Frec

Frec is a tax-aware investing platform for direct indexing, with classic index tracking, long short strategies, and diversified concentrated stock positions.

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What Frec is

Frec is a tax-aware investing platform centered on direct indexing. It lets investors buy exposure to market indices through customizable portfolios while aiming to reduce capital gains through automated tax-loss harvesting.

The product line includes classic direct indexing, long short direct indexing, Diversify for concentrated stock positions, portfolio line of credit, Trade, and Treasury. The site emphasizes low-cost access, self-directed investing, and account setup without a human advisor for the direct indexing strategies.

Core capabilities

Tax-aware direct indexing

Automate tax-loss harvesting while investing in market indices, with the goal of reducing capital gains taxes over time.

Multi-index portfolio management

Build a portfolio from multiple indices and keep allocations aligned with your investment plan instead of holding a single tracked index.

Use existing stocks as a starting point

Transfer existing brokerage stocks into Frec and use them to fund a direct index, including an auto-conversion flow that sells them tax-efficiently and reinvests the proceeds.

Long short strategy options

Choose long short structures and factor tilts to seek higher potential pre-tax returns while still tracking a benchmark index.

Diversify concentrated holdings

Transition concentrated stock positions into a diversified index over time with a minimal-tax approach and day-one risk reduction.

Tax savings tracking

Track how much tax savings may add to portfolio value over time, based on the product’s internal projections and simulations.

Common use cases

Tax-aware market investing
Investors who want market exposure but also want to automate tax-loss harvesting can use Frec’s classic direct indexing approach to pursue tax-aware returns without managing the process manually.
Diversifying concentrated stock
People with concentrated stock positions can use Frec Diversify to transition holdings into a more diversified index over time while trying to limit the tax impact of the move.
Long short benchmark tracking
Investors looking for higher-risk, higher-complexity index strategies can use long short direct indexing and factor tilts to seek potential excess returns while still benchmarking against an index.
Using existing holdings
Users who already hold stocks at another brokerage can transfer those positions into Frec and use them as a starting point for a direct index portfolio.
Managing multiple indices
Investors who want to manage several indices in one place can build a portfolio allocation and keep accounts balanced to match an investment plan.

Pros and Cons

Pros

Automated tax-loss harvesting is built into the investing workflow.
Classic direct indexing starts at a low annual fee of 0.09%.
The platform supports multiple account types, including individual, joint, trust, and business accounts.
Users can choose between classic, long short, and diversification-oriented strategies depending on their goal.
Funds are held in the investor's name at third-party Apex Clearing.

Cons

Minimum investments are relatively high for some strategies, especially long short and Diversify.
Some strategies include financing costs in addition to annual fees.
The site does not provide a full public breakdown of onboarding, custodian setup, or all supported account features on the pages reviewed.

FAQ

How do I get started with Frec?

Frec says you can create an account in minutes and supports individual, joint, trust, and business accounts. The site also offers a Schedule a call option if you want help from the team.

Who is Frec designed for?

The site positions Frec for investors who want direct indexing without a human advisor, including people using classic direct indexing, concentrated-stock diversification, or long short strategies. It also notes that minimums vary by product, ranging from $20k-$50k for classic direct indexing and $100k-$500k for long short and Diversify strategies.

What can I do inside a Frec account?

Frec says it supports multiple direct indices in one portfolio and lets you keep accounts balanced according to an investment plan. The site also says you can track estimated tax savings over time.

How does pricing work?

The pricing page shows annual fees that vary by strategy: classic direct indexing starts at 0.09%, long short direct indexing starts at 0.50%, and Diversify starts at 0.60%. Some strategies also include post-tax financing costs.

How are assets held and protected?

Frec says your funds are held in your name at third-party Apex Clearing, and that your assets remain fully accessible even if something happens to Frec.

Quick Facts

Category: Tax-aware investing platform
Core product: Direct indexing
Pricing: Classic direct indexing starts at 0.09% annually; other strategies have higher fees and may include financing costs
Account types: Individual, joint, trust, and business
Custodian: Third-party Apex Clearing
Website: frec.com