The Management And Mismanagement Of Taxable Assets
- Topics:
- Commercial Lending
- Tags:
- Asset,
- Asset Management,
- Business Operations,
- Finance,
- Financial Planning,
- First Quadrant,
- Free Trade,
- Operational Planning,
- Taxes
- Source:
- First Quadrant
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Overview: As the adage implies, taxes are unavoidable, as we are all made acutely aware each April. In addition, individual investors are not alone. Virtually all companies also contend with the taxes, not only on operating earnings but also on large segments of their investable assets. Despite the inevitability and importance of taxes, most institutional management of taxable assets does not get the attention that it deserves. For this reason article provides few points that should be considered by the owner of the taxable assets. Broadly these are categorized into do’s and don’ts: 1. Don’t sell any existing portfolio just to buy an index fund, 2. Don’t handle manager transitions in a conventional fashion, 3. Don’t allow equity sales at a substantial profit etc. and the do’s are: 1. Do harvest losses, 2. Do encourage managers to realize losses, even to the point of taking losing assets away from managers who don’t harvest their losses! 3. Do apply a yield tilt, 4. Do consider reducing fees.
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Format: PDF | Size: 176KB | Date: Jan 2003 | Pages: 12
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