Russell Investments survey: Financial advisors see larger role for tax-managed strategies in the second half of 2020

Mid-year results mirror a similar survey conducted in early 2020 prior to the COVID-19 pandemic

SEATTLE, August 3, 2020 — Russell Investments surveyed 104 U.S. financial advisors on the strategies they expect to play a larger role in their portfolios in the second half of 2020. Tax-managed strategies and model portfolios tied with the most votes, and they were followed closely by domestic equities. Other options in the survey, which allowed for more than one choice, included international equities, separately managed accounts, emerging markets, fixed income and real assets.

“It’s not surprising to see tax-managed strategies at the top of the list,” said Frank Pape, senior director, portfolio consulting, at Russell Investments. “Given the volatility we’ve seen in markets YTD and many expecting continued volatility throughout 2020, it presents advisors a great chance to harvest losses in client portfolios. It’s a great time to be tax smart. Advisors who wait to harvest losses in December of this year may have missed the boat.”


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Russell Investments’ mid-year survey obtained similar results to a survey conducted in early 2020, prior to the pandemic, when the same question was asked of 426 financial advisors (see chart below). Then, tax-managed strategies led, with 36% of respondents selecting it as their top strategy for 2020 and 68% picking it as one of their top three strategies. Like the mid-year survey, respondents selected domestic equities and model portfolios as the other two strategies among the top three.

“Advisors likely remember 2018 when equity markets were negative and so many funds had taxable gain distributions,” Pape said. “Given the heavy buying/selling and volatility in equity markets, it appears that mutual funds that are not tax-managed could again have a year with higher-than-average capital gain distributions.”

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About Russell Investments
Russell Investments is a leading global investment firm providing tailored solutions and services to institutions and individuals through financial intermediaries. Russell Investments is dedicated to improving people’s financial security, leveraging an 83-year client-centric heritage rooted in investment innovation. The firm is the fourth-largest adviser in the world with $270.1 billion in assets under management (as of 3/30/2020) and $2.5 trillion in assets under advisement (as of12/31/2019) for clients in 32 countries. Headquartered in Seattle, Washington, Russell Investments operates through 21 additional offices in major financial centers such as New York, London, Tokyo and Shanghai.

Steve Claiborne, 206-505-1858,