Frost Investment Services, LLC (“we,” “us,” “our,” or “FIS”) is a retail investment adviser registered with the SEC,
established in November 2016 and first registered in January 2017. FIS is a wholly owned subsidiary of Frost Bank (“Frost
Bank”). Frost Bank is a wholly owned subsidiary of Cullen/Frost Bankers, Inc.
As of December 31, 2023, FIS had total discretionary assets under management of $2,664,750,805. There are no non-
discretionary assets under management.
We offer investment advisory services to clients (“you,” “your,” or “yours”) through personal consultations designed to
obtain detailed financial information and other pertinent data. In formulating the investment advice to you, factors that we may
consider include the following:
• Financial and personal circumstances
• Risk tolerance
• Investment horizon
• Liquidity needs
• Tax considerations
• Financial goals
• Income (current and potential)
• Portfolio size
• Net worth
• Investment objectives
• Any other issues important to your state of affairs
You should notify us promptly if there are any changes in your financial situation or investment objectives. You should also notify
us if you wish to impose any reasonable restrictions upon the management of your account.
Portfolio Management
We offer a variety of investment strategies, typically managed to an allocation model designed to diversify your securities
portfolios. We offer equity and fixed-income management, providing a range of style-based investment approaches, including:
• Capital appreciation
• Growth
• Growth and income
• Taxable and tax-exempt fixed-income objectives
Assets are allocated within a mix of securities that include all or some of the following:
• Stocks
• Bonds
• Mutual funds
• Exchange-traded products (“ETPs”), including exchange-traded funds (“ETFs”)
FIS has entered into an agreement with our affiliated registered investment adviser, Frost Investment Advisors, LLC
(“FIA”), to provide asset allocation models. The asset allocation models are primarily focused on diversification and
minimizing volatility in a portfolio by distributing assets across a broad spectrum of asset classes. FIA provides guidance to
FIS as to the securities to be bought, sold, or held in each asset allocation model, as well as the percentage of the model
portfolio to be invested in each underlying security. Within the allocation model guidelines, your FIS investment adviser
representative maintains discretion over the implementation of any advice received from FIA. Although diversification may
reduce volatility, it does not ensure a profit or guarantee against a loss.
In January 2023, FIS migrated advisory accounts transitioned from the Envestnet Asset Management, Inc. (“Envestnet”)
managed platform to the Fidelity Managed Account Xchange (“FMAX”) platform. FMAX is an integrated managed account
program sponsored by Fidelity Institutional Wealth Adviser, LLC (“FIWA”), an unaffiliated registered investment adviser.
FIWA is a wholly owned subsidiary of FMR LLC and, together with its affiliates and subsidiaries, is generally known to the
public as “Fidelity Investments” or “Fidelity.”
Implementation Manager
FIWA has retained Envestnet to provide model implementation, overlay management, and other administrative duties.
Envestnet will have discretionary authority over client accounts and will be responsible for the implementation of models
received from model providers within the FMAX platform.
FMAX is designed to provide a highly configurable investment advisory platform, which FIS will use to provide wealth
management solutions directly to our clients. FMAX will also provide risk-based portfolio management tools, including
portfolio modeling and diagnostic tools, rebalancing, drift tolerance controls, and system-generated alerts related to drift
and rebalancing; and administrative services, including risk tolerance questionnaires, investment due diligence,
performance reporting, and fee-billing.
Through the FMAX platform, FIS has four distinct offerings for advisory clients to consider: 1) the Fund Strategist Portfolio
Program, 2) Optimum Asset Allocation Strategy, 3) Advisor Model Management, and 4) the Unified Managed Accounts
Program.
Fund Strategist Portfolio Program
The Fund Strategist Portfolio Program (“FSP Program”) provides a menu of prepackaged investment models provided by
unaffiliated, third-party investment managers (“Investment Managers”). In the FSP Program, the asset allocation and underlying
investments are provided by the Investment Managers on a model basis. These Investment Managers construct an allocation for
their model and select the underlying investments, including actively managed, passively managed, and registered alternative
mutual funds and exchange-traded
products, including mutual funds and ETFs, which, when discussed together, are hereinafter
referred to as (“Funds”). A model’s risk rating allows FIS to select models aligned with a client’s risk profile and investment
objectives.
Optimum Asset Allocation Strategy
The Optimum Asset Allocation Strategy is also an FSP Program that provides a menu of prepackaged investment models
provided by FIS affiliate Frost Investment Advisors, LLC (“FIA”) as the Investment Manager. In the Optimum Asset Allocation
Strategy, the asset allocation and underlying investments are provided by FIA on a model basis. FIA constructs an allocation for
its models and selects the underlying investments, including proprietary Frost Funds and non-proprietary Funds.
Advisor Model Management
The Advisor Model Management (“AMM”) is also known as Advisor Portfolio Manager (“APM”). AMM offers a customized
investment program using asset allocation models and proprietary portfolios offered through FIA. In the AMM offering, the asset
allocation and underlying investments are provided by FIA. As the Investment Manager, FIA constructs an allocation for their
models and selects the underlying investments using proprietary Frost Funds, including equities and individual bonds. FIA
provides investment due diligence and performance reporting.
For additional information, please refer to the Frost Investment Advisors, LLC, Form ADV Brochure available on the SEC’s
website at
www.adviserinfo.sec.gov.
Unified Managed Account Program
The Unified Managed Account (“UMA”) Program enables clients the ability to incorporate multiple Funds and strategies into a
single account by accounting for each unique investment strategy as a unique investment “sleeve” within a single account (e.g.,
Fund sleeves, individual Separately Managed Account (“SMA”) manager sleeves, and Fund Strategist sleeves). FIS may develop
a UMA portfolio for a client by first creating their own asset allocation. FIS then determines the investment solution(s) to utilize
within the UMA from the options available on the platform, including investment models, SMAs, Funds, and individual securities.
Tax and Impact Overlay Services
For UMA accounts that meet certain sleeve minimum requirements, FIS offers clients the ability to utilize tax and/or impact
overlay services (“Tax Overlay” and “Impact Overlay”). Tax Overlay seeks to enhance after-tax returns by analyzing holdings
and trading activities in an account. Impact Overlay allows the integration of Environmental, Social, and Governance (“ESG”)
factors into the management of a client’s account. If selected, the Implementation Manager provides the Tax Overlay and/or
Impact Overlay services to an account or sleeve. Neither FIS, FIWA, nor Envestnet provide tax planning advice or services, and
therefore, clients should consult their accountant or tax professional.
The Impact Overlay is administered by FIWA who determines the factors that qualify an investment for that designation. The
FIWA research team follows a proprietary ESG evaluation framework to qualitatively evaluate a given Fund’s or SMA’s ESG
intent (if any), whether such intent has been consistent and is aligned with its investments and ESG outcome, and the level of
commitment and engagement that exist to support the intended ESG outcome and reporting.
FIS does not conduct an independent assessment of an investment’s ESG factors.
For additional information, please refer to the Fidelity Institutional Wealth Adviser LLC, Form ADV brochure titled “Fidelity
Managed Account Xchange,” available on the SEC’s website at
www.adviserinfo.sec.gov.
Financial Planning
We can prepare and provide you with a written financial plan designed to help you achieve your financial goals and
investment objectives. The preparation of such a plan necessitates that you provide us with personal data such as:
• Family records
• Budgeting
• Personal liabilities
• Estate information
• Additional financial goals
The financial plan may include any of the following as requested or directed by you and agreed upon by contract:
• Asset protection
• Tax planning
• Business succession
• Strategies for exercising stock options
• Cash flow
• Education planning
• Estate planning and wealth transfer
• Charitable gifting
• Long-term care and disability planning
• Retirement planning
• Insurance planning
• Risk management
We do not provide accounting, tax, or legal advice. Should you choose to implement the recommendations contained in the
plan, we suggest working closely with your attorney and accountant.
Financial planning is included in our advisory fee. Please refer to our management fee schedule below.