Our firm manages assets for many different types of clients to help meet their financial goals while
remaining sensitive to risk tolerance and time horizons. As a fiduciary, it is our duty to always act in
the client’s best interest. This is accomplished in part by knowing the client. Our firm has established
a service-oriented advisory practice with open lines of communication. Working with clients to
understand their investment objectives while educating them about our process, facilitates the kind
of working relationship we value.
We have an ongoing responsibility to select and make recommendations based upon the stated
objectives, risk tolerance and time horizons of the client. Sector Analysts, LLC specializes in the design
of portfolios using exchange traded funds (ETF), mutual funds, fixed income assets, closed-end funds,
unit investment trusts, options, and cash in managing client accounts. Through a multiple step
discovery process, Sector Analysts, LLC obtains the necessary financial data from the client and
assists the client in setting appropriate investment objectives for the Program account. Sector
Analysts, LLC obtains updated information from the client during regularly scheduled client
performance reviews, as necessary in order to provide personalized investment advice to the client.
Our firm sponsors and offers a wrap fee program. Our wrap fee program allows clients to pay a single
fee for investment advisory services and associated custodial transaction costs, because our firm
absorbs client transaction fees, an incentive exists to limit trading activities in client accounts. This
may result in a higher advisory fee to you. We do not charge our clients higher advisory fees based
on their trading activity, but you should be aware that we may have an incentive to limit our trading
activities in your account(s) because we are charged for executed trades. By participating in a wrap
fee program, you may end up paying more or less than you would through a non-wrap fee program
where a lower advisory fee may be charged, but trade execution costs are passed directly through to
you by the executing broker.
Our recommended custodian, Charles Schwab & Co., Inc. (“Schwab”), does not charge transaction fees
for U.S. listed equities and exchange traded funds. Since we pay the transaction fees charged by the
custodian to clients participating in our wrap fee program, this presents a conflict of interest because
we are incentivized to recommend equities and exchange traded funds over other types of securities
in order to reduce our costs. However, our firm primarily recommends and transacts mutual funds
at this time as we believe them to be more efficient for diversifying portfolios and simplifying the
transaction of securities. We evaluate this conflict on an annual basis.
Our Wrap Advisory Services
Wrap Asset Management:
As part of our Wrap Asset Management service, a portfolio is created, consisting of individual stocks,
bonds, exchange traded funds (“ETFs”), options, mutual funds and other public and private securities
or
investments. The client’s individual investment strategy is tailored to their specific needs and may
include some or all of the previously mentioned securities. Portfolios will be designed to meet a
particular investment goal, determined to be suitable to the client’s circumstances. Once the appropriate
portfolio has been determined, portfolios are continuously and regularly monitored, and if necessary,
rebalanced based upon the client’s individual needs, stated goals and objectives.
Fees to be assessed will be outlined in the advisory agreement to be signed by the client. Annualized
fees are billed on a pro-rata basis quarterly in advance based on the value of the managed account(s)
on the last day of the previous quarter. Fee calculations include all client holdings in their managed
ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 5 Sector Analysts, LLC
account. Unless otherwise noted in writing, our firm bills on cash and cash equivalents. This includes
investments in the clients’ employer, which may be concentrated and traded less frequently than
other assets they hold. For purposes of calculating fees, the account quarter begins on the first day in
which the assets arrived in the account. The annual fee is due at the beginning of each quarter
following account opening and includes a prorated fee for the initial quarter. Adjustments will be
made for deposits and withdrawals during the quarter. Fees are negotiable and will be deducted from
client account(s). In rare cases, our firm will agree to directly invoice. As part of this process, Clients
understand the following:
Fee Schedule
Assets Under
Management
Annual Fee Quarterly Fee
Up to $2,000,000 1.00% 0.25%
$2,000,001 - $4,000,000 0.90% 0.23%
Over $4,000,001 0.80% 0.20%
a) The client’s independent custodian sends statements at least quarterly showing the
market values for each security included in the Assets and all account disbursements,
including the amount of the advisory fees paid to our firm;
b) Clients will provide authorization permitting our firm to be directly paid by these terms.
Our firm will send an invoice directly to the custodian; and
c) If our firm sends a copy of our invoice to the client, legend urging the comparison of
information provided in our statement with those from the qualified custodian will be
included.
Other Types of Fees & Expenses:
In addition to our advisory fees above, Clients may also pay holdings charges imposed by the chosen
custodian for certain investments, charges imposed directly by a mutual fund, index fund, or
exchange traded fund, which shall be disclosed in the fund’s prospectus (i.e., fund management fees,
initial or deferred sales charges, mutual fund sales loads, 12b-1 fees, surrender charges, variable
annuity fees, IRA and qualified retirement plan fees, and other fund expenses). Our firm does not
receive any portion of these fees.
Wrap Fee Program Recommendations
Our firm does not recommend or offer the wrap program services of other providers.