As the S&P 500 continues its bumpy ride through the Iran war, asset managers are promoting an investing strategy that might help advisors capitalize on market swings and stock dispersion—tax-managed long-short equities. 

The strategy involves placing bets on both long equity positions and shorting underperforming stocks, potentially limiting losses during down markets and providing tax benefits for investors who need to offset capital gains elsewhere in their portfolio. However, investing in long-short equities is not without its downsides, including higher-than-average fees, lack of participation in market upside, the added risk of using leverage for short positions and potential for tracking errors that rise with market volatility.