Custom Core® Equity | Custom SMAs | Wealth Managers

Custom Core^® Equity

Parametric’s Custom Core solution lets your clients invest according to their style preferences, responsible investing criteria, and tax considerations.

Customized solutions are powerful portfolio-management tools, but they can be time-consuming to implement. Our Custom Core solutions make custom direct indexing simple and scalable, freeing up time to grow your business and deepen client relationships.

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Custom Core is a passive portfolio of stocks that adheres to a client-chosen benchmark, delivered as a separately managed account (SMA). With SMAs clients own each individual underlying security directly, allowing them to have a high degree of personalization based on their situations and needs.

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Next-level advisor tools and comprehensive reporting

Get deep insights into your clients’ portfolios. Our secure platform for advisors features an easy-to-use interface with robust reporting and tools.*

* Not all tools are available to all advisors. Tools require login. Register today.

All our tools allow you to build and evaluate portfolios customized to your clients’ unique situations.

> Portfolio Lab

Benchmark Builder
ESG Screen Analyzer
Transition Analysis Explorer

> Tax Alpha Simulator

> Custody Fee Calculator

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Why choose Parametric?

$409.8B+

Total firm AUM

$121B

Customized equity solutions AUM

178

Portfolio managers

30+

Years of tax management experience

As of 3/31/2023

How Custom Core works

Design the exposure

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Select a licensed benchmark, a Parametric strategy, or a blend of the two to create a custom benchmark.

Customize

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Create customized exposure or investment styles via factors, tax management, responsible investing options, and more.

Continuous management

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Our proprietary optimization process continuously manages for both risk and tax-management opportunities.

Frequently asked questions about Custom Core

How do I create a Custom Core portfolio for my clients?

Start by choosing an equity base, such as a licensed benchmark, one of our own strategies, or a custom blend. This way your clients get exactly what they want in a single portfolio without having to buy multiple ETFs to achieve the same thing.

What customization can be applied to Custom Core portfolios?

Clients can customize their portfolios by investing in their chosen base and eliminating the companies or sectors that don’t align with their religious, environmental, or social principles. Your clients can also access research-driven environmental, social, and governance (ESG) exposures through our partnership with Calvert, a global leader in responsible investing.

How does Custom Core actively manage taxes?

Taxes can be a bigger drag on returns than investment fees or trading costs. We continuously monitor investments for tax-loss harvesting opportunities, which can be used to offset capital gains within Custom Core or in other parts of your clients’ portfolios.

Can my clients use factor investing with Custom Core?

Yes. We offer a range of single-factor or multifactor strategies available for our Custom Core portfolios. Clients can also create their own customized factor blends.

How does Parametric manage transitions?

Advisors get an easy-to-understand transition analysis to use with their client, detailing the trade-offs between tracking error and taxes from realized gains.

How do I get insights into my clients’ Custom Core portfolios?

We’ve built a secure platform for advisors with an easy-to-use interface and robust reporting tools.* Find out how our Benchmark Builder, ESG Screen Analyzer, and Tax Alpha Simulator allow you to gain deep insights into your clients’ portfolios. Learn more.

*Not all tools are available to all advisors.

Intended benefits of Custom Core Equity

Flexibility

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Choose a licensed benchmark, a Parametric strategy, or a custom blend to create a portfolio that meets your clients’ desired exposure.

Customization

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Add factors, responsible investing criteria, or risk management overlays for even greater customization.

Tax management

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Third-party research has shown that tax management can add 1%–2% in after-tax excess returns.*

Charitable gifting

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Clients can gift individual securities from their Custom Core portfolios in a tax-efficient and risk-controlled manner.

* Shomesh E. Chaudhuri, Terence C. Burnham, and Andrew W. Lo. 2020. “An Empirical Evaluation of Tax-Loss-Harvesting Alpha.” Financial Analysts Journal 76:3, 99–108. This study did not involve Parametric or its clients. There is no guarantee that a tax-management strategy will result in increased after-tax returns. Results will differ based on an individual investor’s circumstances.

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