Allocation Over Dollar Cost Averaging: Looking at the Long Term

Marc Schechter, CEO of Schechter Investment Advisors, advocates for a disciplined, long-term allocation strategy over short-term market timing. Effective portfolio management relies on rebalancing based on target percentages across equities, real estate, and private credit rather than reacting to temporary market corrections. Direct indexing offers a superior alternative to traditional ETFs by allowing for continuous tax-loss harvesting; investors can sell individual declining stocks within a replicated index to offset gains while maintaining market exposure. While public markets favor low-cost passive investing, active management provides significant value in inefficient asset classes like private equity and private credit, which historically outperform their public counterparts by approximately 4%. These alternative investments require careful liquidity planning, as they often involve multi-year commitments or potential withdrawal restrictions. This approach prioritizes tax efficiency and customized exposure to illiquid markets for investors capable of handling reduced flexibility.