Sitting on a heavily concentrated position? The tax bill from selling can feel like a punishment for success. But there's a playbook here—multiple strategies, actually.

You could use derivatives to hedge downside while maintaining exposure. Options collars, exchange funds, charitable trusts—each has its place depending on your timeline and risk appetite. Some prefer gradual liquidation spread across tax years. Others lean into donor-advised funds to offset gains with deductions.

The real question isn't whether to diversify. It's finding the path that doesn't hand over a third of your gains to the taxman. Plenty of tools exist. The trick is matching the right one to your situation.

No single answer works for everyone, but ignoring the problem? That's how concentrated bets turn into concentrated regrets.