Item 5 – Fees and Compensation
Overview:
The fees and other charges that you pay for advisory programs or services that we offer will depend on several
different factors. The fees for advisory programs are generally based on the “Assets Under Management.” This
means that the account is charged a fee based on the account balance as of a certain date. The Financial Planning
and Consulting Services program allows for the charging of flat or hourly fees. These fees are negotiable between
you and the IAR offering the service.
Most of our programs that require an account charge an advisory fee billed quarterly, in advance or in arrears (as
determined at the time the account is opened), at the beginning of each calendar quarter based upon the value
(market value or fair market value in the absence of market value), of the client's account at the end of the previous
quarter.
Advisory fees are generally deducted from the account, and will be in accordance with the client authorization in the
Client Services Agreement. The account statements you receive from the custodian will reflect the deduction of
these fees. Fees are deducted from the client account in the month following quarter end. For some programs, fees
may be paid to us by check, as outlined in the agreement. In this case, we will send an invoice to you for the fees
owed.
Some assets in your managed account may not be included in the calculation of your advisory fee. For example,
assets that you recently paid a commission on may be exempt from this advisory fee. With approval from our
management, we allow you to “hold” the asset in your advisory account, but this asset would not be charged an
advisory fee. If your account is billed based on assets under management, the advisory fee is generally split between
an administrative (or platform) fee and a management fee.
GAMA CHOICE - INDIVIDUAL AND MODEL PORTFOLIO MANAGEMENT FEES
Annual fees for portfolio management generally range from 1.50% to 2.50% and will be charged as a percentage of
assets under management.
Fees may be charged on a linear or tiered billing schedule. For a linear billing schedule, the account is billed a flat-
rate fee based on the value of assets under management. For a tiered billing schedule, the account is billed a
different percentage rate at each tiered account value level. For example, with a tiered billing schedule, the fee on
the first $250,000 in assets will be different than the fee on the next $250,000. The percentage fee for each
progressive tier will not be greater than previous tier. The percentage based fee for your account will never be
greater than the maximum annual fee allowed by the program.
Below are the maximum fees for both the linear and tiered billing schedules:
Account Size Maximum Annual Fee
$50,000 - $499,999 2.50%
$500,000 - $749,999 2.25%
$750,000 - $999,999 2.00%
$1,000,000 - $1,999,999 1.75%
$2,000,000 + 1.50%
The maximum percentage fees above are after inclusion of an applicable Administrative Fee. Your IAR has
discretion to negotiate alternative fees on a client-by-client basis. Facts regarding your needs will be considered in
determining the fee schedule. These include the complexity of your portfolio and circumstances, assets to be placed
under management, net worth, anticipated future additional assets, related accounts, portfolio style, account
composition, and reports requested or required by you, among other factors. The specific annual fee schedule will be
identified in the contract between you and your IAR.
We may group certain related client accounts for the purposes of achieving the minimum account size requirements
and determining the annualized fee. Discounts may also be offered to associated persons of our firm and their family
members.
Fees will be billed quarterly, in advance or in arrears (as determined at the time the account is opened), at the
beginning of each calendar quarter based upon the value (market value or fair market value in the absence of market
value), of the client's account at the end of the previous quarter. Fees will be deducted from the account in
accordance with the client authorization in the Client Services Agreement.
GAMA Choice program accounts are also charged transaction fees to cover brokerage execution services. These
transaction fees are outlined on Schedule A of your advisory agreement. These transaction fees can be paid by you
or by your IAR (as determined at the time the account is opened). The transaction fee is charged to defray the costs
associated with trade execution.
Although the transaction fee may be listed as a commission on the trade confirmation, it represents a reimbursement
of transaction costs and not a commission. Your IAR will not receive any portion of transaction fees. Your IAR will
provide you with this fee schedule before you open your account. Your IAR may charge lower transaction fees than
stated on the service schedule. When this happens, your IAR will pay the difference, if applicable. Your IAR may
have a different service schedule than other IARs, but you are not disadvantaged if your IAR has a different service
schedule than our standard service schedule.
GAMA Choice Transaction Fees
Transaction Type Pershing NFS
Listed Equities $25.00 $21.00
OTC Equities $23.00 $21.00
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