> For the complete documentation index, see [llms.txt](https://advisorhub.syntheticfi.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://advisorhub.syntheticfi.com/disclosures.md). # Disclosures ### General SyntheticFi is an SEC-registered investment adviser. Registration does not imply a certain level of skill or training. This hub is educational and informational only. It is not investment, tax, or legal advice, and it is not an offer or solicitation. Nothing here is a recommendation to any specific client. Suitability depends on the client's individual circumstances, and advisors are responsible for determining whether the strategy is appropriate for a given client. ### Rates and comparisons Any rate, savings, or cost comparison in this hub is illustrative and not a quote or a guarantee. Rates are set by the market, vary by term, loan size, portfolio composition, and market conditions, and change continuously. Comparisons to SBLOCs, margin loans, mortgages, or bank lines depend on the specific product, lender, borrower, and terms being compared, and will not hold in every case. Rates shown do not include management fees. Actual costs vary by firm. See Current Rates for live pricing, and run a client-specific comparison in the Proposal Center. ### Tax treatment SyntheticFi does not provide tax advice. Tax outcomes depend entirely on the client's individual circumstances, and tax law is subject to change. Financing costs on the strategy are generally reported by custodians as Section 1256 gains and losses and are treated as capital gains and losses (60% long-term, 40% short-term). Capital losses are subject to limitations on how and when they can be used, including netting rules, annual limits on offsetting ordinary income, and carryforward rules. A capital loss does not guarantee a current-year tax benefit. Some practitioners take the position that the financing cost may qualify for the Investment Interest Expense Deduction. That is an advanced position, is not settled, and depends on the use of the loan proceeds and the client's facts. SyntheticFi has requested a private letter ruling from the IRS and has not received a response. Clients should consult their own tax professional before relying on any tax treatment described in this hub. ### Risks Borrowing against a portfolio involves risk of loss. **Margin call risk.** If the value of the collateral portfolio declines, the client may be required to deposit additional cash or securities, or securities may be sold, potentially at an inopportune time and with tax consequences. Some custodians may liquidate positions without prior notice. The size of the cushion before a call depends on how much is borrowed, the portfolio's composition, and the custodian's maintenance requirements. **Interest rate risk.** A fixed-rate loan does not adjust if market rates fall. Exiting a fixed-rate position before expiration may result in a cost that depends on prevailing rates at that time. **Execution risk.** In stressed or illiquid markets, the ability to open, roll, or exit positions may be impaired or delayed. In that event a client may incur standard margin interest or other costs. **Investment risk.** Portfolio returns are uncertain and may be lower than the cost of borrowing. Using borrowed funds can magnify losses. Interim mark-to-market values fluctuate, and accounts may display negative values or per-position gains and losses that do not reflect the economics of the loan. ### Operational Onboarding times, paperwork requirements, funding timelines, borrowing limits, margin requirements, and margin call procedures vary by custodian and by account, and are subject to change. Any timeline described in this hub is typical, not guaranteed, and depends on custodian processing, approvals, and market conditions. ### Third-party content Links and references to third-party materials are provided for information only. SyntheticFi is not responsible for their content and does not endorse them. ### AI-Assisted Search This hub includes an AI-powered search and question-answering feature provided through GitBook. It generates responses based on the content of this hub. AI-generated responses may be incomplete, inaccurate, or out of date, and can occasionally produce information that is not correct ("hallucinations"). These responses are not a substitute for the underlying pages, your own judgment, or advice from SyntheticFi. Always verify AI-generated answers against the source pages in this hub, and confirm anything material with your SyntheticFi contact before relying on it or sharing it with a client. AI responses do not constitute investment, tax, or legal advice. ### Questions Contact . --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. 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