5 The 21x figure is based on a tax alpha of 2.11% above market performance and Frec’s 0.10% annual fee. The 2.11% projection was generated by Frec’s Direct Indexing Model tracking the S&P 500 and is hypothetical, does not reflect actual investment results, and is not a guarantee of future results. The simulations were run to tax loss harvest on a weekly basis in a ten-year time frame of ninety day increments from 12/17/2003 – 6/10/22 with a $50,000 initial deposit. The simulations averaged at the end of year ten resulted in a 45.1% accumulated tax loss savings that were reinvested with a 42.3% tax rate, and includes Frec’s 0.10% fee, resulting in a 2.11% additional return. Past performance does not guarantee future results.
6 Data as of 09/20/2023. Fees for traditional brokerage refers to the largest U.S. brokerage firms that offer direct-to-consumer direct indexing products. 1.0% for wealth advisors: “What to know about financial costs” U.S. News & World Report, July 27, 2023.
7 Expense ratio data as of 09/20/2023. SPY is an exchange traded fund and not a traditional brokerage firm or wealth advisor. SPY is one of four ETFs that track the S&P 500 index and used as an example because it’s the largest and first ETF to track the S&P 500 index. Information on the other ETFs that track the S&P 500 index can be found at: https://www.etf.com/topics/sp-500.
Direct index strategies and treasury advisory services are provided by Frec Advisers LLC (“Frec Advisers”), an SEC-registered investment adviser. See Frec Advisers Form ADV Part IIA for additional information, including details on the US direct indexing strategies. Frec Advisers does not guarantee that the results of its advice, recommendations, or the objectives of its direct index or cash management strategies will be achieved. We make no assurance that the investment process will consistently lead to successful investing. Before you invest, you should carefully review and consider your investment objectives as well as the risks, charges, and expenses of the underlying securities. There is a $20,000 account minimum required to participate in Frec’s direct indexing strategies.
The S&P 500 and S&P 500 Information Technology Indices are products of S&P Dow Jones Indices LLC or its affiliates (“SPDJI”) and has been licensed for use by Frec Markets, Inc. Standard & Poors® and S&P® are registered trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”); and these trademarks have been licensed for use by SPDJI and sublicensed for certain purposes by Frec Markets, Inc. Frec’s Direct Indexing is not sponsored, endorsed, sold or promoted by SPDJI, Dow Jones, S&P, or their respective affiliates and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of the S&P 500 and S&P 500 Information Technology Indices.
Brokerage products and services are offered by Frec Securities LLC (“Frec Securities”), an SEC registered broker-dealer, member FINRA/SIPC. Investing involves risk, including the risk of loss. Borrowing on margin can add to those risks – please read Frec’s Margin Disclosure before borrowing. Margin accounts require a $2,000 minimum. Any stocks shown are for informational purposes and should not be considered a trade recommendation.
Frec Securities does not provide investment advice. Neither Frec Securities nor Frec Advisers provide tax, or legal advice. Frec’s website, brokerage, and advisory services are not intended for persons of any jurisdiction where Frec is not authorized to do business. Tax savings will vary from client to client due to many factors including market conditions, tax characteristics of securities, client-imposed investment restrictions, client tax rate or status, and changes in tax regulations.