Portfolios Emphasize Increased Tax Efficiency - with the Goal of Reducing Overall Tax Liability
This style of active management utilizes an all-weather approach to investing paired with a heightened sensitivity to the tax implications of investment decisions. During regular portfolio exchanges and rebalancing – this strategy considers the tax consequences of any realization of capital gains and losses.
Because tax-efficient funds have a lowtax liability, they are often good investments to make outside of a tax-deferred account.
What are the Primary Objectives?
How is this Achieved?
Managers who disregard the tax consequences of their trading can generate very concrete and immediate tax costs. Rebalancing without factoring in gains often results in realizing such a large amount of capital gains that pretax returns might be completely offset by taxes on those gains.
After all, wealth compounds after tax.
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*Biblically Responsible Investing (BRI) has certain risks based on the fact that the criteria excludes securities of certain issuers for non-financial reasons and, therefore, investors may forgo some market opportunities and the selection of investments available will be smaller.