investment objectives. Our open window approach could be used to rebalance the fund when it becomes unbalanced because some assets outperform others. In addition, Cache employs a fund-matching process to determine eligibility for participation. Each investor's contributed shares are evaluated for their compatibility with the fund's structure and criteria. For example, investors aiming to contribute shares to the Nasdaq-100 fund must meet certain accreditation standards and align their contributions with the fund’s sector focus.

In managing our funds, we strictly adhere to all regulatory standards and our own commitment to transparency, acting as a steward of investor capital under strict compliance and oversight. Nonetheless, exchange funds are for long-term investors, and like all investments they may carry risks, including the loss of principal.

Tips for Selecting the Right Exchange Fund

1. Assess Your Investment Goals: Determine whether you’re seeking broad market exposure, growth-focused investments, or concentrated sector performance.

2. Evaluate Your Current Portfolio: Look for a fund that complements your existing investments and enhances diversification.

3. Understand Sector Exposures: Consider how exposure to technology, consumer discretionary, or other sectors aligns with your financial strategy.

4. Review Eligibility: Ensure your contributed shares match the requirements of the fund during the matching process.

For additional information, see:

• A broad exchange fund overview

• Meet the Cache investments team

• Guide to participating in The Cache Fund

Please see our disclosures before making any investment decisions.

Cache has grown rapidly since launch and, as of June 2026, manages over $1.6B in platform assets. The business is operating sustainably and is well-positioned to continue serving clients for the long term. That said, Cache was intentionally structured with multiple safeguards designed to protect investors even in the unlikely event that the company encounters financial difficulty.

Regulatory structure and protections

Cache Securities LLC is an SEC-registered broker-dealer and a member of FINRA. Cache Advisors LLC is an SEC-registered investment adviser that serves as advisor to our exchange funds. Both are wholly owned subsidiaries of Cache Financials Inc. Brokerage assets receive SIPC coverage of up to $500,000 for securities and $250,000 for cash, and there are well-defined regulatory procedures that govern any potential dissolution.

Asset custody, segregation and audit

None of the Cache entities hold client assets. Each exchange fund is custodied at a global bank, BNY Mellon, the largest custodian bank globally. Brokerage assets are custodied at Apex, a leading provider of brokerage infrastructure to hundreds of fintech firms.

Each fund is administered by a leading independent third-party fund administrator. This independent structure ensures oversight on fund accounting.

Each fund goes through a full financial audit with an independent auditor (BDO - a Top 5 Global Audit Firm).

Owned by Investors

Each exchange fund is a separate legal entity owned by its investors. Cache maintains little to no ownership in the funds themselves, and the funds do not fall into our corporate structure.

If Cache were no longer viable

Our structure allows for a clear and orderly transition that prioritizes investor continuity:

1. Cache Advisors LLC could continue operating as a lean entity, with advisory fees from the funds sufficient to support ongoing obligations.

2. Investors have the right to appoint a replacement investment adviser. Because each fund generates its own revenue, a qualified advisor can step in without disrupting fund operations.

3. The independent fund administrator would oversee the transition and ensure normal fund operations continue throughout the process.

Our governing documents are designed with investor protection in mind and explicitly address these transition scenarios, providing safeguards that go beyond typical market standards.
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Learn a little more about our approach to protecting our clients' investments.

Please see our disclosures before making any investment decisions.

Our funds have a structured fee schedule based on an investor’s commitment into the fund. Here’s a breakdown of the typical fees associated with Cache funds:

Management Fees

Our management fee ranges from 0.40% to 0.95% on an annual basis, calculated on the fund's gross assets under management and charged monthly as 1/12 of the annual rate.

This fee structure is designed to be competitive and is significantly lower than many traditional exchange funds, reflecting Cache’s commitment to providing cost-efficient investment solutions. Depending on your participation amounts, the fees decrease according to the following scale:

• $100,000 - $249,999: 0.95%.

• $250,000 - $499,999: 0.85%.

• $500,000 - $999,999: 0.70%.

• $1,000,000 - $4,999,999: 0.60%.

• $5,000,000 - $24,999,999: 0.50%.

• $25,000,000 and above: 0.40%

These rates are determined based on cumulative contributions to the funds.

After you complete seven years in the fund, the annual management fee drops to 0.25%.

We offer stock-specific discounts, referral discounts, and other discounts from time to time. Check eligibility by enrolling on our website. Detailed fee schedules and adjustment tiers are also in the FAQ section of the Cache client portal.

We also offer wholesale pricing through financial advisors. Ask your advisor about it.

Sales or Subscription Fees

We do not charge any sales fees, subscription fees, or commissions.

Performance Fees

There are no performance fees associated with our funds.

Redemption fees

No redemption fees are charged to investors who have participated in the fund for at least seven years. However, there are fees associated with early redemption.

ETF Expenses

Our Flagship fund series uses ETFs as part of the portfolio construction to help maintain benchmark alignment and diversification.

These ETFs have their own internal expense ratios (typically around 0.15%), which are charged by the ETF provider.

To help offset these costs, Cache provides a 0.15% management fee offset for ETF expenses in our Flagship fund series. This means the fund’s management fee is reduced by the amount of ETF expenses incurred by the fund, helping ensure investors are not effectively paying overlapping management costs.

Other Expenses

These include tax and audit expenses, setup expenses, real estate expenses, and other operational expenses necessary to maintain the fund. We expect the other expenses to be in the 0.10% - 0.15% range. These costs are shared among all investors and factored into the fund's net asset value.
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Keeping fees low and transparent aligns with our overall objective of offering a cost-effective way to diversify.

Please see our disclosures before making any investment decisions.