Breaking Tradition

to Build a Better Index

Breaking from Wall Street’s market-cap approach, Indexperts was founded to build a more efficient index centered on earnings quality, direct ownership, and minimized costs.

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The Key Factors in Building a More Efficient, Results-Focused Index

Quality of Holdings

Helps enhance upside results, minimize downside losses, and support faster recovery.

Direct Ownership

Benefits Indexperts Direct and Indexperts Corporate clients by giving disciplined investors full control, rather than pooling them with others who may not be as disciplined.

Minimizing Cost

Supports all three factors by preserving more capital during up markets, reducing the drag during down markets, and keeping more assets available for recovery.

Each of these characteristics—at the core of Indexperts' earnings-focused indexes—adds a critical piece to empowering long-term compounding for investors.

How Tradition Failed!

What They Don’t Tell You

Failure in Passive Indexes – Companies Are Not Selected for Quality

Companies are added and removed based on size, not quality. This means companies are often removed only after they’ve declined significantly—by then, it’s too late.

Small Investor Herding Impact

Because investors are pooled, those with different needs are lumped together. Each investor is affected by the behavior of others. When one sells, it creates trading activity that leads to higher trading costs, tax consequences, spreads on trades, and added volatility for everyone.

Hidden Fees and High Advisor Costs

Many investors assume that the expense ratio or advisor fee includes all costs—but it doesn't.

Mutual funds incur trading costs and are also exposed to bid-ask spreads. When you add up advisor fees, fund expense ratios, trading costs, and spreads on trades, the total cost can significantly erode portfolio results.

How Do Traditional Indexing and Investment Advisors Fall Short?

Many investors in retail investment firms operate in the space of questions and doubts. Not only are the portfolios often poorly constructed, but investors can be left with little understanding of how to navigate different market environments. Indexperts set out to build an investor learning center: Indexopedia. Indexopedia is exclusive to Indexperts investors and gives our clients and their children access to 37 years of market and investment insights.

Third-Party Funds

Many of the industry's investment advisors do not own their broker-dealer, nor are they licensed to be a money manager. This often means they rely on third-party funds and model portfolios.

Hidden Fund Costs

While many investment fund companies claim to have low expenses, they often fail to discuss the other costs of pooled funds like internal trading costs, internal trade spreads, and pass-through taxes.

Lack of Quality

Much of the retail investment industry is built around putting clients in market-cap index funds. A market-cap index fund is constructed based on the size of the company, not the quality.

Pooled Ownership

Many investors who hold popular funds are unaware of small-investor herding impacts. The movement of investors moving into and out of the fund on a daily basis creates increased trading costs and capital gains.

Fixed Income Pricing Disadvantages

Investors in bond funds are subject to low yielding bonds that when purchased had a good yield. Because the bonds are pooled with no direct ownership, the fund manager can’t buy the bonds based on the individual’s net-income needs.

Middlemen

Retail investment advisors are seldom the only one getting paid. Fund companies make money from the expense ratio. Transactional costs are paid to brokerages and clearing firms.

Ownership & Control

Most retail advisors do not own the broker-dealer of the firm they work for. Advisors put their name on the door, but without full ownership of the broker-dealer they don’t have full control of costs or management. This is why Linden Thomas & Co. set out over a decade ago to build and own both the broker-dealer and investment advisor firm.

Education & Insight

Quality Over Junk – A Better Approach

Explore Indexperts’ Earnings-Focused Indexes

3 Types of Indexperts Investors:

Corporate

Generally for institutions with $50 million to over $100 million in assets

These institutions desire to tailor both equity and fixed income strategies through their advisors or the Indexperts team. Development takes place by building a custom index—drilled down to the actual holdings and sectors. This is where our team of experts, alongside the industry's best technology, builds the index together—ensuring the strategy is directly aligned with both investor needs and desired results.

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Advice

Expert advice & institutional indexes for investors with $500,000 to $50 million

Indexperts Advice allows affluent investors direct access to many of Indexperts' institutional indexes, which focus on earnings quality and direct ownership tailored specifically to investor needs. Portfolios are managed individually—not through pooled funds—across targeted sectors. There are no high advisor fees and no hidden costs. Both the holdings and the costs are fully transparent. Because stocks and bonds are bought, managed, and held in the investor's name, this structure empowers investors to manage taxes more effectively through gifting or tax-loss harvesting.

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ETFs

For investors of any size who seek portfolio efficiency

Indexperts ETFs allow investors with fewer assets to access Indexperts' earnings-focused discipline—either directly or through an investment advisor. Just like our institutional direct indexes, Indexperts ETFs use the same earnings-focused approach. This gives the next generation of affluent investors access to high-quality companies, even with less investable capital. Investors can purchase the ETFs directly through an investment firm or via their advisor.

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10 Reasons Affluent Investors Choose Indexperts Institutional Direct

How to Invest

Since the creation of the first passive index fund in the 1970s, very little has changed. Most index funds remain passive and pooled, meaning investors are grouped together in a single vehicle—and the holdings are not selected based on the quality of the companies.

This outdated structure leads to two critical shortfalls that Indexperts set out to improve:
A lack of focus on earnings quality and No direct ownership or control for the investor.

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Indexperts Introduces Indexopedia - The digital learning center for Indexperts clients

Indexopedia is the education and insights center for Indexperts clients, created to empower investors with the knowledge and discipline needed to navigate all types of markets up to and through retirement.

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6 Qualities of an Efficient Portfolio

How do you know if your portfolio is efficient and what impact it has on results?

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More Guides Available Exclusively to Indexperts Clients

Example Guide 1 of 6

3 Factors of Compounding: Upside, Downside, and Recovery

When investors think about building wealth, they often consider up-market growth, or how much they will achieve if the markets rise. When markets are up, one of the first things investors do is see what their returns are for the day, month, or year. While a rally is always welcome, long-term success of a portfolio isn’t built on short rallies in certain sectors. History has proven time and again that rallies in sectors come and go.

Example Guide 2 of 6

How Can I Teach my Kids How to Save and Invest Wisely?

Teaching children the importance of saving and investing is a valuable life lesson that can set them up for financial success. By fostering good habits early, parents can instill a mindset that balances responsibility with long-term thinking.

Example Guide 3 of 6

Institutional Indexing is Built for the Individual, Retail Indexing is Built for the Institution

Pooled index funds have become very popular over the last three decades. This is due in part to the ease of access it provides small investors who want a diversified basket of stocks for a low initial investment. While pooled index funds and ETFs (exchange-traded-funds) may be appropriate for small investors, there are a few considerations affluent investors should keep in mind before using these products.

Example Guide 4 of 6

Proof that Market Timing Doesn’t Work!

Trying to time the stock market is like trying to catch lightning in a bottle – tempting, but statistically doomed to fail. While the concept of “buy low, sell high” seems intuitive, the reality is that predicting market tops and bottoms with any consistency is virtually impossible, even for professionals. In this article, we’ll break down why market timing doesn’t work, using real-world examples, data from major recoveries, and insights from investor behavior research.

Example Guide 5 of 6

Waiting for Recovery Instead of Chasing Returns

Even the most well-constructed portfolio will suffer if the investor makes bad choices. It is easy to stay the course when markets are steady, but many investors lose their nerve during periods of volatility or chase returns when they feel they’re missing out. If your strategy was constructed thoughtfully, with a focus on quality, direct ownership, and spreading risk, then you should think twice before making changes due to recent fluctuations.

Example Guide 6 of 6

What If You Miss the Best Part of the Recovery?

Investing in the stock market is often compared to riding a roller coaster: there are thrilling highs and gut-wrenching lows. The periods following market downturns–when recoveries begin–are crucial for long-term investors. Missing the initial phase of a market recovery can have significant implications for overall portfolio performance.