SEVERAL YEARS OF STRONG MARKET GAINS have made tax efficiency an increasingly influential—and often undervalued—factor in a portfolio’s overall performance. Today, tax considerations come into play in and out of filing season, and call for a more deliberate approach to asset choice, how the asset is purchased and where it is held.

“Tax efficiency isn’t a single strategy—it’s a mindset,” says Chris Hyzy, Chief Investment Officer for Merrill and Bank of America Private Bank. Investors who focus on after‑tax outcomes throughout the portfolio construction lifecycle may be better positioned to reduce tax drag over time.

One commonly used strategy, called tax‑loss harvesting, involves intentionally realizing investment losses to help offset taxable gains. When implemented systematically and alongside broader portfolio decisions—such as what you own and where you keep it—harvesting losses can help investors manage taxes while maintaining their long‑term strategy.

But in a market environment with a recent history of positive returns, are there other ways to improve after-tax outcomes?

In the video above, Hyzy is joined by two members of the Chief Investment Office (CIO) team, Joe Curtin, head of Portfolio Management, and Mitch Drossman, head of CIO National Wealth Strategies. The three discuss how building strategies into your portfolio can help support predictable after-tax results.  “Tax policy and markets will continue to change,” said Drossman. “Portfolios built with intention and flexibility are better equipped to adapt.” For investors, starting with the most tax‑efficient assets and vehicles, and placing them in the most appropriate accounts, remains foundational—especially for higher‑taxed investors.

“When all else is equal, the more tax‑efficient option should be the default,” said Curtin. “Any deviation needs a clear reason, because taxes could quietly compound just like potential returns do.”

Watch the full conversation to hear how asset location, tax‑aware investment vehicles and disciplined loss harvesting can work together to help reduce tax liability - and why coordination across portfolio management, wealth structuring, and tax planning is increasingly important.

Go deeper with the article, “How should taxes factor into your investment decisions?” And for more timely market insights from the CIO, tune in regularly to the Market Update audiocast series.