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Our client accounts are held in custody by U.S. Bank, and we absorb the substantial cost. The assets held for you by our custodian are legally yours: that might seem obvious, but it is not the case for assets held in a margin account by a brokerage firm. You also benefit from lower brokerage commissions (which result from trading in large blocks that include dozens of clients at a time); and you’ll be pleased to receive the comprehensive tax report (individually-reviewed by a U.S. Bank tax expert) that the bank provides at the end of each year.
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First
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$ 500,000*
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1.1%
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Next
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$ 1,000,000
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0.80%
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Above
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$ 1,500,000
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1/2 of 1%
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*The minimum portfolio is $1,500,000.
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For example, an account with a market value of $2,100,000 would have a fee that works out to 0.79%. The fee on the first $500,000 is 1.1% per annum, regardless of the size of the relationship. A family of accounts can be combined for fee purposes, thus reducing fees for each of the members of the family.
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Fees are collected in twelve installments, at the end of each month. The minimum portfolio is $1,500,000. There is no termination fee, but we expect our clients to join us as long-term investors. Two years is a reasonable trial period for client and manager to evaluate performance, service, and compatibility.
It’s Your Money
Hidden Costs: a primer on fees and expenses in the investment management and mutual fund industries.
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