Direct Indexing | A Behind the Scenes Look - Featuring Lee Boudouris
Two Quants and a Financial PlannerSeptember 18, 202300:45:50

Direct Indexing | A Behind the Scenes Look - Featuring Lee Boudouris

Many believe that direct indexing will be the next big trend in investing. While it used to be reserved for high-net-worth individuals, zero commissions and the ability to trade partial shares has now brought it to the masses. But does it make sense for investors to utilize the strategy? As is usually the case with all investing tools, the answer is "it depends". In this episode, Lee Boudouris of Sunpointe Investment joins us to look at how direct indexing strategies work and the pros and the cons of the approach.

00:00 - Intro
03:12 - What is direct indexing?
04:58 - The types of investors direct indexing works best for
08:22 - The factors that determine whether a direct indexing approach is appropriate
11:09 - The costs of direct indexing strategies relative to index ETFS
12:35 - The importance of the path of returns
13:59 - Do direct indexing portfolios overweight large companies relative to index ETFs?
17:30 - How direct indexing portfolios handle index changes
20:01 - ESG, factors and direct indexing
24:02 - Is there a behavioral advantage to direct indexing?
28:27 - How direct indexing portfolios limit tracking error while selling losing positions
34:11 - Direct indexing and gifting strategies
37:19 - Five (or six) things to look for in a direct indexing manager
44:08 - Jack needs a collared shirt

ABOUT THE PODCAST
Learning how to be a financial planner is one thing. Doing it is another. Follow along with new financial planners Jack Forehand (@practicalquant) and Justin Carbonneau (@jjcarbonneau) as experienced veteran Matt Zeigler (@cultishcreative) helps them navigate the complex world of financial planning and learn about the most important topics that impact all of our financial futures. From investments to retirement to college planning to estate planning to insurance and beyond, we will cover the major financial planning issues that impact all of our lives and will provide a framework to help investors tackle them. We hope you will join us on our learning journey.

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