Read the PDF Fact Sheet

Our Philosophy: Direct Indexing

Direct Indexing is an investment strategy in which long-only equity portfolios aim to track a specific index with a user-selectable number of holdings. They are constructed using automated quantitative methods designed to provide a risk-factor exposure that is similar to that of the index while opportunistically adding value via tax management. 

Smartleaf Asset Management offers Direct Indexing portfolios called Smartleaf Core Portfolios (SCPs).

Read the full fact sheet for our Core Portfolios here 

Direct Indexing has several benefits over ETFs and index mutual funds due to holding individual equities:

Tax Management

Even when the market goes up, some securities decline in value. Holding individual securities allows investors to harvest losses and defer realizing gains at the lot level.

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Direct indexing allows for security-level customization. Investors can exclude individual securities as well as put their own imprint on a portfolio by deciding which SRI issues are most important to them.

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Portfolios with existing low-basis securities can be transitioned into a direct indexing portfolio, helping investors to manage the tax effects of transitions and potentially realize significant tax savings.

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