Wealth Management

According to Marcy Keckler, senior vice president of financial advice strategy at Ameriprise Financial, couples consulting a financial advisor tend to be more transparent about their finances, emphasizing the importance of selecting an advisor jointly. Keckler highlights the optimistic trend in couples' financial communication, as revealed by the Ameriprise Couples, Money & Retirement study, which surveyed over 1,500 American couples with substantial investable assets. 


The study indicates that the majority of couples trust each other on financial matters and share similar retirement goals. Keckler stresses the necessity for advisors to engage with both partners from the outset, ensuring a balanced relationship and effective financial planning.


Furthermore, the survey underscores the crucial role of advisors in addressing couples' concerns, such as providing support to family members and navigating retirement uncertainties. While most couples plan to retire simultaneously, the reality often diverges, requiring flexibility in retirement planning. The study's recommendations include open communication about financial objectives, resolving disagreements constructively, and collaborative selection of a financial advisor. Despite positive findings, challenges such as estate planning and financial transparency persist, highlighting the ongoing need for advisor assistance in fostering financial harmony among couples.

Finsum: The couple adds a different dynamic to the advisor client relationship and understanding their needs is fundamental, as more are seeking advisors in pairs. 

Direct indexing has witnessed a meteoric rise, with investments in direct indexes eclipsing $260 billion by the end of 2022. This method, involving the investment in individual securities comprising an index rather than the index fund itself, offers a distinctive set of advantages. 


It not only aims to closely replicate index performance but also holds the potential to significantly enhance tax efficiency. Furthermore, direct indexing provides a level of customization surpassing conventional index funds, making it increasingly attractive for those seeking tailored investment approaches. Direct indexing is gaining momentum, particularly due to its ability to mitigate risk concentration. 


Through this strategy, investors can manage individual components for tax purposes more effectively. By liquidating underperforming securities to offset taxable gains elsewhere in their portfolio, investors can potentially reduce tax liabilities and enhance tax efficiency. However, it's essential to navigate this strategy within the confines of the wash sale rule, which prohibits claiming a tax deduction for a sold security if a substantially identical one is purchased within 30 days before or after the sale.

Finsum: More needs to be said about direct indexing reducing risk in the portfolio by selecting and deselecting stocks based on their risk profile. 

Amidst higher interest rates, achieving alpha and managing risk in corporate credit necessitates a nuanced approach. Josh Lohmeier of Franklin Templeton Fixed Income unveils a dynamic portfolio construction method adaptable to diverse investor profiles and market conditions. 


In the current interest rate landscape, sophisticated techniques are essential for capturing alpha with improved downside protection. Alongside meticulous bottom-up security selection, a systematic quantitative portfolio construction process can potentially yield consistent excess returns uncorrelated with peer benchmarks. 


By segmenting the opportunity set based on volatility and strategically positioning along the yield curve, investors can optimize risk allocation and enhance portfolio returns. This adaptable portfolio construction framework offers a repeatable process with consistently positive outcomes, emphasizing the importance of diversification across managers and fixed income portfolios.

Finsum: Quantitative approaches can deliver a more resilient portfolio in times of increased volatility.

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