Wealth Management
Determining when to opt for direct indexing over ETFs depends on specific client situations, as outlined in Dr. Stephanie Lo's recent research for NDVR. She suggests that direct indexing may offer advantages only under certain conditions, particularly when considering after-tax returns over the long term.
The key factors involve embedded capital gains in an existing ETF portfolio; transitioning to direct indexing may trigger immediate tax liabilities that could outweigh the benefits of tax-loss harvesting. However, for new investors starting from cash, direct indexing might be more advantageous, assuming the fees are competitive and the investment horizon is long enough.
The decision also hinges on the investor's tax profile, inheritance plans, and desire for portfolio customization or specific exposures, such as building around a concentrated position. Advisors should assess each client's goals, costs, and preferences to determine if direct indexing aligns better with their investment strategy than traditional ETFs.
Finsum: As with all strategies you need determine if the tax alpha is really the advantage promised but in some cases the returns can be great.
Modern wine bars are shifting away from strict dining etiquette, embracing a more relaxed and exploratory approach. When sampling wines by the glass, it’s courteous to limit your tastings to around three options to avoid overburdening the staff.
If a bottle seems off, promptly communicate with the server, as minor flaws may become noticeable only after some time. Generally, ordering a bottle is more cost-effective than several glasses, providing better value for your money.
Tipping remains consistent at around 20%, regardless of whether you’re at a counter or table service. Bringing your own bottle is usually discouraged, but if done, ensure you adhere to house rules, such as purchasing a bottle from their list and covering any corkage fees
Finsum: The wine world can be overwhelming so these tips can help you feel more comfortable in the complex environment.
By 2040, adults retirement age are expected to make up 22% of the U.S. population, creating new investment opportunities in sectors catering to an aging demographic. One promising area is medical outpatient buildings (MOBs), which are increasingly in demand as healthcare systems shift toward outpatient care to provide more flexible services.
A notable example is KKR & Co.'s partnership with Healthcare Realty Trust, which has already committed nearly $500 million to acquire and develop MOB properties.
While Healthcare Realty Trust has faced challenges, including tenant bankruptcies, it has made strides in improving its financial stability and expanding its portfolio. With favorable demographic trends and a focus on outpatient facilities, the company may have a strong runway for future growth despite current market volatility.
Finsum: This is innovative thinking and could prove a useful way to invest in healthcare.
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The interval fund market has seen notable growth in the first half of 2024, with net assets reaching $86.4 billion, a jump of nearly 11% since the first quarter, according to Robert A. Stanger & Co. Similarly, Morningstar reports that 100 interval funds manage approximately $80.7 billion, highlighting a rising trend fueled by RIAs.
XA Investments adds that there are currently 110 interval funds managing $101.6 billion, with expectations to see up to 255 funds and $175 billion in net assets by the end of the year. The sector has rebounded from last year’s challenges in real estate-focused funds, now propelled by increased interest in credit and private equity strategies.
Cliffwater LLC has emerged as a leader, managing nearly a quarter of the market's assets, with its private credit interval funds raising $4.9 billion so far this year. Meanwhile, infrastructure-focused interval funds are also seeing increased investor attention, contributing to a broader market expansion.
Finsum: It’s clear this is a new trend for RIAs and that they are seeing something in interval funds that their clients need.
As the leaves begin to turn, travelers are finding that fall offers the best deals for getaways, with accommodation prices hitting their lowest compared to other seasons. This makes fall an ideal time for those seeking cost-effective travel options.
States like North Dakota, Maine, and Massachusetts have seen a notable increase in stays, attracting visitors with their vibrant foliage and seasonal appeal. The trend of passion-driven travel, where people choose destinations based on their interests—such as music festivals, food events, or outdoor adventures—continues to shape how people plan their trips.
Japan, with its blend of tradition, modernity, and stunning fall landscapes, remains the top international destination for American travelers for the second consecutive year. From budget-friendly domestic trips to unique international escapes, the fall season provides endless opportunities for exploration and memorable experiences.
Finsum: There are some dreamy destinations that really optimize the fall weather and visual experience on this list.
Investors are increasingly turning their attention to the real estate sector as the Federal Reserve signals a potential shift toward lowering interest rates. Over the past month, five major U.S.-listed real estate ETFs have collectively seen net inflows of $2.2 billion, a figure that accounts for more than half of their total inflows over the last year.
This surge in capital reflects growing confidence that the real estate sector stands to benefit from anticipated lower borrowing costs and a more favorable economic environment.
Fed Chair Jerome Powell recently hinted at the Jackson Hole Symposium that rate cuts could be on the horizon, driven by signs of a cooling labor market and progress toward the 2% inflation target. As a result, ETFs like the iShares U.S. Real Estate ETF (IYR) and the Vanguard Real Estate ETF (VNQ) have seen substantial inflows, reinforcing the sector’s strong recovery and positioning it as a key beneficiary of potential monetary easing.
Finsum: Focus on REITs with single family rental performance, because corporate real estate is still dependent on hybrid/work from home policy.