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Tax Advantaged Equity

Established strategies seeking to maximize after-tax returns through active tax management.

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Principles of Investing

Take Advantage of Volatility, in Every Market Environment

When global markets decline, tax-savings opportunities are prevalent, but those events are less frequent. Finding opportunities within up markets is critical to generating a higher after-tax capital base.

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U.S. Equity Positive and Negative Performing Stocks (Annually)

Historical trends are not predictive of future results. Source: Bloomberg, Northern Trust Asset Management. Data from January 1, 2001 to June 30, 2023. U.S. Equity is represented by the S&P 500 index. It is not possible to invest directly in an Index.

Principles of Investing

Take a Multi-Dimensional Approach to Maximize After-Tax Growth

Asset transitions can create large tax liabilities and unnecessary gains if managed as a one-off event – performing regular analysis across investor-specific scenarios is necessary to ensure assets can be optimally transferred, as needed.

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Sample Asset Transitioning Options and Outcomes

This information is general in nature and should not be construed as tax advice. Please consult a tax advisor or professional as to how this information may affect your particular circumstances. For Illustrative Purposes Only. Tax rates assumed to be 40.8% ST, 23.8% LT. The rebalancing scenarios presented above are based on the individual equity holdings in the portfolio. The initial portfolio holds 223 names with a market value of $13.19 M and has 334 bps of active risk relative to the S&P 500 index. Past performance is no guarantee of future results. Index performance returns do not reflect any management fees, transaction costs, or expenses. It is not possible to invest directly in any index.

Principles of Investing

Tailor the Strategy to the Investor

Creating true after-tax alpha requires a personalized approach – even the most efficiently managed U.S. equity strategies could leave you with 10%+ tax liability.

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Hypothetical Growth of $1 Million for Most and Least Tax-Efficient U.S. Equity Managers – Last 15 Years

Source: Northern Trust Asset Management, Morningstar, as of August 31, 2023. Managers from Morningstar U.S. Equity universe were divided into quartiles based on their Tax-Cost Ratio over 15 years. The average annualized total returns and post-tax returns (pre-liquidation) we used to calculate the hypothetical growth of $1 Million investment in each group over the 15 year time period. The difference in the total return growth and the post-tax return growth represents the total average 'tax cost' for each group of managers.


Without tax management of their investments, taxable investors realize a “tax drag” that hurts their wealth accumulation, compounding over time. We actively trade portfolios throughout the year to outperform investors’ chosen benchmark on an after-tax basis while managing active risk.

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