Overview
The Transition Analysis Tool helps advisors move an account from existing holdings into a new target allocation in a tax-aware and controlled way.
The tool evaluates:
Current holdings
Embedded gains/losses
Target allocation
Transition timing
Portfolio alignment
It then generates a recommended transition strategy based on the selected tax budget and transition settings.
Why Advisors Use the Tool
The Transition Tool is designed to help advisors:
Reduce realized capital gains during transitions
Gradually move clients into model portfolios
Maintain exposure to target strategies
Compare multiple transition approaches before executing
Key Concepts
Transition Sleeve | Positions that are not immediately liquidated are placed into the Transition Sleeve and gradually transitioned over time. |
Tax Budget | The tax budget controls how much gain the advisor is willing to realize during the transition. |
Scheduler | The Scheduler automates transition activity by evaluating opportunities to liquidate positions while staying within the defined budget. |
Tracking Error | Tracking Error measures how closely the transitioning portfolio aligns with the fully implemented target portfolio. Lower tracking error = closer alignment to the target model. |