2. Direct indexing-Beat the mutual funds at their own game

Is Direct Indexing the Next Evolution of Index Funds?

Index funds and lower trading fees have democratized the investment markets. But wealthy investors still have access to many options regular investors do not. However, technology is changing those norms.

Technologies at leading robo advisors give more investors access to tax-loss harvesting. And now, advances in trading technologies are opening up the markets to direct indexing from regular investors.

Not that long ago, investors had to call a stockbroker and pay a $50 fee to trade a single stock. Now you can trade stocks for $5 from many brokerages, and one app offers free trades. In recent years, a massive number of dollars have flowed into index funds, with industry leader Vanguard passing $4 trillion in assets under management. As of 2016, 42% of U.S. stock mutual fund assets are held in passive funds.

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