In this week’s podcast, Nucleus Wealth’s Chief Investment Officer, Damien Klassen, explores how direct indexing can give investors more control over their portfolios — allowing you to choose the companies you own, manage your exposure to different themes, and tailor your investments around your own goals and preferences. We unpack what makes direct indexing different from traditional funds and how greater control can translate into a more personalised investment strategy.
Key Talking Points
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Indexes can be concentrated: A global index may still have heavy exposure to a few countries and large companies, so investors should understand what they own.
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Country labels can mislead: A company’s listing country does not always reflect where it earns revenue or does business.
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Direct indexing offers control: Holding individual stocks lets investors adjust exposures, add themes, or screen out companies they want to avoid.
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Portfolios can reflect personal circumstances: Investors can reduce exposure to an employer, industry, or company they already depend on for income or shares.
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Individual share parcels can help manage taxes: Direct indexing can offer more choice about which shares to sell and when, potentially reducing taxable gains.
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Index performance can hide mixed results: An index may rise even while many of its individual stocks fall, creating opportunities to manage holdings and tax outcomes selectively.
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Fees need to be considered together: Specialist ETFs can carry higher costs, so compare the total blended cost with a direct-index portfolio.
Take us on your daily commute! Nucleus Investment Insights is available in Podcast form on iTunes and all major Android Podcast Platforms.
