Wealth Management

Fidelity is about to take direct indexing to a whole new level. The asset manager/custodian/broker-dealer is launching its new Fidelity managed FidFolios product, which is a retail-focused direct indexing suite with only a $5,000 minimum and a 0.40% fee. According to Think Advisor “The Fidelity Managed FidFolios combines direct indexing with fractional share trading, which allows clients to allocate assets among multiple positions based on dollar amount rather than share size”. Morningstar gives context to the launch, saying “This is the most mainstream form of direct indexing from a most mainline asset management and provider of investor services seen to date”.


FINSUM: Direct indexing is a heated battleground for asset managers right now, with Fidelity, Vanguard and others in the mix. This seems like a big step.

Advisors need to make sure their clients are paying heed to their crypto returns as they focus on tax loss harvesting. In the past, many investors “flew under the radar” with their crypto returns, but the IRS is now focused on the issue. Some clients may have major gains that they need to report. The IRS considers crypto to be property, which means investor have to pay taxes on their profits.


FINSUM: Despite how the market looks now, stocks had a great year in 2021, and combined with some potentially big crypto wins, there is a lot of capital gains to offset with tax loss harvesting.

Income investors are flummoxed by the turbulent bond market and many are left wondering what to do. Sure dividend stocks might be an okay option but for those closer to retirement times are too turbulent to rely on them. Instead, rather than sinking your teeth into longer-term bonds with so much interest rate uncertainty, investors should ladder or stagger their fixed rate annuities. Sequencing can allow you to fight the current inflation with better yields than bonds and CDs with more security than equity markets. Additionally, laddering can allow you to be ready to pull out in case bond yields rise to provide more income and on top of that get in at a lower price.


FINSUM: Sure short-run annuities have less return than an ultra-long option but if interest rates pick up you won’t be hung out to dry.

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