Targeted Wealth Solutions

Direct indexing is an investment approach where a portfolio holds individual stocks that replicate an index, rather than owning an index mutual fund or ETF. Targeted Wealth Solutions uses this structure to harvest tax losses at the individual security level, an option unavailable in pooled funds. The firm can also tilt portfolios away from certain sectors or specific stocks for clients with concentrated positions or ethical exclusions. This approach converts market volatility into potential tax savings while maintaining broad benchmark exposure.

No. Targeted Wealth Solutions invests client capital directly into individual securities rather than its own branded mutual funds or ETFs. This product-agnostic model removes the conflict between a fund manager's need to minimize taxable distributions and a client's need to maximize after-tax returns. The firm's revenue comes from advisory fees on assets under management, not from product sales or commissions.

Portfolios are constructed by sampling or fully replicating broad-market indices such as the S&P 500, using optimization algorithms that balance tracking error against tax-loss harvesting capacity. The firm can apply client-specific constraints on individual stocks, sectors, or ESG factors without deviating materially from the benchmark's risk profile. Rebalancing occurs continuously and is driven by thresholds for tracking error, cash flows, and harvesting opportunities.

Because the firm owns individual securities, it can screen out categories of stocks that a client wishes to avoid—such as weapons manufacturers, tobacco companies, or fossil-fuel producers—while maintaining broad market exposure through the remaining securities. This is a direct-indexing capability not available to investors using commingled funds, and the firm implements it at the individual account level.

Targeted Wealth Solutions charges an asset-based advisory fee calculated as a percentage of the market value of managed accounts. The firm does not collect commissions, 12b-1 fees, or revenue-sharing payments from product providers. This fee-only structure aligns the firm's compensation with portfolio growth, while the direct-indexing execution aligns it with after-tax outcomes rather than pre-tax fund performance.