tax-advantaged long/short SMA strategies - FLEX Overlay Extensions
Glover Park Wealth Management, LLC is a SEC registered investment adviser (RIA) that provides high-net-worth clients with access to several
Tax-Aware SMA's through our third-party custodian, Charles Schwab & Co., Inc.
Tax-aware strategies are a version of direct indexing using long/short leverage via portfolio flex extensions using leverage. The strategy invests in individual stocks that attempt to track an index (with tracking error) such as the S&P 500, Russell 1000, 3000, MSCI World, and tax-loss harvests throughout the year.
By utilizing a Separately Managed Account (SMA) the portfolio manager adds Flex overlay portfolio Extensions. This takes tax-aware investing further by going long/short using margin leverage or portfolio margin. This type of portfolio margin helps tax-loss harvest throughout the year which creates realized losses while tracking an index.
The portfolio manager or quantitative strategy goes long the stocks which the quantitative model believes have a favorable risk/reward and selling short the companies they believe will underperform.
The "tax-aware" part: The SMA that uses extensions with flex extensions / overlay strategy harvests losses on both the long and short sides of the portfolio, often generating short-term capital losses you can use to offset gains elsewhere in your portfolio, or to offset capital gains from the sale of an outside asset such as a closely held business or real estate.
How does tax-aware investing strategies accomplish this? They achieve the tax alpha from tax loss harvesting positions and deferring gains for long-term capital treatment on the other side of the portfolio.
Over time, this can create a significant amount of tax alpha, where you're compounding wealth faster with after-tax dollars. Tax-advantaged long/short strategies are investment strategies used in separately managed accounts (SMAs) to enhance after-tax returns by systematically generating more short-term capital losses through both long and short positions while attempting to tracking an index (with tracking error) such as the Rusell 1000, Russell 3000, or S&P 500.
The goal of the tax-aware SMA strategy is to help you build or diversify after-tax wealth without the usual tax drag, especially if you have highly concentrated positions in stocks, ETF's, mutual funds, and/or facing a large capital gains tax bill from the sale of your business or concentrated stock position.
Asset Managers who provide tax-aware SMA strategies: AQR, Quantinno, Parametric, Brooklyn Investment Group (BKLN).
Charles Schwab & Co., Inc. is the third-party custodian of client assets for Glover Park Wealth Management, LLC.
Schedule a meeting with Glover Park Wealth Management, LLC today to learn more about these
advanced SMA tax-loss harvesting Flex / Extension strategies to
diversify and grow capital in a tax aware and efficient manner.
Tax Aware Investing
Why use Glover Park Wealth as your RIA for Tax-Aware Investing?
Tax Aware Investing is designed for high-net-worth individuals and ultra-high net worth individuals.
In a long/short tax aware portfolio, the portfolio manager or quantitative investment strategy goes long a basket of stocks in which they believe have upside and shorts a basket of stocks that they believe are weak or have downside momentum.
- The Tax Deferral Strategy: Instead of realizing gains right away from the sale of a highly appreciated asset, the tax-aware SMA strategy holds winners longer to achieve long term unrealized gains and realizing short-term capital losses via tax-loss harvesting. This isn't just loss harvesting; it's delaying the immediate capital gain, which compounds the capital which would have been paid in taxes and therefore creating "tax-alpha". This is how Tax-Aware investing helps high-net worth individuals compound after-tax wealth while diversifying their portfolio across a broad index of stocks.
Contact us for an initial consultation for
Tax Advantaged Long/Short SMA's
COncentrated Stock positions & Diversification through Tax-loss harvesting
- AQR Flex SMA
- Quantinno - DEALS Core, DEALS overlay, DEALS exchange
- Parametric - Custom Extension long/short - Portfolio Margin
- Brooklyn Investment Group (BLKN) - Tax Advantaged Long/short SMA
FLEX Investing SMA
SMA LONG/SHORT FLEX Extensions
MArket neutral & Long/Short SMA - Tax-aware Strategy
Tax-Aware SMA's -Portfolio Margin & Flex Extensions
At Glover Park Wealth Management, we believe that tax-aware investing is a game changer for optimizing your portfolio.
By utilizing direct indexing, we allow you to directly own individual stocks while simultaneously harvesting tax losses, minimizing your tax burden.
Alternatively, our long/short strategies enable us to capitalize on both rising and falling markets, hedging against downturns while seeking growth.
These approaches focus on preserving and enhancing your wealth, all while ensuring your investment strategy aligns with your financial goals.
Let the financial advisors at Glover Park Wealth help you navigate these advanced tax aware long/short strategies to keep more of your after-tax hard-earned money working for you!