O’Shares Direct Indexing with a Personalized Touch:
The Future of Wealth Management
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O’Shares Direct Indexing with a Personalized Touch:
The Future of Wealth Management
Learn more

How Advisors Can Stand Out in a Commoditized World

In a world where almost everyone has access to the same investment tools, standing out can be difficult. However, with Direct and Personalized Indexing, you gain opportunities to differentiate your investing approach, and to make your practice more efficient, while also providing your clients with more value through portfolio personalization and potential tax benefits.
What is Direct Indexing? Direct Indexing uses technology to facilitate directly owning stocks of an index for clients, as a compliment to (or replacement for) ETFs and mutual funds, while also using technology to efficiently drive tax optimization across client portfolios. Powered by technological advancements and reduced trading costs, Direct Indexing paves the way for an investing strategy that delivers added personalization and tax efficiency.
What is Personalized Indexing? Personalized Indexing goes beyond Direct Indexing, creating an index that is designed specifically to your distinct needs, preferences, and values. From optimizing taxes to managing risk, and transitioning existing holdings, Personalized Indexing offers portfolios as unique as you.

Tax Alpha: Tax Loss Harvesting with Efficiency and Scale

Our approach leverages cutting-edge tax-loss harvesting technology to enable you to save valuable time while capturing potential annual after-tax alpha for clients. With our approach, you will benefit from:
  • Daily automated scanning to identify tax-loss harvesting opportunities.
  • Automated rebalancing to optimize your portfolio’s performance.
  • Real-time tax transition analyses including cap gain budgets for informed decision-making.

The Benefits: Elevating Advisors and Empowering Investors

Direct and Personalized indexing, using the latest technology and low-cost trading, makes these benefits more accessible than ever.

For Financial Advisors

Boost client satisfaction and retention with superior strategies.
Attract high-net-worth clients with personalized investment solutions.
Expand your client base without sacrificing service quality.
Draw top talent with advanced capabilities in personalization and tax optimization.
Stand out with unique, tailored offerings.

For Investors

Maximize opportunities for tax-loss harvesting, manage capital gains and transition to other strategies tax effectively.
Align your investments with your values and financial goals.
Gain clear insights into your investments.
Exercise greater control over your investment decisions.
Foster disciplined investment approaches that prioritize tax-loss harvesting opportunities during volatile markets.

We are committed to helping you provide your clients with the best possible investment outcomes and save on taxes.

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A Brief History: From SMAs to Personalized Indexing

Emergence of Separately Managed Accounts (SMAs)
1990s
Advent of Direct Indexing
2010s
Launch of Commission-Free Trading and Fractional Shares
2023
1970s
Rise of Exchange-Traded Funds (ETFs)
Early 2000s
Arrival of Robo-Advisors
2019-2020
Age of Personalized Indexing
1970s
Emergence of Separately Managed Accounts (SMAs)
1970s
1990s
Rise of Exchange-Traded Funds (ETFs)
1990s
Early 2000s
Advent of Direct Indexing
Early 2000s
2010s
Arrival of Robo-Advisors
2010s
2019-2020
Launch of Commission-Free Trading and Fractional Shares
2019-2020
2023
Age of Personalized Indexing
2023

Projected to Grow More Than 12% Through 2026

With the growing demand for tax-aware strategies for non-qualified accounts, Direct Indexing has emerged as a powerful differentiator for Financial Advisors. Inflows into direct index investing products are projected to grow at “an annualized rate of more than 12% over the next five years, faster than traditional financial products.”

Projected 5-Year Growth Rates by Product

Source: Cerulli Associates. “Direct Indexing Growth Projected to Outpace ETFs, Mutual Funds, and Separate Accounts Over Next Five Years.” August 16, 2021.

Direct Indexing, unlike pooled investments such as Mutual Funds and ETFs, provide the ability to cater to each individuals’ specific investment goals and actively manage tax loss harvesting opportunities daily.

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Unlocking Tax Alpha: Direct Indexing Offers Solutions

Tax-optimized strategies in ETFs face regulatory and structural barriers, such as the inability to pass on capital losses to investors. Direct indexing emerges as a solution for investors to navigate these challenges and gain tax advantages.
Mutual Funds
ETFs
Direct Indexing
Distribution of Gains
Yes
Yes, Less Common
Strategically Controlled
Ability to Pass Capital Losses to Investors
No
No
Yes
Control Over Tax Timing
None
None
Full Control
Tax Impact of Redemptions
High
Limited
None
Annual Tax Alpha
0%
0%
1-2% *
Source: Morningstar Report, “The Direct Index Landscape-March 2023”

Learn how Direct Indexing can benefit you.

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Experience the power of personalized investing at O'Shares Investments, where direct and personalized indexing solutions are revolutionizing portfolio management.

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IMPORTANT Please be aware that all investing carries inherent risks, and there is a possibility of losing your principal investment. Market fluctuations and various factors can lead to declines in the value of your account. It’s important to understand that there is no guarantee that any specific asset allocation or combination of direct indexes or funds will align perfectly with your investment goals or provide a specific level of income. Diversification, while valuable, does not guarantee profits or safeguard against losses. The information provided here does not constitute tax advice and cannot be utilized to avoid potential tax penalties as per the Internal Revenue Code. It is essential for each individual to consult an independent tax advisor to understand their unique situation before making any investment decisions. Tax-loss harvesting, while potentially beneficial, involves specific risks, including the chance of the new investment incurring higher costs than the original investment and introducing portfolio tracking errors in your accounts. Additionally, there may be unintended tax implications. Therefore, prospective investors should seek guidance from their tax or legal advisor before engaging in any tax-loss harvesting strategy. Please note that O’Shares Investments and its affiliates do not provide tax or legal advice. O’Shares partners with technology providers in connection with Direct Indexing.
The information provided here is solely for informational purposes and should not be considered as investment advice. It does not constitute a recommendation to buy or sell any specific security, strategy, or investment product. Please be aware that investing in securities comes with inherent risks, including the potential loss of capital, and past performance does not guarantee future results. The historical returns, expected returns, and probability projections mentioned are provided for illustrative and informational purposes only and may not accurately reflect actual future performance. The product images displayed are also for informational and illustrative purposes and may not represent the actual appearance of the products. It’s essential to understand that nothing on this website should be construed as personalized investment advice, as such advice can only be offered through individual one-on-one communications. For tailored investment advice, please seek direct and personalized communication with a qualified financial advisor.
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The material available on non-affiliated websites has been produced by entities that are not affiliated with O’Shares Investments. Descriptions of references to, or links to products or publications within any non-affiliated linked websites does not imply endorsement of that product or publication by O’Shares Investments. Any opinions or recommendations from non-affiliated websites are solely those of the independent providers and are not the opinions or recommendations of O’Shares Investments, which is not responsible for any inaccuracies or errors.
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The material available on non-affiliated websites has been produced by entities that are not affiliated with O’Shares Investments. Descriptions of references to, or links to products or publications within any non-affiliated linked websites does not imply endorsement of that product or publication by O’Shares Investments. Any opinions or recommendations from non-affiliated websites are solely those of the independent providers and are not the opinions or recommendations of O’Shares Investments, which is not responsible for any inaccuracies or errors.
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