ANNUAL INVESTING EXPENSE APPROXIMATION
Below is an approximation of the typical annual expenses a portfolio managed by Loynd Capital Management experiences.
Expenses can only be approximated due to a number of variables that depend upon the size and makeup of individual portfolios and variables that change from year to year such as the investment products’ annual expenses.
Expenses fall into three categories:
1: Advisor fees paid to Loynd Capital Management
2: Investment product fees deducted by the investment product firm
3: Transaction commissions deducted by the discount brokerage firm where accounts are held.
A typical portfolio of less than $1 million will experience total annual expenses of approximately 1.25% to 1.5%. Larger portfolios experience lower percentage expenses. (This is in the same range as the reported annual expense ratio of the average no-load equity mutual fund. Reported fund expense ratios do not reflect all expenses that funds encounter. Brokerage commissions, bid/ask spreads, and “soft dollar” arrangements that
fund management firms may have with brokerage firms are examples of expenses that mutual funds encounter that are not included in reported annual expense ratios).
1. Annual Advisor Fees Fees are deducted quarterly. For example, 1% = 0.25% quarterly.
1.0% on the first $500,000
0.8% on $500,001 to $1,000,000
0.6% on $1,000,001 to $1,500,000
0.4% on greater than $1,500,001
2. Annual Mutual Fund Fee Approximation With the use of asset-class funds, this expense will be approximately 1% below that experienced by comparable speculatively traded mutual funds.
These expenses are not exactly the same each year, however, they are usually quite consistent. Less than 0.5%
3. Brokerage Transaction Commission Approximation (Presently Charles Schwab & Co.)
Please note that Loynd Capital Management receives no commission compensation. These commissions will be largest upon the initial investment of the entire portfolio. Since a goal of our strategy is to keep trading to a minimum, commission expenses will be lower during years following the initial investment.
Initial investment: 0.1% to 0.3%
(Portfolios in excess of $1,000,000 usually experience less than 0.1% initial brokerage
commissions.) Ongoing years: 0% to 0.1%
A $500,000 portfolio will experience total annual expenses of less than 1.5%.
A $3,000,000 portfolio will experience total annual expenses of about 1%.