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GeoWealth Policy Reminders

Here is a convenient, consolidated reference to certain GeoWealth policies designed to ensure service efficiency, accuracy and responsiveness, and to focus our resources where we make the greatest impact for our advisors.

 

Our Account Minimum is $25,000

The GeoWealth account minimum is $25,000. With the high level of operational service we provide advisors, there is a minimum fixed expense to every account opening and to ongoing account maintenance. It doesn’t make business sense to have accounts under $25,000.

However, we recognize there will be limited legitimate cases where you have an important client requesting a small account be permitted. Our extensive menu of single-sleeve ETF models facilitates this need but small account exceptions will only be permitted in limited instances tied to a large client household.

Over the years we have accumulated many accounts with significantly less than $25,000, primarily through withdrawal of a portion of the assets, leaving behind less than $25,000. For quite some time we have not allowed partial withdrawal of assets if the result is the remaining account assets are less than $25,000. The withdrawal will have to be for the full account. The limited number of small accounts still existing are subjected to our minimum monthly Platform Fee described below.

If you have questions about this policy, please email them to service@geowealth.com. We want this to be implemented in a way that makes the most sense for your practice and at the same time for our business model.

 

Minimum Monthly Platform Fee

The $12.50 minimum monthly Platform Fee introduced a few years ago impacts only accounts that are at lower fee rates and low asset levels.

 

Automatic Account Closing – No Reopening

We close zero balance accounts as soon as possible. If an account is liquidated, you can consider it closed. When we receive a request to distribute all assets from an account, we subtract accrued fees before distributing the assets and then promptly close the account. If the client intends to deposit funds in the future, a new account application will have to be submitted.

 

Model Minimums

The GeoWealth Model Marketplace is expansive and diverse enough to cover most investor needs and objectives, resulting in model minimums ranging from $1,000 for simple single-sleeve models with a small number of ETF holdings all the way to $1,000,000 for true individual fixed income separately managed portfolios and institutional cash management. As the minimums for the individual models increase, the UMA models holdings model sleeves have their minimums increased in line. This work has been gradual to assist advisors with making model changes to account for potentially higher minimums. In the months ahead, we will be fully implementing higher minimums for advisor-built UMA models.

 

Maximum Number of Models in Fund Program Account

Multi-sleeve, multi-manager UMA models have incredible one-click efficiency. GeoWealth technology automatically maintains the models for most changes over time. For example, the technology identifies which sleeves are furthest from target so that is where incoming cash goes and outgoing cash comes from. This is the easiest and most tax efficient way to maintain models over time. And when it is time to fully rebalance a UMA model, it is done with one click.

Single-sleeve models holding only pooled vehicles are not only great candidates to be sleeves in a UMA model, often they are the right standalone solution for an account. This latter use case was never intended to be the purchase of several standalone single-sleeve models in an account because in that structure all the efficiencies of the multi-sleeve UMA model are lost. Therefore, we are limiting standalone model purchases in an account to three and even questioning the use of three when one UMA can be used. If you opt for this structure of multiple models in an account, you are responsible for entering all cash management investment transactions in the GeoWealth Service Center yourself, including Inject Cash, Raise Cash, and Change Managed Investment; investment instructions form submissions are not allowed for these service requests. Although, if you demonstrate you have the self-service bandwidth, resources, and precision in your practice to manage more standalone models per account, we are certainly open to supporting that approach. But what we have experienced so far is that advisors and their staff find it too much work to not use the one-click UMA models.

 

Maximum Number of Model Sleeves in a UMA Model

The power of fractional share investing has facilitated extensive portfolio diversification, but it was never intended to result in individual security positions of hundredths of a share. The business model expectation is that the daily collective transactions accumulate to near-whole share amounts. To improve our efficiency and limit trading risk, we are encouraging the use of a limited number of sleeves in a multi-manager UMA model and applying higher UMA model minimums when a large number of sleeves are in a UMA model.

 

Limit Advisor-Built Models to Select Advisors

Facilitating advisor-built models is welcome and eagerly invited because we believe in the investment acumen of advisors, and we realize supporting custom branded advisor models is a unique competitive advantage of GeoWealth. But facilitating advisor-built models is demanding work that introduces greater risk to our company. Therefore, we restrict access to this service to only advisors who have made GeoWealth a core part of their practice. This, of course, means something different to all advisors, and so we are not applying an asset minimum. If you have made advisor-built models on our platform a core part of your practice, rest assured we will continue to welcome that business.

 

No Unique Portfolios

A Unique Portfolio is defined as one not intended by the advisor to be used for multiple accounts. A Unique Portfolio has target holdings and weights that only exist in one account, making it unique. GeoWealth is a platform that functions at the model level with scalable, convenient, one-click processing, whether you are making a new investment, changing from one model to another, raising cash, or adding to an existing account.

Although we have not permitted the creation of new Unique Portfolios for several years, we have been retaining Unique Portfolios for which an advisor deems it appropriate not to make portfolio changes. But unchanged portfolios over extended periods of time are not realistic. Therefore, we will be moving many of the accounts with Unique Portfolios to appropriate pre-built model replacements. We will speak to impacted advisors directly.

Meanwhile, the only actions that can be taken with a Unique Portfolio are to add or remove funds, either one-time or recurring in the one account in which the Unique Portfolio is held. If you have determined that the holdings and/or weights of a Unique Portfolio need to be changed, that is the time to move the client to an existing pre-built or advisor-built model, or to create a new advisor-built model, which you intend to use going forward for more than one account.

Many advisors have realized the benefits on our platform of having hundreds of accounts in one or two core models carefully curated and easily changed across the entire client base. Imagine the practice leverage you will have with models purchased with one click and the ease of changes sweeping across hundreds of portfolios with one click.

 

Pending Service Requests Terminated if No Advisor Response in 30 Days

It's essential that all requests are in good order to ensure prompt completion. If a request lacks a necessary form, information, signature, or any other required element that prevents us from fulfilling the request, we promptly inform you and maintain regular communication to resolve the issue. If we don't receive the required information or documents within 30 days of notifying you about the request being incomplete, we will terminate and close the request and service ticket. Once you obtain and deliver to us the missing requirement(s), we will open a new ticket. Pursuant to uniform custodian policy, signatures expire after 60 days. Therefore, any signed documents aged beyond 60 days will need to be re-signed.

 

Verbal Confirmation for Vulnerable Cash Transactions

Phishing and social engineering attacks are increasingly sophisticated techniques employed by cybercriminals to deceive individuals into divulging sensitive information or performing actions that compromise personal and financial security. These threats continue to evolve and pose a significant risk to individuals and organizations alike. To counter these threats, we require verbal confirmation for certain types of activities.

  • Requests sent via fax: Fax numbers are easily spoofed and a primary vector of fraudulent activity. GeoWealth will contact the advisor verbally and confirm that the advisor has verbally verified the authenticity of the faxed submission with the client.
  • Requests within 30 days of client profile changes: If a client changes their phone number, email or physical address and a withdrawal request or other material change in the account is received within 30 days, we require the advisor to confirm that they have verbally verified the withdrawal request with the client directly, with a strict verification of verbal or video client identification.
  • Establishing a New Bank Link: Advisors must verbally confirm directly with their client that the bank information is correct and authorized prior to submitting the request to GeoWealth. Upon receipt, GeoWealth will contact the advisor verbally using the contact information we have on file.
  • Third Party Distributions: GeoWealth will contact the advisor verbally and confirm that the advisor has verbally verified directly with the client the authenticity of the faxed submission.

 

Restricted/Excluded Securities

For securities that generate a K-1 tax form and certain other security types that generate restrictions, we have a streamlined and efficient process.

Not all custodians treat securities uniformly, making it impractical for us to attempt to treat security restrictions uniformly across all custodians.

For securities that produce a K-1, as well as certain illiquid securities, leveraged ETFs, inverse ETFs, interval funds, closed end funds, and other products with limited liquidity or other custodial challenges, we defer to the discretion of our money managers. We have asked our money managers to avoid these challenging security types unless they have made the determination that the attractiveness of the investment potential is significant enough to have our investors endure the inconvenience.

As fiduciaries, money managers have the responsibility to design models in accordance with each specific strategy. We will no longer override their investment direction with general restrictions. If a money manager believes that incorporating these types of securities is in the best interest of investors, we will not impede them through general restrictions.

However, we understand that some clients may still have reservations about owning specific securities, such as those that issue K-1 forms, illiquid assets, or derivatives, despite the investment direction provided by the money manager. In such cases, we offer the option to individually restrict client account(s). If you wish to add security restrictions to a client’s account, kindly provide us with a file containing the tickers of the securities to be excluded and then keep us updated as the list changes.

The above does not apply to industry or social exclusions, such as ‘No Tobacco Stocks.’ For these instances, your client only needs to provide the industry or social exclusion category; we are providing those security lists.

 

Investment Plan Requirements

New Account: An Investment Plan is not required to open a new account, as we recognize that there may be times when an account needs to be opened before investment decisions are made by the client. A new account cannot be invested until a signed Investment Plan is on file.

Additions/Changes to Existing Accounts: It is required by the GeoWealth Investment Management Agreement signed by the client that you confirm with your client at a minimum annually their investment objectives, time horizon, and risk profile. If the Investment Plan on file is greater than one year old, it is required that you either confirm it remains appropriate or you must include a new signed Investment Plan when you submit instructions to invest new funds or make changes to the existing portfolio. If you are moving the client’s portfolio more than one risk tolerance level from that authorized in the signed Investment Plan, you must submit a new Investment Plan.

If you have questions or require further clarification please reach out to your Service Team.