5. FEES & COMPENSATION
Investment Management Fees
Fees charged by Dorchester are outlined in the client’s written Investment Management
Agreement. Fees are negotiable and will differ amongst clients based on a number of
factors, including, but not limited to portfolio size, amount of assets held in related
accounts, and investment policy. Fees are billed quarterly in arrears, based on the market
value of your assets under our management (including cash and equivalent and accrued
but unpaid interest, accrued dividends, and securities purchased on margin). For certain
clients, we charge an advisory fee for services provided to the held-away accounts
mentioned above in Item 4, just as we do with client accounts held at our primary
custodians(s). The specific fee schedule charged by us is provided in the client’s investment
advisory agreement with us.
Clients may elect to be invoiced directly or can authorize Dorchester to debit fees directly
from their managed account. Accounts initiated or terminated during a calendar quarter
will be charged a prorated fee. Fees vary and are usually at or lower than 1.25%. In certain
circumstances, fees may be waived. Once a fee schedule has been signed by a client, it
cannot be changed without prior written notice to the client.
Dorchester’s fees are exclusive of brokerage commissions, transaction fees, and other
related costs and expenses which shall be incurred by the client. Clients may incur certain
charges imposed by custodians or brokers such as wire transfer fees and other fees and
taxes on brokerage accounts and securities transactions. Mutual funds (that may have
been transferred in and maintained within the portfolio) and exchange traded funds also
charge internal management fees, which are disclosed in the respective fund’s Trust
Agreement. Such charges, fees, and commissions are exclusive of and in addition to
Dorchester’s investment management fees. Dorchester does not accept typical mutual
fund remuneration such as sales charges (whether front load or DSCs) or trailer fees.
Upon termination of management services, any partial period unbilled will be charged
(note: all fees are in arrears rather than in advance).
Custodian Fees
Dorchester does not hold cash or securities on behalf of its clients. Securities and cash are
held at a custodial agent, usually a major trust company, bank or broker. Depending on
the client’s custodian and its services, a custody fee may be charged by the custodian.
Dorchester does not receive any part of the custodian fees.
Brokerage & Transaction Costs
In the course of managing portfolios, Dorchester will place orders to buy and sell securities
with investment dealers involving brokerage costs or commissions to the client. In deciding
where to place these orders, Dorchester will take into consideration the cost to the client
of executing the trade and the broker’s ability to execute the trade in a timely manner at
the best price. Dorchester is not affiliated with any such investment dealer/broker and all
transactions are conducted at arm’s length. In connection with client accounts held at
custodians, a client may incur custodian fees and/or transaction charges, wire transfer and
electronic fund fees plus applicable taxes. Such charges are exclusive of and in addition to
the Dorchester fees and Dorchester will not receive any portion of these costs.