Two people asked me yesterday about borrowing against their portfolios to buy real estate.

The answer was different for each:

• One is well-capitalized. Borrowing against their portfolio to buy a house can make a lot of sense.

• The other has a very different balance sheet and risk profile. For them, it's probably not the right move.

What SyntheticFi is making available to everyday investors is incredible.

Cheaper, more transparent ways to borrow against portfolios and concentrated stock used to be reserved for institutions and ultra‑HNW.

But you want to make sure you are being responsible with how you use them.

For the $10M+ portfolios I’m working on, I view every financing decision through three lenses:

• Risk
• Return
• Taxes

Used well, these tools can help you:

• Finance real estate purchases
• Rebalance portfolios without triggering massive gains
• Use structures like synthetic variable prepaid forwards to borrow against concentrated stock more intelligently

Used carelessly, leverage can magnify losses and turn a temporary market decline into a permanent impairment of capital.

I think one of the most valuable roles of an advisor is to stand between clients and an ever-expanding toolkit.

Not to say yes or no to every strategy.

But to know which tools to use, when to use them, and just as importantly, when not to.