Background: over a decade ago I invested a sizeable chunk of my savings into a big tech company that has done well over the intervening years. Now I find myself in a position where a large percentage of my portfolio is in this single security and I'm looking to diversify.
I have been told that enhanced direct indexing is a good option for unwinding a concentrated position. I'm a novice here but if I understand it correctly, for a non-trivial fee, a management firm will use my concentrated position as leverage to buy long and short positions and use tax loss harvesting to offset capital gains, effectively diversifying while deferring the large taxable event.
Are there big inherent risks I'm not aware of? Are there other options I should consider? I recognize there's a real risk by having nearly half of my portfolio in a single security but I don't want to make a mistake and take an even greater risk trying to unwind it.
Thanks!