Must read as usual: few points to highlight the fact while the overarching conclusion, that LSDI is often a suboptimal, fee-heavy strategy, is fundamentally sound, their quantitative simulation approach contains several flaws.
Investors with concentrated, appreciated stock positions are being pitched long/short direct indexing programs as a way to diversify without paying capital gains tax.
We built a simulation to test whether the economics and found that in a typical case, fees eat up more than half the tax savings, and the investor ends up with a lower expected after-tax return than if they'd just sold, paid the tax, and bought an index fund