Item 5: Fees and Compensation
Generally, our fees for investment advisory services are calculated as a percentage of a client’s assets under management and will
not exceed 1%. The firm may waive or change its fees upon request or upon its own initiative. We usually charge our advisory fee
until we are terminated from the management of an account, or until the account is fully settled.
Standard Advisory Fee
Wrap Fee Programs
Except as noted below, the wrap fee programs described in Item 4 generally provide for an all-inclusive fee, which usually covers
fees for investment management, trade execution, activity reporting, custodial services, and the recommendation and monitoring
of investment managers. Roosevelt Investments is generally compensated on the basis of a fee which is a percentage of a client’s
assets under management (including cash, which we view as an asset class). Clients should discuss wrap fees directly with the
program sponsor, as Roosevelt Investments is not responsible for reviewing or ascertaining whether a wrap program, or wrap fee,
Form ADV Part 2A
March 2024 Page 6 of 24
is suitable for a client.
As mentioned above, a wrap fee client will likely incur additional fees beyond the all-inclusive wrap fee. This is because, as
described below, we believe that clients benefit from the practice of “step-out” trading (also referred to as “trading away”).
Wrap Fee Programs: Trading Away
There are generally two instances in which we seek to make trades in a client’s investment account:
• The first is when we update our overall investment model upon which accounts are based. Here we usually want to adjust
all accounts in the relevant strategy, and the change in the investment model will result in what we call an “across the
board” trade.
• The second is when trades are needed because of specific activity within an account, such as when a new account opens,
an account closes, or money is taken from or added to the account. We call these trades “maintenance trades”.
For across the board trades, Roosevelt often directs that the trade be executed by a broker-dealer other than the sponsor, a
practice we refer to as stepping-out the trade. With no further notice, clients in a wrap fee program will therefore usually incur
additional commissions and fees (approximately 2.5 cents) beyond the wrap program fee due to participating in the stepped-out
trade. The commissions paid on trades executed away from the sponsors are reflected in the transaction price at which the
securities are bought or sold (rather than being separately stated or charged).
We believe that stepping out these trades helps us to seek to achieve best execution because, among other things, it helps to:
minimize the risk of market movement in pricing, achieve competitive pricing, access additional liquidity sources and ensure that
participating clients receive the same execution price.
Roosevelt provides wrap sponsors the names of brokers executing trades at Roosevelt’s direction for the sponsor’s clients and the
specific commissions paid to such brokers, upon request. A wrap program sponsor determines the trading information (e.g.,
brokers used and commissions charged) it provides to its customers.
To the extent trading away may reduce wrap sponsor trading costs, a sponsor may have an incentive to recommend Roosevelt
over a manager that does not trade away. SMA fees vary across SMA sponsors, generally ranging between 1.0% and 3.0% of total
assets under management.
Other Fees and Expenses
Our investment advisory fee does not include other fees imposed by custodians, brokers, and other third parties that could
include the following:
• Fees charged by managers
• Custodial fees
• Brokerage commissions
• Deferred sales charges
• Odd-lot differentials
• Transfer taxes
• Wire transfer and electronic fund fees
• And/or other fees and taxes on brokerage accounts and securities transactions
Item 12 further describes the factors that we consider in selecting or recommending broker-dealers for client transactions and
how we determine that the broker-dealer commissions are reasonable.
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March 2024 Page 7 of 24
We include mutual funds and exchange traded funds, (“ETFs”) in
numerous of our investment strategies. Mutual funds and ETFs charge expense ratios An expense ratio is a measurement of
and may charge commissions as well. These charges are in addition to our fee, and we what it costs to operate a mutual fund or
do not receive any portion of these charges. This is called layering of fees. ETF. Operating expenses, which include
the management fee, are taken out of a
For example, layering of fees for a single ETF position of $10,000 could include the fund’s assets and lower the return to a
annual Roosevelt investment management fee of 1.00%, plus a typical ETF expense fund’s investors.
ratio of 0.90%. The total cost for the one ETF position annually would be $190, or
1.90%. The remainder (non-fund positions) of a client’s account is only billed at 1.00%,
or the advisory fee for the specific product a client has invested in.
Roosevelt Investments employs personnel to support and enhance distribution of Roosevelt Investments’ investment strategies
through the SMA and model-based sponsor firms with which we work. These staff receive various forms of compensation,
including based on a percentage of revenue we receive from existing SMA and model-based accounts. We believe that this
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