Tax Overlay Campaign

For more information, go to investpmc.com. Envestnet | PMC FOR ONE-ON-ONE USE WITH A CLIENT'S FINANCIAL ADVISOR ONLY. 4 UMAOVR-BROC-1223 Glossary Capital Gains Taxes – Taxes paid on profits made from an investment. Short-term capital gains taxes are paid on investments held for less than one year, while long-term capital gains taxes are paid on investments held for one year or longer. In many cases, the tax rate for short-term capital gains is higher than for long-term capital gains. Overlay – Changes made to a portfolio by a third party based on direction given by the client. For instance, a tax overlay involves altering trades dictated by the investment manager to align with the client's tax preferences. Similarly, an impact overlay is when shares of certain companies are sold from a portfolio to reflect the client's personal values and beliefs. Tax Drag – The difference between an investment's pre-tax and after-tax returns due to the taxes paid on the investment's profits. Tracking Error – A statistical measure of how much your portfolio can be expected to deviate from the investment manager's portfolio. Ultimately, a smaller tracking error means your portfolio will be expected to follow the performance of the investment manager's portfolio more closely. A tracking error of 5.0% should be interpreted to mean your portfolio's annual performance will be within +/- 5.0% of the investment manager's 66% of the time and within +/- 10.0% (or double the tracking error) 95% of the time. Unified Managed Account (UMA) – The term refers to both a program and a technology that allows advisors to build a diversified, tax-aware, multi-asset portfolio within a single account/ registration. One can refer to either the individual products or the asset allocations used within the UMA as a "sleeve." The UMA program may include a variety of investment vehicles, including mutual funds and exchange-traded funds ("ETFs"), as well as third-party managed portfolios, such as separately managed accounts ("SMAs") and Fund Strategist Portfolios ("FSPs"). Talk To Our Team Envestnet | PMC's Tax Overlay Services team automates tax management for more than $12B in assets at over 100 firms (as of September 30, 2023). Contact us at PMCOverlayServices@Envestnet.com to learn how you can help your clients manage their capital gains taxes. The information, analysis, and opinions expressed herein are for general and educational purposes only. Nothing contained in this brochure is intended to constitute legal, tax, accounting, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. All investments carry a certain risk, and there is no assurance that an investment will provide positive performance over any period of time. An investor may experience loss of principal. The asset classes and/or investment strategies described may not be suitable for all investors and investors should consult with an investment advisor to determine the appropriate investment vehicle. Investment decisions should always be made based on the investor's specific financial needs and objectives, goals, time horizon, and risk tolerance. Past performance is not indicative of future results. Investments in smaller companies carry greater risk than is customarily associated with larger companies for various reasons such as volatility of earnings and prospects, higher failure rates, and limited markets, product lines or financial resources. Investing overseas involves special risks, including the volatility of currency exchange rates and, in some cases, limited geographic focus, political and economic instability, and relatively illiquid markets. Income (bond) funds are subject to interest rate risk which is the risk that debt securities in a fund's portfolio will decline in value because of increases in market interest rates. There is no guarantee that results or savings will be achieved if you should select Envestnet | PMC to provide services to you. The experience described does not represent all recommendations made to clients nor does it represent the experience of all clients. The reader should not assume that an investment in any securities or services outlined was or will be profitable or favorable. Neither Envestnet, Envestnet | PMC™ nor its representatives render tax, accounting or legal advice. Any tax statements contained herein are not intended or written to be used, and cannot be used, for the purpose of avoiding U.S. federal, state, or local tax penalties. Taxpayers should always seek advice based on their own particular circumstances from an independent tax advisor. Diversification does not guarantee a profit or guarantee protection against losses. Advisors should always conduct their own research and due diligence on investment products and the product managers prior to offering or making a recommendation to a client. FOR ONE-ON-ONE USE WITH A CLIENT'S FINANCIAL ADVISOR ONLY. ©2024 Envestnet, Inc. All rights reserved. 20231215-3266379 █████████████████ Ì2000015IIXÎ

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