Item 5 - Fees and Compensation
Parnassus Investments provides investment advisory services to the Parnassus Funds and
separate accounts. Parnassus also provides investment advisory and subadvisory services to
other institutional accounts, as described in Item 4.
Investment Company Fees
Parnassus Investments charges advisory fees based on a percentage of net assets, generally
ranging from 0.50% to 1.10%, depending on the amount of assets. Advisory fees are subject to
review and approval by the Funds’ Boards of Trustees and are set forth in the Funds’ prospectus.
Fees are payable monthly for the previous month.
Separate Account Fee Schedule
Parnassus Investments’ current fee schedule for separately managed account clients is based on a
percentage of assets under management, as follows:
ANNUAL MINIMUM
STRATEGY NAME RATE ANNUAL FEE
Parnassus Core Equity
Of the first $200 million in assets 0.40% $100,000
Of the amount above $200 million up to $400 million 0.35%
Of the amount above $400 million in assets 0.30%
Parnassus Mid-Cap Equity 0.70% $175,000
Parnassus Endeavor Large-Cap Equity 0.65% $162,500
Parnassus Mid-Cap Growth Equity 0.70% $175,000
Parnassus Core Fixed Income 0.50% $125,000
Parnassus Investments reserves the right to negotiate fees at its discretion. Parnassus
Investments may agree to different fees than those shown above depending on factors such as
investment objectives and restrictions, the nature of the client relationship, the length of time of
the relationship, the size of the account and other factors. We also reserve the right to aggregate
accounts for purposes of applying the breakpoints in the above fee schedule.
The separate account minimum is generally $25,000,000 for all strategies, although Parnassus
Investments reserves the right to waive the minimum at its discretion.
The specific manner in which separate account fees are charged by Parnassus Investments is
established in the client agreement. Parnassus Investments will generally bill its fees on a
Parnassus Investments
Form ADV, Part 2A
quarterly basis. Clients are generally billed in arrears each calendar quarter. Clients may elect to
be billed directly for fees or to authorize Parnassus Investments to directly debit fees from client
accounts. Upon termination of any account, any prepaid, unearned fees (pro-rated through the
date of termination) will be promptly refunded, and any earned, unpaid fees will be due and
payable.
Other Clients
The fees Parnassus Investments charges for services to the UCITS portfolio and to other
managed accounts vary depending on the level of assets and services provided.
Model Services
The fees charged for Model Services provided to financial institutions are negotiated in
consideration of the type of services and capacity that Parnassus Investments is required to
perform. Parnassus Investments is paid an annualized investment advisory fee based on the total
underlying client assets which are managed on the basis of the Model Portfolio(s) provided under
the Model Services arrangement.
Other Fees
Clients incur additional fees outside of Parnassus Investments’ fees, including brokerage
commissions, transaction fees, and other related costs and expenses. Please see Item 12 –
Brokerage Practices for more information on these types of fees. Clients may incur certain
charges imposed by custodians, brokers, third party investment managers and other third parties
such as fees charged by managers, custodial fees, deferred sales charges, odd-lot differentials,
transfer taxes, wire transfer and electronic fund fees, and other fees and taxes on brokerage
accounts and securities transactions. Mutual funds and exchange-traded funds (ETFs) also
charge internal management fees and other expenses, which are disclosed in a fund’s prospectus.
Such charges, fees and commissions are exclusive of and in addition to Parnassus Investments’
fee. Neither Parnassus Investments nor its personnel receives any portion of these commissions,
fees and costs or any other compensation for the sale of the Funds or other investment products.
If a separate account client is invested in a Parnassus Fund, fee offsets will apply to the
management fee charged by the Fund.