Performance quoted represents past performance, which is no guarantee of future results. Investment return and principal value will fluctuate, so you may have a gain or loss when the portfolio is liquidated. Current performance may be higher or lower than that quoted. Performance of an index is not illustrative of any particular investment and does not include the impact of advisory fees. It is not possible to invest directly in an index.
GHAM invests client portfolios in ETFs that invest in equity securities. Clients will be subject to the risks associated with equity securities, which include the rapid decline of market values due to general market conditions or company-specific factors. To the extent that a particular country ETF is a significant portion of the portfolio, factors impacting that country could cause the portfolio’s value to fluctuate more widely than a more diversified portfolio. The strategy seeks to provide exposure aligned with the benchmark while generating capital losses that may be used to offset taxable gains. GHAM does not seek to outperform the benchmark and thus, client portfolios may underperform other forms of active management.
GHAM does not provide tax advice. GHAM works with outside accounting firms and outside tax counsel that provide ongoing guidance and updates on all relevant tax law. Federal, state and local tax laws are subject to change. GHAM is not responsible for providing clients updates on any changes in tax laws, rules or statutes. Although Green Harvest does not provide tax, legal or accounting advice, we stand ready to assist clients and their advisors in reviewing the relevant tax rules. Composite performance calculations are based on asset weighted average of all accounts in the strategy.
Although there are multiple accounts investing in a similar Global strategy, only 1 account qualified for inclusion based on the GIPS policies and procedures.
The Composite includes all portfolios managed by Green Harvest Asset Management LLC according to the Strategy. The Strategy’s after-tax returns are calculated using actual before-tax returns that have been adjusted to estimate the benefits of using tax losses harvested to offset capital gains and reinvesting the resulting tax savings in the portfolio. For short-term and long-term capital gains realized in each client account, the after-tax return calculation uses the maximum federal tax rates applicable during the tax years shown, which were 40.8% and 23.8%, respectively. For dividend income received in each account, the estimate assumes the maximum federal tax rate of 40.8% applicable to ordinary income. The after-tax returns are hypothetical and may not reflect clients’ actual after-tax performance due to differences in tax rates and other circumstances. As examples, clients with lower applicable tax rates, capital loss carryforwards or no capital gains outside the portfolio are likely to experience lower levels of after-tax returns. In addition, the tax savings and reinvestment are assumed to occur in the tax year, although tax savings are not available during the tax year, and any reinvestment of such savings would occur following the tax year.
Green Harvest has approximated after-tax returns for the benchmark by adjusting the Index’s monthly price returns by its dividend yield after applying a 32.3% tax rate, which assumes that half of dividends are taxed at the 23.8% rate applicable to qualified dividends and the other half at the 40.8% rate for ordinary income. Benchmark after-tax returns are provided for informational purposes only and are not intended as a measure of Green Harvest’s tax alpha compared to the benchmark. Significant differences between the calculation methodologies for Strategy and benchmark after-tax returns limit comparability between the returns. For example, the benchmark returns do not include the after-tax impact of capital gains, and different rates have been applied to dividend income.
Reasons to harvest capital losses, sources of capital gains and the suggestion that mutual funds distribute capital gains are for illustrative purposes only.
The availability of tax alpha is highly dependent upon the initial date and time of investment as well as market direction and security volatility during the investment period. Tax loss harvesting outcomes may vary greatly for clients who invest on different days, weeks, months and all other time periods. A client’s tax alpha will depend on the client’s individual circumstances, which are outside of Green Harvest’s knowledge and control.
GHAM is solely responsible for the content of its website. This material is not intended to recommend or offer any particular security. GHAM is not affiliated with any of the ETF sponsors represented in client portfolios. Initial Anchor Holdings are as of the date stated and are subject to change.
Green Harvest does not employ a Certified Public Accountant on its staff. We work with outside accounting firms and tax counsel for guidance and updates on relevant tax law, and we have reviewed the tax treatment of our transaction structures with those professional advisors. Based on those reviews, Green Harvest is satisfied that our structures support the desired tax results, but we urge clients to consult their own legal and tax advisors regarding the tax treatment of the transactions effected in their Green Harvest account. Such transactions include ETFs and for our Hedging strategies, may also include:
margined equity securities; warrants on margined equity securities or on an eligible index of equity securities; listed options; unlisted derivatives on margined equity securities or on an eligible index of equity securities. Federal, state and local tax laws are subject to change. Green Harvest is not responsible for providing clients updates on any changes in tax laws, rules or statutes. Clients remain fully responsible for their own tax positions.
All data and conclusions derived from data in this factsheet are unaudited and their reliability and accuracy is not guaranteed.
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