Tax Harvest Core
Track market exposure. Apply active tax management.
Parametric Tax Harvest Core helps you do both while delivering consistent performance and diversification.
Take an active approach to passive strategies
Parametric Tax Harvest Core seeks to closely match the pretax return of an investor’s chosen exposure while outperforming on an after-tax basis. We construct portfolios with low-cost, highly liquid, sector-based exchange-traded funds (ETFs) and systematically harvest tax losses throughout the year.
Objectives
Client exposure
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Benchmark a portfolio to the S&P 500® or the Russell 3000®.
Active tax management
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Harvest losses throughout the year and defer the realization of capital gains.
Customization
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Restrict sectors, fund portfolios in kind or in cash, and make tax-efficient charitable donations.
How it works
Where Tax Harvest Core fits in a complete investment strategy
Actively managed portfolios aren’t always tax sensitive, and higher turnover could result in significant gain realization. A tax-managed passive mandate as a core holding consistently strives to produce net-realized losses and can help offset gains. This can result in better overall after-tax returns and help your clients keep more of their money invested.
Continuous and active investment management
Our systematic approach to tax-loss harvesting seeks to maximize opportunities for after-tax returns while tracking closely to your client's chosen benchmark. We assess losses at the lot level for each sector ETF, and we harvest losses when value falls 5% below cost basis, purchasing replacement sector ETFs to keep the portfolio in line with its benchmark.
Once we’ve designed and customized the portfolio, our proprietary optimization process continuously manages for both risk and tax-management opportunities.
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Key benefits
Tax Harvest Core offers many of the customization options that set Parametric’s tax-managed strategies apart. You get the freedom to restrict sectors, fund portfolios in kind or in cash, and raise cash and make charitable gifts with enhanced tax efficiency.
More to explore
2023 Investment Outlook: Will We Win the Fight Against Inflation?
by Thomas Lee, Co-President and Chief Investment Officer
December 9, 2022
It was a banner year for tax-loss harvesting and Fed tightening. But what opportunities lie ahead for 2023?
Midyear Tax Outlook: Will Proposed Tax Changes Stop Being Proposals?
by Jeremy Milleson, Director, Investment Strategy
July 18, 2022
Between a divided Congress and worldwide inflation, the timing for President Joe Biden to impose tax changes may be even worse than before.
2022 Tax Outlook: In Pursuit of a Better Mousetrap!
by Andrew Subkoviak, Director, Portfolio Management
January 24, 2022
With the narrowest Senate majority, President-elect Joe Biden won’t have much room to pursue aggressive tax reform. What should taxable investors expect this year?