Fisher Investments on Some Virtues of Holding Individual Stocks

Tax benefits: High net worth individuals have the potential to receive significant benefits from direct ownership, particularly from a tax perspective. Fisher Investments believes that owning individual stocks can enable the investor to use capital losses to offset capital gains. Index funds don’t opportunistically pass capital losses through to shareholders.

Cost-effective ownership: Fisher Investments believes that owning stocks is the cheapest form of equity ownership—no middleman or extraneous management fees.

Direct ownership: Index fund investors do not directly own shares in a company’s stock. Instead, they only offer ownership in a fund that owns constituents of an index. Stocks represent a share of direct ownership in a company, which guarantees certain shareholder rights and benefits.