Optimal Asset Management has launched a direct indexing service for institutional investors and investment advisors. The indices available for direct indexing are S&P Dow Jones Indices’ flagship S&P 500, S&P MidCap 400, S&P SmallCap 600 and select factor indices.

Since launching in 2012, Optimal Asset Management has emerged as a leader in the democratisation of investment technology and practice. Adding direct indexing services through Factor Allocator, a comprehensive platform which was introduced in 2017, is Optimal Asset Management’s latest phase in delivering institutional grade solutions to pension funds, family offices and investment advisors to whom such solutions were previously out of reach.
 
“In my many years of working with large institutions, I often asked myself, ‘Why do the big guys have access to all these tools to make their investing more efficient while the rest of us do not?’” says Vijay Vaidyanathan, PhD, Chief Executive Officer at Optimal Asset Management. “Factor Allocator now packages the tax efficiency and customisation offered by direct stock ownership in separately-managed client accounts, with unparalleled ease of use for the benefit of a broader universe of market participants.”
 
Direct indexing is a modern, breakthrough approach to index investing. Instead of ownership through a pooled intermediary, the investor directly holds the exact proportion of underlying securities that make up the index, using fractional shares as needed.
 
“The availability of S&P DJI’s headline equity indices alongside their factor counterparts helps to deliver a dynamic suite of index portfolios measuring the US equity markets via this wrapper that expands access,” says Vinit Srivastava, Managing Director, S&P Dow Jones Indices.