What to Expect as an Investment Management Client
If you become an Investment Management client at Compass, you can expect the following from us:
- In-depth onboarding process to ensure that we truly understand your goals, concerns, risk tolerance, investment time frame and other relevant considerations
- Assistance opening a brokerage account at our recommended independent custodian
- Creation of a customized asset allocation based on your unique circumstances
- Investment Policy Statement which describes your target asset allocation and other investment parameters
- Initial investment of your portfolio
- Ongoing monitoring of your portfolio
- Regular re-balancing of your portfolio
- Occasional tactical asset allocation shifts in your portfolio when valuations and fundamentals warrant such a shift
- Quarterly reporting from Compass which includes your asset allocation and investment performance
- Monthly holdings reports from your custodian
- Open channels of communication
- Any desired financial planning services
The advisory fees charged to the Client by Compass Financial Planning for services provided are based on the following annual percentages:
Compass requires a minimum annual advisory fee of $1,000 for our Investment Management Services. The advisory fee rate is a single fee rate based on account value as outlined above and is not a graduated fee.
Advisory fees are paid quarterly in arrears. Compass uses an average of the daily balance in the Client’s account throughout the billing period for purposes of determining the market value of the assets upon which the advisory fee is based. For more detailed information on our fees, please see the link to our Form ADV at the bottom of this page.
Compass reviews client portfolios on a quarterly basis to determine if re-balancing is necessary. Re-balancing is considered necessary if asset class weightings differ from the client’s target asset allocation weightings by greater than 10% of the target weighting at the time of review. As an example, if the Client’s target asset allocation for US Large Cap Stocks were 20%, then 10% of this target weighting would be 2%. Therefore, the weighting of US Large Cap Stocks in the portfolio could range between 18% and 22% without any re-balancing taking place. If the weight were to drop below 18% or go above 22% then re-balancing would occur at the quarterly review period.
We ask that you contact us whenever there is a change in your life that will impact your financial situation. We are also happy to talk whenever you have a question about the markets, your portfolio or other financial planning matters. You can expect to receive a quarterly report from Compass which states your asset allocation as well as your investment portfolio’s performance. We may also contact you intermittently if there is news relevant to your portfolio that is important for us to share. At minimum, we will organize a formal meeting once a year to discuss any changes to your situation, address any questions you may have, and to review your portfolio.
Compass will provide financial planning services to Investment Management clients at no extra charge if they are desired. You can have a comprehensive financial plan completed or more focused plans made, such as a college savings plan or a retirement savings plan.