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How is this for tax efficiency? Is rebalancing a taxable event? Or can you rebalance without selling by just redirecting new contributions to the underrepresented issues? Over time a buy-and-hold strategy with etfs gives a large compounding bonus since taxes are deferred.

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We're exploring several rebalancing models at the moment (calendar rebalancing, constant proportion rebalancing, as well as only rebalancing with new contributions), and trying to understand which folks are more interested in. Which would you be most interested in?

Definitely want to mitigate tax burden. Additionally, the direct indexing model does allow for more flexibility around loss-harvesting.

so re-balancing IS a taxable event right?

It CAN be. It depends how you rebalance.

If your target is 50/50 and one stock goes up, you can either sell that stock or buy more of the other one. Only one of those models is a taxable event.

Only rebalancing by using new contributions would be preferred. My use case is re-creating the s and p 500 exclusive of some issues and with regular contributions for retirement.

Nice, glad to hear it. We lean new contributions as well.

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