Giving You An Edge

Wealthfront is built on the philosophy that passive investing is the key to long-term success. But we always try to go above and beyond to help your portfolio perform better. In other words, we try to give you an edge.

To do that we first launched Tax-Loss Harvesting, which takes advantage of movements in the market to lower your tax bill without disrupting your overall investment strategy. Then we built Direct Indexing, an enhanced form of Tax-Loss Harvesting that looks for movements within individual stocks to lower your tax bill even more. Today we’re excited to announce our newest investment feature: Advanced Indexing.

 An improvement on a strategy commonly referred to as “Smart Beta”, Advanced Indexing works to increase your returns by weighting the individual securities in your portfolio more intelligently. Academic research shows that stock returns are determined by their exposure to “factors,” or common sources of risk. By optimizing the portfolio’s exposure to a collection of time-tested factors, our research team was able to deliver a strategy that can improve returns, while closely tracking the performance of the broad index. And our expert technology enables this to happen automatically, without any effort on your part.

Advanced Indexing is available now to clients with at least $500,000 in their Wealthfront taxable investment account. Here are the primary benefits of Advanced Indexing:

It’s tax-efficient

Because Advanced Indexing is paired with Direct Indexing, we’re able to minimize the impact of taxes on your excess returns. No other Smart Beta service or fund is able to do this.

It’s multifactor

While there are many investment factors to consider when assessing an individual security, 95% of Smart Beta ETFs only use one factor[1]. But our research team analyzed the data and determined that by diversifying across factors, you can improve your returns, keep the risk of your portfolio unchanged, and maximize the chances of outperforming a simple, cap-weighted index.

It has no fee

Advanced Indexing is available for no additional fee above and beyond the standard Wealthfront advisory fee. This is significant, as no other issuer of a factor weighted index funds does this. In fact, they often charge an incremental fee at least equal to the benefit of the feature. With Advanced Indexing all of the benefit goes to you.

Putting it all together

With the addition of Advanced Indexing, we now have three unique value added investment features that you can’t find combined anywhere else. So today we’re also excited to announce that these features now live under the name PassivePlus®.

When we launched Wealthfront our goal was to democratize access to sophisticated financial services. With PassivePlus, we’re over-delivering on that promise so you can live the life you want to live.

[1] MorningStar, 2016

Disclosure

Nothing in this communication should be construed as an offer, recommendation, or solicitation to buy or sell any security. Wealthfront Inc. is an SEC-registered investment adviser. 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. 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. For more information please visit www.wealthfront.com or see our Full Disclosure.

Learn more about the features in PassivePlus by reading our Tax Loss Harvesting Whitepaper, our Direct Indexing Whitepaper, and our Advanced Indexing Whitepaper.

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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