Item 5 – Fees & Compensation
Investment Advisory Fees
The standard fees assessed for investment advisory services (the “Advisory Fee”) are charged by SIG based
on a tiered fee schedule where the Client’s assets under management determine the Advisory Fee to be
applied. All Advisory Fees are paid quarterly in advance of each calendar quarter. SIG’s maximum
standard fee is 1%, except where the $2 million household minimum is waived. In circumstances where
the minimum household assets under management is waived, the maximum fee charged is 1.25%.
In determining the fee owed under the tiered or blended fee calculation, a rate will be defined for each tier
of assets under management, and then the total dollar amount of the fee calculated for each tier will be
added together to equal the total fee due to SIG.
All advisory fees and household minimums are negotiable depending on the scope and complexity of the
client’s situation, the services requested and other factors. SIG fees are not based on a share of capital
gains in the Client’s accounts. SIG retains the right to amend the Advisory Fees charged with thirty (30)
days written notice to individual Clients.
Both the description of services offered and the specific manner in which fees are charged by SIG are
established in the Client’s written Investment Advisory Agreement. SIG will, under most circumstances,
bill its annual investment management fees on a quarterly basis, in advance, based on the total value of
the Client’s account at the custodian on the last trading day of the previous calendar quarter (trade date
balances at quarter end–see description below). If the Investment Advisory Agreement is executed at any
time other than the first day of a calendar quarter, SIG Advisory Fees will be applied on a pro rata basis for
that calendar quarter, which means that the Advisory Fee is payable in proportion to the number of days
in the calendar quarter for which one is a Client. SIG currently excludes cash balances from the assets
under management balances used to calculate the Advisory Fee due. Cash equivalent money market funds
and any other traded cash-like mutual funds or ETF’s will be included in the Advisory Fee calculation.
Further, the value of securities held on margin will be included in the Advisory Fee calculation.
Client month end statements may reflect only settled positions as of the last day of the month, depending
on the custodian utilized. Unsettled transactions will be listed as activity in the statement at month end,
even if it is not reflected in the balance. SIG’s billing systems reflect Client positions from the custodian as of
trade date, and SIG’s quarterly Client fee calculation is based on the trade date balance at quarter-end.
Most securities held in accounts managed by SIG will be independently valued by the Custodian or the
private fund advisor.
Some client accounts will hold investments that are not valued by the custodian or by a private fund
manager, including—but not limited to—privately offered securities, limited partnership interests,
promissory notes, non-traded interests, and other illiquid or hard-to-value assets (“Non-Custodian
Valued Assets”). Because in some cases custodians and private fund managers do not provide pricing for
these holdings, our firm must apply a reasonable, good-faith valuation methodology to determine their
value for purposes of account reporting, advisory fee billing, internal performance measurement, and
calculation of regulatory Assets Under Management (“AUM”).
When a third-party valuation is not available, we may determine the value of a Non-Custodian Valued Asset
using one or more of the following methods, as appropriate:
The most recent offering memorandum or subscription statement
The most recent financial statements provided by the issuer
Capital account statements from general partners when available
Independent valuation reports, if provided
A good-faith estimate based on material, reasonably available information
These valuations are inherently subjective and may differ significantly from the value at which the asset
could be sold, redeemed, or realized in a current market transaction. Values may also differ from those
assigned by another adviser, auditor, fund manager, or custodian. Because advisory fees and AUM are
calculated based on asset values, our valuation of Non-Custodian Valued Assets may affect the advisory
fees you pay. Where possible, we seek to use values provided directly by the issuer or fund manager;
however, when such information is delayed, unavailable, or deemed unreliable, we will apply our good-
faith valuation policies. If updated valuations are later received, they will be reflected on a forward-
looking basis only and are not retroactively applied for fee billing. A potential conflict of interest exists
because the firm has a financial incentive to assign higher values to assets that increase billed fees. To
mitigate this conflict, the firm applies consistent valuation procedures, retains documentation supporting
each valuation, and periodically reviews the valuation methodology. Clients may request a copy of our
written valuation procedures at any time. Clients who invest in private or illiquid assets are responsible
for providing the firm with timely and accurate information related to capital account balances, capital
calls, distributions, or other valuation-related documents received from the issuer or fund manager.
Valuations performed for advisory or regulatory reporting purposes do not represent a guarantee of
realizable value and may differ materially from prices obtained upon sale, redemption, or liquidation.
Advisory Fees are typically deducted from the Client’s custodial account. In rare circumstances, as agreed
to by SIG, the Client can elect to pay Advisory Fees directly to SIG via check or other means. Existing Clients
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