Fees and Compensation — Form ADV Part 2A (3/29/2016)
[Brochure]
Fees and Compensation
Fees are paid quarterly in arrears based on a complete quarter of investment activity according
to the following annual schedule:
0.75% of first $15,000,000
0.65% of next $10,000,000
0.60% on amounts above $25,000,000
Fees are initiated by the Sub-Advisor. The Fees are processed via the Custodian and directly
debited from Customer’s Account on a quarterly basis in arrears.
Performance-based fees and Side-by-Side Management
The Adviser receives no performance based fees. Its only remuneration is what is paid by its
clients according to the above schedule.
Account Minimums and Types of Clients — Form ADV Part 2A (3/29/2016)
[Brochure]
Types of Clients
The Adviser currently has four clients – two corporations and two Partnerships managed by the
Larkspur Family Office. Large institutions, endowments, family offices and corporation are the
general type of client that would best use the approach of the Adviser, either as a hedge fund
alternative or core portfolio. The Adviser has established a partnership, Coppice Fund I, to
allow for minimum balances of $25,000 in a comingled portfolio.
Methods of Analysis, Investment Strategies and Risk of Loss
The method of analysis consists of using historical returns of popular benchmarks and passively
managed mutual funds to construct portfolios that provide the best historical tradeoff between
average return and standard deviation of return for each risk factor. Using the historical returns
of these portfolios, we consolidate them to have the best correlation with a widely followed
hedge fund benchmark subject to allocating at least 10%, but no more than 30% to any risk
factor.
Clients are advised that investing involves the risk of loss. Risk of any individual asset is based
on how it impacts the risk of the portfolio and not as a standalone investment. Based on the
historical performance of the portfolio and benchmarks consolidated to reflect its risk characters
for periods prior to March 31, 2006, it is reasonable to expect a loss greater than 4% in one out
of every six years.
Frequency Trading of Securities
Trading securities is infrequent. Portfolios are monitored both monthly and quarterly and
rebalanced back to established commitments as necessary.
Material Risks of Particular Securities
Client portfolios are constructed using well-diversified portfolios consisting of passively
managed mutual funds, ETFs and U.S. Treasury portfolios. The mutual funds and ETFs are
selected based on costs and how closely its characteristics mirror a particular market or asset
class. Consequently, the risk of any individual security is minimal.