Guide to Direct Indexing at Allspring
Learn how direct indexing can help investors personalize portfolios, manage taxes more efficiently, and navigate portfolio transitions through separately managed accounts (SMAs).
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8/17/2026
12 min read
Topic
Direct Indexing
Key takeaways
- Tax-aware investing can help improve after-tax outcomes through ongoing tax-loss-harvesting opportunities.
- Direct indexing allows portfolios to be customized with security exclusions, values-based screens, dividend tilts, and blended index exposures.
- Greater flexibility may help investors manage concentrated positions and appreciated assets more efficiently.
- Allspring's Remi platform supports daily portfolio optimization designed to balance tax opportunities with benchmark alignment.
Executive summary
Tax-aware investing through direct ownership
Direct indexing gives investors ownership of individual securities within an SMA, creating opportunities for ongoing tax-loss harvesting that may not be available through traditional pooled vehicles. By harvesting losses while maintaining market exposure, investors may be able to improve after-tax outcomes over time.
Personalized portfolios built around investor needs
Unlike traditional index funds, direct indexing allows portfolios to be customized based on an investor's unique circumstances and preferences. Investors can incorporate security exclusions, values-based screens, dividend-focused tilts, blended indexes, and other adjustments designed to align holdings with their goals.
Flexibility for complex portfolios
Direct indexing can offer added flexibility for investors with concentrated stock positions, appreciated assets, or evolving tax considerations. A customized approach may help align portfolio changes with an investor's broader financial goals while managing potential tax implications.
Why Allspring for direct indexing?
Allspring's direct indexing strategies are supported by Remi, our technology-enabled SMA platform that combines portfolio management expertise, customization capabilities, and daily portfolio optimization. Through ongoing account review and tax-aware portfolio management, Remi is designed to help investors pursue personalized outcomes while remaining aligned with their investment objectives.
Common questions about direct indexing
- What is a separately managed account (SMA)?
SMAs are professionally managed investment portfolios designed for individual investors. Unlike mutual funds or exchange-traded funds, SMAs allow investors to directly own the underlying securities, such as stocks and bonds. This structure can provide significant advantages, including customization, tax efficiency, transparency, and flexibility, making SMAs a potentially viable option for those seeking personalized and tax-smart investment strategies. Read our SMA overview.
- Who benefits from direct indexing?
Direct indexing may benefit many investors but may be of particular interest to high‑net‑worth individuals with sizable taxable portfolios—especially those in higher tax brackets, where tax‑loss harvesting can meaningfully improve after‑tax returns. It also helps investors address customization needs such as values preferences and concentrated stock positions. In addition, financial advisors and institutions may benefit by delivering more personalized, tax‑efficient solutions to their clients.
- What is tax-loss harvesting?
Tax-loss harvesting is a tax-efficient investment strategy that involves selling securities that have declined in value and using those losses to offset capital gains and reduce tax liability. Proceeds from the sale are then reinvested in similar securities to maintain market exposure while avoiding wash-sale rules. Any losses harvested but not used in the current year can be carried forward to offset capital gains in future tax years. Direct indexing provides tax benefits by enabling security‑level tax‑loss harvesting, allowing investors to capture losses throughout the year instead of only at the fund level. Learn more about the tax benefits of direct indexing.
- How often does Allspring review direct indexing accounts?
We review accounts daily using our proprietary optimization process. Many providers only review monthly or quarterly, which can miss opportunities during market volatility. Our daily reviews allow for more opportunities to capture tax alpha while balancing savings with benchmark alignment. Download Allspring’s direct indexing brochure for more details.
Related insights
Explore the ins and outs of direct indexing, why it matters, and how it can be used to create personalized, tax-smart investment strategies.
This material is provided for informational purposes only and is intended for retail distribution in the United States.
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