The most optimal tax alpha portfolio can be built with a custom index of 60 to 100 stocks that tracks an index.

bantam inc. jack duval financial planning for attorneys - tax alpha image

This Greek letter is remarkably hard to find.

I've written previously about how taxes are a killer of investment returns, why investors should focus on minimizing their three "partners", and the generation of planning alpha. In this post, I want to focus on six ways to generate tax alpha.  By "tax alpha", I mean excess returns generated by using

tax strategies that minimize capital gains and income taxes and maximize the benefits from realizing losses. Tax Alpha Focus on where you own your assets As I've written about, you want to own fixed income in tax-advantaged accounts such as IRAs and 401(k)s and not in taxable accounts.  This…

bantam inc jack duval company town risk hurricane florence

Everyone has an investment plan, until they get hit by a hurricane.

As I have written about in my Company Town Risk series here, here, and here, many investors have overlapping risks throughout their total wealth. Total wealth is comprised of four elements: Human Capital (represented as the present value of all future cash flows from work); Pensions; Real Estate, and; Investments.

Hurricane Florence and Wilmington, North Carolina Investors living in Wilmington, North Carolina, where Hurricane Florence made landfall today, are likely facing severe negative impacts to many, if not all, elements of their total wealth. If they work in Wilmington or own a business there, their Human Capital will be impacted,…

All investors have three partners. They are all bad partners and their involvement in investments should be actively minimized.

As I've written about in previous blog posts, investment fees and taxes are wealth confiscators that have serious negative compounding effects on capital appreciation. One way to think about this is that every investor has three partners: their advisor, the investment manager, and the government. Three Partners Wealth Confiscation The advisor

and investment manager take a percentage of the account returns (or principal in down years) in the form of asset management fees and/or commissions.  The government operates a non-consensual profit sharing arrangement where it takes a percentage of the realized gains and gives an offset for losses to be…

Credible QOZ impact measurement will need to be done by a third-party fiduciary.

Bantam is pleased to officially launch our Qualified Opportunity Zone Impact Measurement product.  (This blog post continues my series on Qualified Opportunity Zones ("QOZs").  You can read my other posts here.) QOZ Fund Investment Risks There are two primary non-investment risks to QOZ investments:  the appearance of gentrification and the

potential for future legislative changes that require reporting on the local impact of the investment. Both of these risks can be addressed by proper QOZ impact measurement and reporting. Since the QOZ initiative was a bi-partisan effort, and other programs such as the Low Income Housing Tax Credit and New…

No one would want to buy a stock at $100/share and immediately have a $60/share cost basis, but that's what happens with mutual funds.

bantam inc jack duval financial planning for attorneys - blind trust image

If justice can be blind, so can your portfolio.

Many attorneys work at firms that have prohibitions against owning individual securities.  This removes potential conflicts of interest that could lead to lost business or the appearance of impropriety. The result of this is that attorneys at these firms are often invested in high fee and tax-inefficient mutual funds.  This

is a mistake that can, and should, be avoided. There are at least two ways to avoid investing in mutual funds and still comply with firm by-laws: utilizing a discretionary separate account, or; investing through a revocable blind trust. Discretionary Accounts Many of the same firms that prohibit the ownership…