Paragon Asset Management Inc

7. Types of Clients & Account Minimums
with thirty (30) days written notice to Client and by
the Client at any time with written notice to Paragon.        Paragon’s Clients are generally individuals, high net-
For accounts opened or closed mid-billing period,             worth individuals, businesses, corporations, and
fees will be prorated based on the days services are          charities. Client relationships vary in scope and length
provided during the given period. All unpaid earned           of service.
fees will be due to Paragon. Any increase in fees will
                                                              Paragon requires a minimum account size of
be acknowledged in writing by both parties before
                                                              $250,000 to enter into an Advisory Agreement.
any increase in said fees occurs.
                                                              However, Paragon retains the discretion to lower or
C. Additional Fees                                            waive said minimum.
Custodians may charge brokerage commissions,
transaction fees, and other related costs on the              8. Methods of Analysis, Investment
purchases or sales of mutual funds, equities, bonds,          Strategies and Risk of Loss
options, margin interest, and exchange-traded funds.          A. Methods of Analysis and Investment
Mutual funds, money market funds, and exchange-               Strategies
traded funds may also charge internal management
                                                              Investing in securities involves risk of loss that
fees, which are disclosed in the fund’s prospectus.
                                                              Clients should be prepared to bear. Past performance
Paragon does not directly receive any compensation
                                                              is not a guarantee of future returns. Security analysis
from these fees. All of these fees are in addition to the
                                                              methods may include:
management fee you pay to Paragon. For more details
on the brokerage practices, see Item 12 of this               Fundamental analysis concentrates on factors that
brochure.                                                     determine a company’s value and expected future
                                                              earnings. This strategy would normally encourage
D. Prepayment of Fees
                                                              equity purchases in stocks that are undervalued or
Paragon does not expect Clients to prepay fees.               priced below their perceived value. The risk assumed
                                                              is that the market will fail to reach expectations of
                                                              perceived value.

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                          Form Adv Part 2A

                      Technical analysis attempts to predict a future stock      In ation Risk. When any type of in ation is present, a
                      price or direction based on market trends. The             dollar today will buy more than a dollar next year,
                      assumption is that the market follows discernible          because purchasing power is eroding at the rate of
                      patterns and if these patterns can be identi ed then a     in ation.
                      prediction can be made. The risk is that markets do
                                                                                 Currency Risk. Overseas investments are subject to
                      not always follow patterns and relying solely on this
                                                                                   uctuations in the value of the dollar against the
                      method may not take into account new patterns that
                                                                                 currency of the investment’s originating country. This
                      emerge over time.
                                                                                 is also referred to as exchange rate risk.
                      The main sources of information include nancial
                                                                                 Reinvestment Risk. This is the risk that future
                      newspapers and magazines, annual reports,
                                                                                 proceeds from investments may have to be reinvested
                      prospectuses, and lings with the SEC.
                                                                                 at a potentially lower rate of return (i.e. interest rate).
                      B. Investment Strategy                                     This primarily relates to xed income securities.

                      The investment strategy for a speci c Client is based      Liquidity Risk. Liquidity is the ability to readily
                      upon the objectives stated by the Client during            convert an investment into cash. Generally, assets are
                      consultations. The Client may change these objectives      more liquid if many traders are interested in a
                      at any time by providing written notice to Paragon.        standardized product. For example, Treasury Bills are
                      Each Client executes a Client pro le form or similar       highly liquid, while real estate properties are not.
                      form that documents their objectives and their desired
                                                                                 Management Risk. The advisor’s investment
                      investment strategy.
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