Linden Thomas & Company

Why Institutional Indexing for Affluent Investors?

2021 LTC Top Index Results

Why Institutional Indexing for Our Affluent Investors?

Since the 1970s when the first index fund was created, both small and large investors have flocked to pooled index funds because of the ease and popularity.

When asked why, many would say it is due to the perceived low cost or the failure of the retail investment advisor’s ability to add value.

While pooled index funds may be a viable option for small investors, affluent investors with over $1 million qualify for institutional investing. The Linden Thomas & Company’s institutional earnings focused index gives investors enhanced results through three key academic disciplines. These three focuses are earnings quality, direct ownership of holdings, and minimizing cost. Our earnings focus helps avoid failing companies often found in market-cap index funds. Through direct equity ownership, it means our investors avoid herding impact often found in pooled funds due to small investor's poor behaviors. Hidden trading costs and high advisor costs are avoided as well. Linden Thomas & Company provides affluent investors with enhanced long-term results through high quality securities, total control, and transparency all with less of a cost.

Each of the Linden Thomas & Company portfolios give clients access to our earnings-focus institutional indexing as well as some of the industry's top institutional equity managers. Our yield-focus fixed-income portfolios are built from the ground up and tailored around each clients' needs. The benefit of our approach is clients gain a team of professionals with decades of industry experience and proven results.

Linden Thomas – 31 National Recognitions

How We Compare with Cumulative Results

Retail investment products often carry hidden costs and other disadvantages which impact investor results. Institutional Direct alleviates the need to pay high advisor fees and invest in products like mutual funds. This helps reduce investor costs by hiring the asset manager directly, which takes away hidden fees and pricing disadvantages of pooled investment products. Linden Thomas & Company has developed an interactive tool to help illustrate Institutional Indexing vs. a variety of retail mutual funds.

Use the Interactive Chart

To get started, select any one of the Linden Thomas & Company Institutional Index funds tabs above the chart. Once selected, compare the fund with the retail index fund shown. Switch tabs to see different retail funds. Hover over the points on the graph to see the % return for that fund and year. For your convenience, we've started each fund with a $2 million investment and shown the growth over the years provided.

Step #1: SELECT one of our index funds below. Step #2: SELECT a retail fund and compare.

Flaws of Retail Mutual Funds

Failed Mutual Funds

As the retail investment firms have grown, there has been a push by the retail investment advisor to place investors in pooled index funds. This is often associated with investors paying an advisor fee along with additional hidden costs of mutual funds. Many of the index funds want investors to believe these funds are benefiting the client due to the low expense ratios, but what is never discussed is the hidden costs and inefficiencies which impact results.

    • Trading costs
    • Spreads on trades
    • High advisor cost
    • Small investor herding impact
    • Phantom taxes
    • Pricing disadvantages

All these items (while seldom discussed) can be found in not only index funds but other retail investment products as well. This is why Linden Thomas & Company set out to develop an institutional approach with a focus on client results through building efficient portfolios and our institutional indexes.

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Linden Thomas & Company

31 National Recognitions and Counting...

Barron's 2022
Barrons 2021
The Business Journals 2021
The Business Journals 2021
Financial Times 2020
Financial Times 2018
Barrons 2018
Barrons 2017
Charlotte Magazine 2017
Financial Times 2017
Barrons 2017
Forbes 2016
Barrons 2016
Financial Times 2016
Barrons 2015
Barrons 2014
Forbes 2013
Barrons 2013
The Business Journals 2012
Barons 2012
Wealth Management 2011
Forbes 2011
Barrons 2011
Wealth Management 2012
Forbes 2010
Forbes 2010
Barrons 2010
Forbes 2009
Barrons 2009
Charlotte Mg 2008
Forbes 2008

LEGAL DISCLAIMERS: Securities services offered through Linden Thomas & Company Securities, LLC; member FINRA/SIPC. Advisory services offered through Linden Thomas Advisory Services, LLC. Linden Thomas & Company Securities, LLC and Linden Thomas Advisory Services, LLC are affiliated entities.

Investing is subject to a high degree of investment risk, including the possible loss of the entire amount of an investment. An investor should carefully read and review all information provided by Linden Thomas Advisory Services, LLC ("Linden Thomas & Company"), including, the Form ADV, Part 2A brochure and all supplements thereto, before making an investment.

The information contained herein reflects the opinions and projections of Linden Thomas & Company as of the date of publication, which are subject to change without notice at any time subsequent to the date of issue. Linden Thomas & Company does not represent that any opinion or projection will be realized. All information provided is for informational purposes only and should not be deemed as investment advice or a recommendation to purchase or sell any specific security. While the information presented herein is believed to be reliable, no representation or warranty is made concerning the accuracy of any data presented. Prospective clients should not treat these materials as advice in relation to legal, taxation, or investment matters.

Statements herein that reflect projections or expectations of future financial or economic performance of investments, including investments in the Linden Thomas & Company Indexes (the "Index"), are forward-looking statements. Such "forward-looking" statements are based on various assumptions, which assumptions may not prove to be correct. Accordingly, there can be no assurance that such assumptions and statements will accurately predict future events or the Fund's actual performance. No representation or warranty can be given that the estimates, opinions or assumptions made herein will prove to be accurate. Any projections and forward-looking statements included herein should be considered speculative and are qualified in their entirety by the information and risks disclosed in the confidential offering document. Actual results for any period may or may not approximate such forward-looking statements. Prospective investors are advised to consult with their own independent tax and business advisors concerning the validity and reasonableness of the factual, accounting and tax assumptions. No representations or warranties whatsoever are made by Linden Thomas & Company or any other person or entity as to the future profitability of the Index or the results of making an investment based on the Index. Past performance is not a guarantee of future results.

The Index performance results presented do not represent the results of an actual client and investment, but were achieved by means of the retroactive application of the rules of the Index to a portfolio. This portfolio is hypothetical only and may include estimates, projections, and forward looking and back tested projections. The trades during the back test were not actually executed, and the back tested results are not necessarily indicative of the performance of the Index. No representation is being made that any account will or is likely to achieve profits or losses similar to those shown.

Hypothetical back tested performance results have many inherent limitations, some of which are described herein. In fact, there are frequently sharp differences between hypothetical back tested performance results and the actual results subsequently achieved by any particular trading program. One of the limitations of hypothetical back tested performance results is that they are generally designed with the benefit of hindsight. In addition, hypothetical trading does not involve financial risk, and no hypothetical trading record can completely account for the impact of financial risk in actual trading. For example, the ability to withstand losses or to adhere to a particular trading program in spite of trading losses are material points which can also adversely affect actual trading results. There are numerous other factors related to the markets in general or to the implementation of any specific trading program which cannot be fully accounted for in the preparation of hypothetical performance results and all of which can adversely affect actual trading results; including, but not limited to, changes in the investment landscape and unexpected changes in the market or economic landscape. Performance posted by system providers may have had little or no experience in trading actual accounts for itself or for customers. Because there are no actual trading results to compare to the hypothetical performance results, clients should be particularly wary of placing undue reliance on these hypothetical performance results. There can be no assurance that these, or comparable results, will be achieved.

Various indices, including, but not limited to the S&P 500 Index and the Russell 2000 Index (each a "Third-party Index") are unmanaged indices of securities that are used as a general measure of market performance, and their performance is not reflective of the performance of any specific investment. The Third-party Index comparisons are provided for informational purposes only and should not be used as the basis for making an investment decision. Further, the performance of the Index and each Third-party Index may not be comparable. There may be significant differences between the Index and each Third-party Index, including, but not limited to, risk profile, liquidity, volatility and asset comparison. The performance shown for each Third-party Index reflects no deduction for client withdrawals, fees or expenses. Accordingly, comparisons between the Index and each Third-party Index may be of limited use. Investments cannot be made directly into the Index or any Third-party Index.

By accepting this information, the recipient agrees that it will not divulge any information contained herein to any other party. This presentation and its contents are confidential and proprietary information of Linden Thomas & Company and any reproduction of this information, in whole or in part, without the prior written consent of Linden Thomas & Company is prohibited.