The insight behind this post is based on the Animal Spirits podcast episode dated November 20, 2020 about direct indexing (Animal Spirits: Direct Indexing — The Irrelevant Investor)


Direct indexing is an investment strategy where an investor seeks to replicate the risk/return profile of an index by buying individual securities rather than an indexed ETF or mutual fund. The value proposition is multifold: primarily, investors can frequently realize capital losses, which they would net against realized capital gains, thereby effectively ‘maximizing’ their cost basis in the securities they own. This concept, known as “tax-alpha,” can purportedly boost after-tax portfolio…

In Jerome Powell’s November 5th meeting, the Fed chairman again called for further stimulus, saying, “I do think fiscal policy’s absolutely essential here.”

As the pandemic continues to surpass records daily, it has become apparent complacency has set in, likely as a result of “fatigue” from the pandemic. With two concurrent crises: economic and public health, creative solutions need to be considered.

My creative solution: enact additional stimulus that triggers state-by-state when COVID-19 test positivity falls below a certain threshold. Asking folks to modify their behavior on behalf of their vulnerable neighbors was initially effective, but as the severity of…

Differentiating “long-term” and “short-term” capital gains for tax purposes based on a one year holding period is a rule that has outlived its usefulness. This tax should be designed to encourage long-term investment — and implementing such a system is possible today.

For some background, capital gains are earnings realized when an investor sells a capital asset at a higher price than their “cost basis,” often their original purchase price. These gains are taxed by the IRS for two principal reasons: First, capital gains taxes are…

Proxy votes matter.

For anyone unfamiliar with the topic, a proxy vote is an annual vote associated with owning stock in a company. Often, owning one share entitles an investor to one vote. Typical ballot items are the election of directors, the appointment of the auditor, and the approval executive compensation and shareholder proposals such as the lobbying or environmental sustainability reports. Of course management still runs the company, but shareholders are entitled to voice their opinions using this mechanism. Proxy voting was historically done at a company’s annual meeting, but now it’s done online or via mail. …

Matthew Beyerle

Accountant, retail investor, runner, and optimist

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