Concept · Funds, wrappers and fees
What is direct indexing?
Direct answer Owning the individual stocks of an index in a separately managed account instead of owning a fund that holds them. Each position is a place a loss can be harvested, and the portfolio can exclude or tilt specific stocks. The cost is a management fee (9 basis points at retail, about 115 all-in through an adviser), hundreds of positions, and wash-sale exposure across the household.
It fits new money whose harvested losses have somewhere to go: recurring short-term gains, steady contributions, or a charitable exit. Moving an existing low-basis portfolio in means selling it, which is the one thing to avoid. Read direct indexing, in one page.
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