Direct Indexing

Direct indexing offers complete customization and tax efficiency.

Direct Indexing with IMPACTADVISOR

Personalized, tax-optimized
Aligned with your long-term goals.

IMPACTx Optimizer makes it a win-win:

Superior after-tax returns + Socially-Selective

① Power of Choice

Complete customization: your portfolio can be diversified around a wide range of options. Your core values can be an input for the portfolio construction engine that seeks best-of-breed companies in a responsibly-diversified portfolio.

② Effortless Tax Optimization

Direct Indexing can add 1-2%+ annually of 'tax alpha':
AI/ML (machine learning) methodology for gain & loss realization that is tailored to your tax profile and the realtime market conditions.

No-Compromise Investing, without Compromising Performance.

Direct Indexing Is Taking Off...

Jason Escamilla, co-founder of ImpactAdvisor, who built his own direct-indexing platform for his ESG-focused and high-net-worth clients in California: It’s a long-term commitment to reap the compounding benefit of tax-loss harvesting, and it’s best for investors who will likely always have high capital gains to write off.

Investors who don’t have the long-term time frame to enjoy the tax benefits of direct indexing should stick to ETFs, Escamilla suggests.

Nate Geraci of the ETF Store says direct indexing is a better option versus ESG ETFs for those investors who hold very strong beliefs because the strategy is so targeted. “It does offer a very elegant solution to allow investors to express their personal preferences,” he says.

Barron's, Dec. 2022

Evolution of Indexing | Direct Indexing

For investors in high-tax states with taxable-account holdings, direct investing allows much easier tax-loss harvesting, because he can trim individual stock holdings, rather than a basket of ETFs.

“You open up a wide range of tax opportunities,” he said, including moving appreciated holdings into donor-advised funds.

“The beauty of direct indexing is you can pick what your definition of responsible investing is,” Escamilla added

ETF Report, March 2021: The Indexing Issue

Direct Indexing | Advisors & ETFs: A Perfect Match?

There are two benefits to direct indexing: better customization and even greater tax efficiency. Being based in San Francisco with clients in the technology industry and residing in a high-tax state such as California, direct indexing makes a big difference, Escamilla adds.

“Direct indexing is an incredible product for a high net worth person who has professional support from a CPA and an advisor,” he says, noting direct indexing brings a level of complexity. “If you do direct indexing, you start to lose your ability to do your taxes on an iPhone app.”

...another way he mitigates tax hits is to use closed-end municipal bond funds. Escamilla watches for sizable discounts to occur, such as what happened in the March sell-off, which gives him a margin of safety for clients while adding alpha over time., Sept. 2020

We help our clients achieve their financial and personal goals, while giving them the power of choice to invest in alignment with their own mission statement.
Our Mission: To drive the adoption of sustainable investing into the mainstream, while aiming for superior after-tax returns.

IMPACTADVISOR ("ImpactAdvisor") is an investment advisor registered in California.
FINRA CRD# 175155 (Financial Industry Regulatory Authority / Central Registration Depository).

Our Tax Philosophy: Any tax-related advice provided to clients appropriately reflects the actual amount of income generated by the client over time; and the tax advice provided to a client for a jurisdiction appropriately reflects the actual operations of the client in that jurisdiction. Our specialty is in helping our clients shape and preplan events to reduce or eliminate tax liability within the parameters of the law.

This website should not be construed as a solicitation or offer to sell investment advisory services or as an offer or recommendation to trade in any security. Financial services are only provided to investors who become ImpactAdvisor clients after entering into a written agreement.

Past performance does not guarantee future results. Investment products are not FDIC insured, are not bank guaranteed and may lose value.

Privacy Policy

©2024 IMPACTADVISOR LLC. All Rights Reserved.