At a glance
- The change narrows the set of RIA client accounts that can use the strategy at all, and it applies to a program advisors have been able to open for accounts roughly a tenth that size.
- Schwab had earlier limited how much of an RIA's assets could go into the accounts, so advisors using the program were already working under a cap on client allocations before the minimum moved.
- Advisors who had been using the strategy for accounts between $1 million and $10 million can no longer open it for those clients.
Schwab has raised the minimum account size for its tax-aware long-short program to $10 million, up from $1 million. The change narrows the set of RIA client accounts that can use the strategy at all, and it applies to a program advisors have been able to open for accounts roughly a tenth that size.
The accounts represented $60.7 billion of Schwab's $187.9 billion in client margin loans at the end of September, about a third of that book. Schwab had earlier limited how much of an RIA's assets could go into the accounts, so advisors using the program were already working under a cap on client allocations before the minimum moved.
What changes at the desk
Advisors who had been using the strategy for accounts between $1 million and $10 million can no longer open it for those clients. Those accounts need another route to long-short exposure or tax-loss harvesting, and any advisor who had built a standard offering around the old $1 million entry point now has to re-segment the book around the new floor. Accounts above $10 million keep access, still subject to the asset-level cap Schwab imposed earlier.
Reported by The Advisor's Note desk from Internal newsroom graph query results (Schwab tax-aware long-short minimum; Schwab client margin loans). Published . Corrections