Gain limiter

When rolling over qualified assets, rebalancing is simple since there are no tax implications. However, non-qualified accounts with highly appreciated assets can be more challenging, especially when those assets don’t align with the target strategy.

The Gain limiter feature makes this complicated process easy and automatic! With a single click, Symplany can hold onto highly appreciated positions your clients transfer, preventing unnecessary gains from being realized. External holdings are then incorporated into the overall strategy and will only be sold strategically during a withdrawal.

Key Features of Gain limiter:

• Applies only to positions with unrealized gains in non-qualified accounts.
• Automatically sells a position if it drops to an unrealized loss.
• Helps minimize taxes for clients while maintaining investment flexibility.
• Intelligently incorporates non-strategy holdings into the target model.
• When Symplany needs to raise cash (e.g. to fix a debit or cover a withdrawal), a holding may be sold—even if it has a gain.

Use Cases:

1. New Account Transfers
   • Symplany’s default logic sells non-aligned holdings, but enabling Gain limiter ensures that transferred positions with unrealized gains are retained.
   • Forgot to enable it? Any trade over $1,000 in gains goes to a queue for your review before execution.
2. Switching / Updating Strategies
   • When transitioning between strategies, Gain limiter prevent the realization of gains by holding appreciated positions.
   • You can customize specific funds to hold or sell by enabling/disabling the feature for each position.
3. Working Around Non-Strategy Positions
   • Symplany incorporates non-strategy holdings into the target model, using available cash to buy into the model, minimizing drift and maintaining the client’s strategy.
4. Withdrawals
   • The only situation where Symplany may sell a holding (even if Gain limiter is enabled) is when Symplany needs to raise cash (e.g. to fix a debit or cover a withdrawal).
   • Symplany will sell whatever holdings are most overweight, including holdings utilizing the Gain limiter feature.

Summary:

• Gain limiter is not enabled by default. Turn this feature on before funds are transferred to avoid automatic selling.
• Any trades triggering gains over $1,000 get paused and require your approval before processing.
• Symplany will only hold positions with unrealized gains; positions with losses are automatically sold.
• Once Gain limiter is disabled, the entire position will be sold (no partial sales).

Common questions:

What happens during a withdrawal when Gain limiter is on?

The only situation where Symplany may sell a holding (even if Gain limiter is enabled) is when Symplany needs to raise cash (e.g. to fix a debit or cover a withdrawal). Symplany will sell whatever holdings are most overweight, including holdings utilizing the gain limiter feature.

Is Gain limiter available in qualified accounts?

No. Use the elective locks feature if you want to hold a position in a qualified account.

Can I use Gain limiter to hold individual equities?

Yes.

If a holding currently has an unrealized gain, can I continue to keep it if it declines to an unrealized loss?

No, if the fund isn't on your target strategy and has a loss it will be sold. Use the elective locks feature if you want to hold a position at a loss.

Can I turn this feature on in all of my NQ accounts?

Yes, but it can only be turned on one account at a time.

Can I keep a fund, but gradually sell out of it over time?

No, it's all-or-nothing.

When I'm creating a new account, can I turn on this feature and have it apply to future holdings that come in?

Yes.

What if I forget to turn on the Gain limiter feature? What happens to positions that come over at a gain?

Any trade over $1,000 in gains goes to a queue for your review before execution. If gains are under $1,000, trades will go through.