Frec news
Frec launches Diversify and High leverage long short
2 min read
Frec is entering the new year with continued growth and more ways for investors to manage portfolios with greater control and tax efficiency. We’re approaching $700M in customer assets, quadrupling our assets from last year, and launching two highly requested products: tax-efficient diversification of concentrated stocks and higher leverage choices for our long short direct index.
Introducing Frec Diversify
Investors who are heavily concentrated in a stock, often from company equity or years of appreciation, and wish to diversify may be faced with a large tax bill.
Frec Diversify offers another path.
You bring us your concentrated stock, and we build a portfolio that mimics a broad market index using long and short overlays. The overlays immediately reduce your concentration risk while systematically harvesting tax losses. Over time, this framework accumulates losses to offset gains as we gradually sell down your concentrated stock, helping you diversify while minimizing your tax impact.
The investment minimum for Frec Diversify is $100,000 and carries an annual fee of 0.60% plus 0.30% post-tax financing costs1. For a full technical walkthrough, please see our white paper.
High leverage options for Frec Long Short Direct Indexing
Since launching our 140/40 long short direct index, one of the most frequent requests has been greater leverage flexibility to further amplify market returns and tax savings. Now, investors can choose from:
- 140/40 with a value, quality, or growth tilt
- 200/100 with a quality or growth tilt
- 250/150 with a quality or growth tilt
These new options enable investors to increase return potential while significantly expanding tax-loss harvesting capacity. According to historical simulations, a 250/150 direct index tilted towards quality can produce 8.49% in after-tax excess return, and harvest up to 337% of the initial investment over 10 years2.
Minimum investment for 200/100 and 250/150 long short strategies is $500k, and annual fees range from 1.00%-1.30%, plus 0.57%-0.86% in post-tax financing costs3.
For details on construction, simulations, and risk management, please see our long short direct indexing white paper.
Get started
Frec Diversify and higher leverage long short are both available on Frec for self-serve onboarding. Existing customers can get started by navigating to the Invest tab.
For those not on Frec yet, creating an account takes a few minutes.
If you have questions or need assistance getting started, reach out to us at help@frec.com.
