A major exchange-traded fund provider is getting ready to launch a fund designed to ease investors' tax burdens from a record-setting stock market.

Even though ETFs are considered more tax efficient than mutual funds, Astoria Portfolio Advisors plans to launch the Astoria U.S. Enhanced Core Equity ETF (LCOR) in October. The fund uses a tax-mitigation strategy that's known as an exchange or conversion under Section 351 of the tax code.

When a stock has a huge run-up, investors may end up overconcentrated in that name, putting them on the hook for large capital gains taxes if they try to sell down the position. With a Section 351 exchange, investors may be able to reallocate some of that position without triggering capital gains taxes. They transfer those assets to a newly created ETF

See Full Page