Building Your Socially Responsible Portfolio

Personalization is key to everything we do at Wealthfront. And because we exclusively use software we can deliver an even more personalized experience than a traditional advisor. For example, Path creates a tailored financial plan based on your specific data rather than generalized rules of thumb that are widely used by the industry.

Our clients also want a more personalized investment portfolio, so we developed our unique set of PassivePlus® features to allow for more personalization. For example, Direct Indexing allows for incredible flexibility because we actually buy, on your behalf, the individual securities that comprise the U.S. Equities index rather than use an index fund. As a result, Direct Indexing offers an even greater level of tax-loss harvesting for you, and we recently announced it could serve as the foundation for higher returns through factor-based weighting. But we know our clients want a portfolio that also aligns with their beliefs. And thanks to Direct Indexing we’ll be able to offer Socially Responsible Investing, allowing you to build a portfolio that best represents your values.

You’ve Got The Power

The movement towards Socially Responsible Investing is gaining significant traction. Last year a record $5.8 billion was invested in socially responsible funds and an additional $2.9 billion poured in this year through May[1]. We’ve seen numerous requests from our clients wanting to omit buying securities in sectors spanning four main categories: fossil fuels, deforestation, weapons and tobacco. So we’re taking our cue from you and will build a one-click feature to omit one or all of these categories from your portfolio.

When it comes to Socially Responsible Investing, we believe everyone has their own point of view. So instead of defining what being socially responsible means for you, we’re putting the power entirely in your hands. Therefore, any client using Direct Indexing will be able to proactively omit any company through our exclusion list that they do not wish to invest in, whether it falls into the pre-selected categories or not.

What Matters Most: You

We’re working hard to rebuild the financial services industry so that it puts you first. That means optimizing for your personal needs, including your ethics and morals. And software has given us an incredible platform to deliver deeply personalized service at scale. By building a more robust feature for Socially Responsible Investing we’re aiming to put you in the driver’s seat when it comes to building a portfolio that’s right for you.

[1] Source: Bloomberg, 2017.

Disclosure

Nothing in this communication should be construed as an offer, recommendation, or solicitation to buy or sell any security. Wealthfront’s financial advisory and planning services, provided to investors who become clients pursuant to a written agreement, are designed to aid our clients in preparing for their financial futures and allow them to personalize their assumptions for their portfolios. Additionally, Wealthfront and its affiliates do not provide tax advice and investors are encouraged to consult with their personal tax advisors.

All investing involves risk, including the possible loss of money you invest, and past performance does not guarantee future performance. Wealthfront and its affiliates rely on information from various sources believed to be reliable, including clients and third parties, but cannot guarantee the accuracy and completeness of that information.

PassivePlus® is a registered trademark and property of CSSC Investment Advisory Services, Inc. (“CSSC”) and is used under license. CSSC and Wealthfront are not affiliated companies


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