A. Overview – Equitable Advisors and its Financial Professionals
Equitable Advisors is a Delaware limited liability company formed in July 1999. Equitable Advisors is
registered with the SEC as (1) an investment adviser under the Advisers Act, and (2) a broker-dealer under
the Securities Exchange Act of 1934, as amended (“Exchange Act”), and, as a registered broker-dealer, is
a member of the Financial Industry Regulatory Authority, Inc. (“FINRA”). Equitable Advisors is an indirect
wholly owned subsidiary of Equitable Holdings, Inc. (“EQH”), a public company under the Exchange Act,
the common stock of which is traded on the New York Stock Exchange (NYSE: EQH). EQH comprises two
principal financial services franchises: Equitable and AllianceBernstein. Equitable is the brand name of
the retirement and protection subsidiaries of EQH, including Equitable Financial Life Insurance Company
(Equitable Financial) (NY, NY); Equitable Financial Life Insurance Company of America (Equitable America),
an AZ stock company with an administrative office located in Charlotte, NC; and Equitable Distributors,
LLC. AllianceBernstein (“AB”) is the brand name of the global asset management and broker-dealer
subsidiaries of AllianceBernstein L.P., which provide investment management and research services
worldwide to institutional, high-net-worth and retail investors.
As an investment adviser, Equitable Advisors and its investment adviser representatives (in such capacity,
“IARs”) have a fiduciary duty to advisory clients. All of our IARs are also registered representatives in our
broker-dealer business; however, most, but not all, of our registered representatives in our brokerage
business are also IARs. Many of our IARs also are licensed as insurance agents of Equitable Network, LLC
(“Equitable Network”) another indirect subsidiary of EQH (and, therefore, our affiliate), and act in such
capacity when recommending variable annuity products to clients. Our IARs are generally referred to in
this Brochure as “Financial Professionals.”1 Our Financial Professionals may also be known as Financial
Consultants, Associate Financial Planners, Financial Planners, Financial Advisors or Registered
Representatives (the latter in the broker-dealer context).
Most, but not all, of our Financial Professionals are fully credentialed and able to offer the full range of
advisory services described in this Brochure. However, Equitable Advisors requires that a Financial
Professional hold additional credentials, undergo specific training, or satisfy other qualifications before
providing certain services. These include, for example, certain financial planning services, exercising
discretionary authority over client accounts in the Strategic Asset Management Program (“SAM”), or
serving as a fiduciary or investment manager to a qualifying plan account under Section 3(21) or Section
3(38) of ERISA, respectively (each as discussed in this Item 4 below). In some cases, Financial Professionals
not authorized to provide a given service are permitted only to refer clients to other of our Financial
Professionals or to third-party asset management firms. Depending on your needs, such limitations may
present a conflict of interest for your Financial Professional. You should discuss any such limitations with
your Financial Professional to ensure you understand any applicable limitations and any conflicts of
interest to which they give rise.
Equitable Advisors and its Financial Professionals do not provide legal, accounting or tax advice or services.
We recommend that clients consult their own legal, accounting, and tax advisers in connection with the
1 In providing advisory services to clients, our Financial Professionals may also use the titles Financial Consultant,
Associate Financial Planner, Financial Planner (if so qualified), or Financial Advisor.
implementation of a financial plan or investment advice. Additionally, Equitable Advisors’ Financial
Professionals do not provide investment advisory services to federal, state, or local governmental entities.
This Brochure discusses conflicts of interest that are relevant to Equitable Advisors’ business as a federally
registered investment adviser under the Advisers Act. Certain professional organizations may also have
disclosure or other requirements. For additional information, please see Equitable Advisors’ Relationship
Summary for Retail Investors (“Form CRS”), General Conflicts of Interest Disclosure, Third-Party
Compensation and Conflicts of Interest Disclosure, and Principles of Investing brochure, all of which are
available on our disclosure website
at https://equitable.com/CRS. Clients are, of course, always welcome
to contact the Financial Professional that services their account or planning needs.
B. Tailoring Our Services to a Client’s Needs
We strive to tailor our advisory services to the individual needs of our clients. Prior to providing a client
with any financial planning or other investment advisory services, a Financial Professional will work with
the client to mutually define the scope of the services. This process will include an exploration of the
client’s values, attitudes, expectations, risk tolerance, and time horizons, as well as the client’s financial
goals, needs and priorities.
The Financial Professional will also work with the client to determine which assumptions should be used
in developing financial planning advice, so that any projections included reflect the client's views on future
conditions and events. These assumptions may include personal assumptions (
e.g., retirement age, life
expectancy and income needs) as well as economic assumptions (
e.g., inflation rates, tax rates and
investment returns). Such assumptions and projections are described in more detail in this Item 4, below.
C. The Advisory Services We Provide to Clients
We offer two main types of investment advisory services:
(1) financial planning (discussed in Section D below), and
(2) asset management (discussed in Section E below).
In some circumstances, we also offer education and other services to retirement plan sponsors and their
participants and, as part of our asset management business, fiduciary advisory services to plan fiduciaries
(including discretionary and non-discretionary asset management). This business is specifically discussed
in Section D.5.
In the remainder of this Item 4 – Advisory Business, we will provide more detail regarding our financial
planning and asset management services.
D. Financial Planning Services
1. Financial Planning Generally
Our Financial Professionals may provide personal financial planning services that include education,
advice, and the preparation and delivery of a written financial plan or advice that includes general
recommendations to help the client achieve his or her personal financial goals. In some circumstances,
affiliated representatives of Equitable Advisors may also refer potential clients for financial planning
services to other investment advisers and receive compensation for the referral.
Our personal financial planning services typically involve three steps:
• gathering information from the client and completing a client profile;
• developing the advice or plan; and
• delivering and presenting the plan or advice to the client.
A client may enter into a financial planning agreement with Equitable Advisors by signing a financial
planning services agreement and, in most cases, agreeing to pay a fee in exchange for those services. We
offer both fee and non-fee financial planning programs. The financial planning agreement is cancelable
at any time by either party for any reason and has a one-year term; at the expiration of that term, if
desired, a new agreement must be executed by the client. In addition, except as described below with
respect to ongoing advice models, Equitable Advisors will refund the full financial planning fee paid by any
client who is not satisfied with the services and requests a refund within ninety (90) days after service
delivery.
The financial plan or advice will not include investment advice, analysis, or recommendations regarding
specific securities or investment or insurance products. Upon delivery of a financial plan or advice to a
client, the client will review the plan or advice and provide acknowledgement of receipt through a signed
delivery receipt or via an electronic acknowledgement. The financial planning advisory relationship ends
upon the client’s acknowledgment of the written financial plan or advice. However, because our Financial
Professionals are also registered representatives of Equitable Advisors, a registered broker-dealer, and
licensed insurance agents of Equitable Network, they are able to identify insurance and securities
products and other investment advisory services offered by Equitable Advisors, its affiliates, and various
carriers and other investment product or service providers that may be suitable for implementing the plan
or advice. These product-specific implementation recommendations may be prepared in a separate
written document, generally following plan delivery. Any document in which they may be set forth is not
part of the plan or advice.
Equitable Advisors generally will receive commissions (or advisory fees) if the client decides to purchase
any products or services through the Financial Professional, and the Financial Professional will receive a
portion of any commissions received in his or her capacity as a registered representative of a broker-
dealer or as an insurance agent, and/or fees for any advisory services performed. Thus, the Financial
Professional has an incentive to recommend that such products or services be obtained through Equitable
Advisors, which is a conflict of interest. Equitable Advisors addresses that conflict through supervisory
oversight designed to ensure that all recommendations by the Financial Professional comply with
regulatory requirements, and by the fact that clients have no obligation to purchase any such products or
services through Equitable Advisors, its affiliates, or other carriers.
In some circumstances, Financial Professionals with clients in managed accounts, as described in the
“Asset Management Programs” section below, include financial planning services within the services
provided as part of their annual asset-based fee.
Equitable Advisors also makes available a variety of financial analyses, account review tools and reports
for clients. Unless accompanied by a financial planning agreement and a copy of this Brochure, these
documents are not part of Equitable Advisors’ financial planning services and are provided to clients either
in our capacity as a broker-dealer (and/or insurance agent, by our affiliate Equitable Network), to provide
education and/or advice regarding products, or in our capacity as a registered investment adviser to help
clients select, allocate their assets among, and monitor the performance of specific investments.
The following is a description of the various personal financial planning services we offer. A fee schedule
and additional information relating to how fees are determined and paid with respect to such services is
included in Item 5 – Fees and Compensation.
Goals
Based on the long-term goals a client has identified; a Financial Professional will analyze the client’s
particular situation and provide recommendations on the topics that align with his or her goals. Financial
planning services may or may not also include other services listed below.
Financial Position
The Financial Position topic is designed to ensure the foundation of a client’s financial plan is secure. This
area may also evaluate the client’s current level of cash reserves to provide an assessment of his or her
ability to cover expenses in the case of emergency.
Insurance Needs
This service is intended to prepare clients for the unexpected needs or impact on cash flow or net worth
arising from death, disability and long-term care, or other circumstances specific to the client’s personal
financial situation. A client’s Financial Professional may provide advice regarding the level of survivor
income protection and disability insurance a client may need in order to protect his or her (or survivors’)
financial goals and desired lifestyle. This service may include estimates of survivor income needs resulting
from a lost pension or social security income due to a spouse passing away. A client’s plan may also include
advice on the level of long-term care coverage he or she may need to protect assets from depletion and
to maintain a desired retirement lifestyle.
Asset Allocation and Investment Planning
This service provides a client with an evaluation assets and potential strategies to help optimize portfolio
performance to reach his or her goals. An asset allocation report may be provided to help a client develop
an investment portfolio that is designed with a level of risk that he or she finds acceptable. (Please note
that asset allocation is a long-term approach to investing and that financial planning services generally do
not include advice regarding “market timing” (i.e., short-term reallocations among asset classes)).
Retirement and Distribution Planning
Retirement Planning helps a client plan for retirement. The Financial Professional may provide the client
with a current estimate of future retirement income and expenses and can illustrate potential savings and
investment combinations to help the client meet his or her retirement needs.
Distribution Planning helps a client understand actions required to transition into retirement. This may
involve significant repositioning of assets, addressing timing issues and reviewing risk tolerance in order
to provide adequate income and financial security during the client’s retirement years. The client may also
receive analysis to help him or her understand and evaluate options for plan distributions, Social Security,
work, leisure, health care and other decisions.
Education
This service helps clients plan for funding sources and expenses related to education. A Financial
Professional can provide the client with solutions for existing assets, income, savings, and funding options
that can be designated toward achieving the client’s or his or her dependents’ educational goals.
Estate Planning
This service will help you prepare for passing wealth to your beneficiaries in an efficient manner. It may
include an analysis that provides an estimate of estate settlement costs and the possible remainder of
your estate(s) that could be passed on to heirs. Your Financial Professional will propose options to help
manage costs, leave a legacy, and provide for others. In addition, your Financial Professional can assist
your attorney in the settlement of an estate.
Stock Options
This service provides clients with multiple strategies to consider in exercising employment-based non-
qualified and incentive stock options. This may include portfolio analysis intended to help the client
determine the appropriate time to exercise options given risk and reward considerations and to illustrate
the after-tax effects of exercise and sell strategies while considering tax and cash flow efficiency.
Income Tax Planning
This service is intended to address general tax considerations for financial services products, transactions,
and ownership structures. Working with a client’s tax professional, a Financial Professional can also help
identify options related to financial planning strategies and goals. This service may also analyze various
strategies for tax efficient withdrawals from tax- deferred accounts and to minimize the taxation of Social
Security income. Neither Equitable Advisors nor a Financial Professional provides tax or legal advice under
this planning service (or any other financial planning service we offer).
Major Purchase Planning
Major Purchase Planning seeks to identify annual and monthly savings needed for various goals such as
making a large purchase (e.g., a second home) and/or other income sufficiency needs. This service may
also analyze different personal financial choices such as spending less for the major purchase, saving more
for the major purchase, and adjusting the timing of the major purchase. This may include an analysis of
your current financial position relative to a level of income sufficient for various other major purchase
goals you have identified.
Divorce Planning
This service is designed to propose strategies for one party to a divorce to arrange for his or her personal
finances during a divorce. This service may include a divorce financial plan, which is designed to assist the
individual client (one of the divorcing parties) and his or her attorney in evaluating the long-term financial
consequences of proposed divorce or settlement options.
This service does not recommend a preferred divorce settlement option. Additionally, any illustrations
regarding ownership of assets or division of assets and liabilities are for educational purposes only and
are not recommendations; all decisions regarding such matters should be made by the client and his or
her attorney. Note that any documents, analyses, and other reports provided, and statements made, by
a Financial Professional in providing the divorce planning service may be discoverable by another party to
the proceeding; a client should consult with his or her attorney regarding such issues. The client’s
attorney, not the Financial Professional, is the legal advocate on the client’s behalf.
Assumptions, Projections, and Estimates are not Guaranteed
Projections in financial plans or advice are based on numerous assumptions as to future conditions,
including interest rates, inflation rates, income tax rates, Social Security benefits, and returns on
investments. Such projections are intended to help the client:
• estimate amounts needed to fund specific future goals (e.g., education funding, retirement, etc.),
and
• develop appropriate strategies to meet these goals.
Since projections are dependent on future events which cannot now be known, there is no assurance that
the projections or any estimates will be realized or, even if they are realized, will be sufficient to meet
future needs.
All projections and estimates are furnished for illustrative purposes only and are not predictions or
guarantees of the return on any assets that the client owns or could purchase. The Financial Professional
will work with the client to determine which “assumptions” should be used in developing financial
planning advice, so that any projections or estimates reflect the client's views and perspective on future
conditions and events. These assumptions may include the following:
• personal assumptions such as: retirement age, life expectancy, income needs, risk factors, time
horizon, and special needs; and
• economic assumptions such as inflation rates, tax rates, and investment returns.
.
The client’s assumptions related to acceptable risk levels may also be measured through the completion
of a risk tolerance questionnaire.
Clients are encouraged to review and update their plans or advice received periodically to take account
of changing conditions including, among other things, changes in their own circumstances, goals, or
objectives.
2. Seminars
Financial Professionals may conduct investment advisory seminars for employer-sponsored employee
meetings, specific client groups, or other types of group meetings. Seminars may cover many aspects of
financial planning, including risk management, cash management, investment planning, income tax,
retirement planning, and estate conservation. The fees charged for seminars are described in our
response to Item 5 – Fees and Compensation below.
Seminars will be general in nature and limited to educational and impersonal advice. The information a
Financial Professional provides at a seminar is not intended to address any attendee’s personal financial
situation, and attendees will not be obligated to implement any advice, recommendation, or information
they receive through Equitable Advisors or any other party.
Seminars provided to groups of employees are not intended as “employee benefits” covered by ERISA or
any other law. In addition, the limits on Equitable Advisors’ activities described below under “Retirement
Plan Investment Advisory Services” apply to any services provided to employees that participate in a
qualified retirement plan that is subject to ERISA or an IRA subject to applicable provisions of the Internal
Revenue Code of 1987, as amended (the “Internal Revenue Code”).
3. Corporate Financial Planning
Equitable Advisors may enter into written agreements with select corporate, institutional, or membership
organizations to provide planning services to their employees, partners, independent contractors, or
members. The fees, if any, in connection with these services are subject to negotiation between Equitable
Advisors and the organization. The negotiated fees may vary substantially from the fees described
elsewhere in this Brochure. Those receiving financial planning or other services under an institutional
agreement typically pay lower fees than those clients who otherwise enroll in personal financial planning
services.
The services provided by Equitable Advisors pursuant to corporate agreements are not intended as
“employee benefits” covered by ERISA or any other law. In addition, the limits on Equitable Advisors’
activities described below under “Retirement Plan Investment Advisory Services” apply to any services
provided to employees that participate in a qualified retirement plan that is subject to ERISA or an
individual retirement account (“IRA”) subject to the Internal Revenue Code.
4. Business Strategies Services
Equitable Advisors may also allow certain credentialed Financial Professionals to provide Business
Strategies Services, which include business exit planning and other business planning services. Business
Strategies services shall include providing certain educational modules to business owners to assist them
in accomplishing their objectives with regard to the realization and preservation of maximum business
value and personal wealth. The Financial Professionals utilize a client questionnaire to determine which
educational modules may be of value to the client.
E. Asset Management Programs
With respect to asset management services, we act (i) as a “promoter” (also called an “endorser” or
“solicitor”) or a “co-advisor” for third party program sponsors as part of a turnkey asset management
program (such sponsors referred to as “TAMPs”), or (ii) as the portfolio adviser or manager (or as an
adviser to the client in selecting a strategist or manager) on a third-party platform, generally through LPL,
including SAM and MWP (defined below), among others (“LPL Programs”).
1. Types of Advisory Programs offered through TAMPs and LPL Programs
• Mutual Fund Advisory Programs – a mutual fund program that allows investors to allocate their
assets across multiple mutual funds. These programs typically include elements such as client
profiling, fee-based pricing, and rebalancing.
• Exchange Traded Fund (ETF) Advisory Programs – managed account programs that allow investors
to allocate their assets across multiple ETFs. These programs include elements such as client
profiling, fee-based pricing, and rebalancing.
• Financial Professional as Advisor Programs – non-discretionary and discretionary fee based
advisory programs that enable investors to hold different types of securities (e.g., mutual funds,
ETFs, equities, fixed income, etc.).
• Separately Managed Account (SMA) Advisory – managed programs that utilize separate accounts
as the investment vehicle. These separate accounts are managed by a third-party money manager
and will contain individual securities such as equities and individual fixed income securities. These
can be traditional, where a single account corresponds to a single investment strategy, or multi-
discipline where the program offers multiple disciplines within the same separate account with
an overlay manager responsible for coordinating the multiple disciplines into a unified portfolio.
• Unified Managed Account – a single account that houses multiple investment products such as
separately managed account managers, mutual funds, and ETFs. The account utilizes a platform
that provides the ability to manage an investor’s assets in a comprehensive portfolio. In MWP,
the Financial Professional may serve as a strategist by designing models that, if selected by the
client, are implemented by LPL as overlay manager on a discretionary basis.
When clients invest through third party advisory programs it is typical that the program sponsor has the
authority to place trades on their behalf without consent (i.e., the program sponsor has “discretion”).
The following Sub-sections 2 and 3 provide a high-level description of the programs generally available
through Equitable Advisors. Sub-Section 3 specifically discusses our qualified plan and ERISA services,
including our ERISA fiduciary services. The following is not a full description of any program. Please refer
to the ADV Part 2A of the TAMP or Program Brochure of an LPL Program to determine the specifics of
each particular investment program, including information regarding separately managed accounts in
each program.
2. Referrals to TAMPs
As a promoter in referring clients to TAMPs, we act in accordance with the Advisers Act, including Rule
206(4)-1 thereunder (the “Marketing Rule”) governing paid testimonials or endorsements. These TAMPs
sponsor advisory programs and charge the client an advisory fee based on assets invested. The TAMP pays
Equitable Advisors a portion of that advisory fee. A few additional points regarding our role as promoter
for these programs:
• We will typically carry out various client interface activities in exchange for our fee, which may
include assisting the client in completing account opening paperwork, conducting an annual
meeting with the client to determine if the program remains suitable, and facilitating
communication between the TAMP and the client.
• Generally, the TAMP will be responsible for determining the specific investments and/or sub-
managers that are used to populate a client’s account. Our responsibilities and those of the TAMP
will be described in the client agreement for the program and the TAMP’s investment advisory or
program disclosure document, which we urge the client to read prior to investing.
• Your client agreement will generally be between you and the TAMP in question. Equitable
Advisors may or may not be a party to such agreement, depending on the program. In
circumstances where we, acting as a promoter, have referred you to a third-party asset manager
and maintain ongoing responsibilities with respect to your account, our mutual responsibilities
are described in a separate agreement entitled “Investment Adviser Agreement – Third Party
Programs” which can be found on our Disclosure Website
(https://equitable.com/CRS).
• In some cases, we will not have ongoing contact and responsibilities with respect to your account
after you are referred to a TAMP.
The following is a list of the TAMPs Equitable Advisors makes available to its clients and a brief description
of the programs we offer through them. For more information on these programs, including the applicable
account minimums (which generally range from $10,000 to $2 million), fees, expenses, and potential
conflicts of interest, please see the investment advisory or program disclosure document of the respective
program sponsor, which will be provided prior to opening an account.
a. TAMPs for which Equitable Advisors Maintains Ongoing Responsibilities
Under the following TAMP arrangements, Equitable Advisors maintains ongoing responsibilities –
primarily conducting an annual meeting with the client to determine if the program remains suitable and
facilitating communication between the TAMP and the client.
New Business Being Referred
Advisors Capital Management (“ACM”)
Equitable Advisors offers clients access to various investment advisory programs offered through ACM.
For each of the ACM programs (Model Separate Accounts and Private Account Strategies), the Equitable
Advisors Financial Professional works with you to complete the individual client questionnaire, which
allows ACM to determine the appropriate investment strategy recommendations to meet your
investment objectives. ACM’s investment strategies include Global Growth, Global Dividend, International
ADR, Small/Mid Cap Core, Growth, Core Dividend, Income with Growth, Balanced, Balanced Defensive
(Overlay) and Fixed Income.
Note that ACM may allow you to use funds from your advisory account offered through ACM to pay
premiums on life and annuity products, including products offered by Equitable Financial Life Insurance
Company, an insurance company affiliate of Equitable Advisors (along with Equitable Financial Life
Insurance Company of America; together, “Equitable Financial”), and third-party insurance carriers.
Equitable Advisors also offers ACM as an investment advisory option, called PathFinder, to provide
assistance in managing assets that retirement plan participants have elected to move into their self-
directed brokerage account (“SDBA”). The PathFinder program offers managed mutual fund strategies
that can be combined in different ways to reflect your specific investment objectives, taking your risk
tolerance and time horizon into account. For direct payroll contributions, ACM imposes no minimum
investment amount although your plan may limit how much money you can have in or contribute to your
SDBA.
AssetMark, Inc. (“AssetMark”)
AssetMark provides a variety of advisory programs to clients including Privately Managed Portfolios,
Multiple Strategy Portfolios, No Load Mutual Fund Portfolios, ETF Portfolios, Privately Managed Account
Solutions, Select Solutions, and Preservation Strategy. For each AssetMark program, a Financial
Professional consult with clients to assess their financial situation and identify their investment objectives
in order to assist the client in investing in portfolios designed to meet the client’s financial needs. Working
with their Financial Professional, clients select advisory service(s) and investment objective(s) available
within the program(s). AssetMark manages the assets based on a client’s individual financial
circumstances, investment needs and goals and level of risk tolerance.
Note that AssetMark may allow you to use funds from your advisory account offered through AssetMark
to pay premiums on life and annuity products, including products offered by Equitable Life Insurance
Company, an insurance company affiliate of Equitable Advisors, and third-party insurance carriers.
Boyd Watterson Asset Management (“Boyd Watterson”)
Boyd Watterson specializes in managing fixed- income portfolios, equity portfolios, and blended strategies
for individuals and institutions in a single strategy separately managed account program. Clients can
choose to utilize one of Boyd Watterson’s traditional investment options or a customized approach that
better fits their needs. Your Equitable Advisors’ Financial Professional works with you to determine which
of Boyd Watterson’s portfolios will help you meet your investment objectives.
Equitable Advisors offers clients access to portfolios managed by Boyd Watterson, a Titanium Asset
Management Company (formerly Sovereign Advisers). While Equitable Advisors offers clients the ability
to invest directly through Boyd Watterson, Boyd Watterson also provides separately managed accounts
through specific investment options in different programs offered through Equitable Advisors, such as
Lockwood’s Multi-Manager or LPL’s Manager Select.
Brinker Capital, Inc. (“Brinker Capital”)
Equitable Advisors offers clients access to various investment advisory programs offered through Brinker
Capital, Destinations Programs, Core Asset Manager, Unified Managed Account, and Retirement Plan
Services Program/Retirement Plan Services Plus. Brinker Capital’s Destinations program includes mutual
funds or ETFs, ETNs and mutual funds. For each of the Brinker programs, the Equitable Advisors Financial
Professional works with you to complete the individual client questionnaire, which allows Brinker to
determine the appropriate investment strategy recommendations to meet your investment objectives.
Morningstar Investment Services, Inc. (“MIS”)
Equitable Advisors offers clients access to a variety of investment advisory services available under MIS’s
Managed Portfolios program including MIS Mutual Fund Portfolios, MIS ETF Portfolios, MIS Direct
Indexing Portfolios, and MIS Select Equity and Fixed Income Portfolios. For each of the MIS programs, the
Equitable Advisors Financial Professional works with you to complete the individual client questionnaire
which allows MIS to determine the appropriate investment strategy recommendations to meet your
investment objectives.
Equitable Advisors also offers Morningstar as an investment advisory option to provide assistance in
managing assets that retirement plan participants have elected to move into their self-directed brokerage
account (“SDBA”). Morningstar maintains strategy specific portfolios and provides investment advice to
plan participants based on their client profile, including risk tolerance, investment objectives, time
horizon, financial goals, and personal and financial situation.
Nationwide Investment Advisors (“NIA”)
An overlay management service available for participants in certain Nationwide Resources Trust and
Innovator as well as Nationwide Clear Advantage and Flex Advantage qualified retirement plans through
NIA’s ProAccount program. The Rackmount program offers plan sponsors the opportunity to allow plan
participants to elect to use NIA to allocate the assets within their Nationwide qualified plan based upon
their investment objectives and
risk tolerance. NIA is an affiliate of Nationwide Financial, which offers the
Nationwide Resources Trust and Innovator Plans.
Financial Professionals who offer Nationwide qualified plans to their clients have the option of selecting
from one of the approved investment advisers pre-selected by Nationwide to provide advisory services
to plan participants.
PlanMember Securities Corporation (“PSEC”)
Equitable Advisors offers clients access to PlanMember Elite, an advisory program offered by PSEC, which
as noted below is an affiliate of Equitable Advisors. PSEC constructs a series of asset allocation portfolios
with varying risk profiles that are invested in mutual funds. PSEC primarily markets this program to
individual retirement plans. A data gathering questionnaire is undertaken to determine the client’s
financial situation and investment objectives. Services are based on the individual needs of the client.
PlanMember Elite has five portfolio models constructed with primarily index funds and another set of five
models constructed with both index and active funds. The portfolio model objectives range from
conservation of principal and inflation protection to maximum long-term growth.
In addition to Elite, PSEC may also provide advisory services to accounts that are opened through the
PlanMember OPTIFUND program. Similar to Elite, this program utilizes the same strategies; however, the
funds used within the models may differ. In addition to the advisory programs, PSEC also offers non-
advisory retirement plan accounts, subject to different fees and charges.
ProNvest, Inc. (“ProNvest”)
Equitable Advisors offers ProNvest as an investment advisory option to certain 403(b) plan sponsors and
participants in Equitable’s EquiVest variable annuity and PlanMember’s OPTIFUND programs. Through
this program, plan participants may choose to include ProNvest’s program as an additional feature for
their qualified plan. ProNvest is not affiliated with any of the firms that use its money management
services and participants are not obligated to choose ProNvest as a money manager for assets within the
403(b)accounts.
SEI Investments Management Corporation (“SIMC”)
Equitable Advisors offers clients access to various investment advisory programs offered through SIMC
including the Managed Accounts Program, Integrated Managed Account Program and Private Client
Mutual Fund Asset Allocation Program. For each of the SIMC’s programs, the Equitable Advisors Financial
Professional works with you to complete the individual client questionnaire which allows SIMC to
determine the appropriate investment strategy recommendations to meet your investment objectives.
Certain proprietary mutual funds may also be available from SIMC outside of an investment advisory
program. Different fees and charges may apply to such funds.
Note that SIMC may allow you to use funds from your advisory account offered through SIMC to pay
premiums on life and annuity products, including products offered by Equitable Life Insurance Company,
an insurance company affiliate of Equitable Advisors, and third-party insurance carriers.
The Pacific Financial Group (“TPFG”)
Equitable Advisors offers TPFG as an investment advisory option to provide assistance in managing assets
that retirement plan participants have elected to move into their self- directed brokerage account (SDBA).
TPFG provides investment advice to plan participants based on risk assessment questionnaires and
meetings designed to determine their goals and risk temperament (risk profile). TPFG can, at its sole
discretion, waive the minimum amount requirements.
Trek Financial, LLC (formerly “BCJ Capital Management”)
Equitable Advisors offers clients access to portfolios managed by Trek Financial, which uses a goal-based
investment approach. Your Equitable Advisors’ Financial Professional works with you to determine which
of Trek Financials’ portfolios will help you meet your investment objectives. The manager does not have
a stated minimum account size.
Program Sponsors Available Only on a “Service Only” Basis
In addition to the third-party programs listed above, Equitable Advisors allows certain of its Financial
Professionals to provide investment advisory services on a “service only” basis to clients with asset
management accounts held through certain TAMPs. “Service only” means we are not actively opening
new accounts with the TAMP for new clients but maintain certain responsibilities with respect to existing
clients’ accounts.
Please refer to the individual TAMP’s Form ADV Part 2A, or equivalent brochure, for a full description of
their products and services and all related terms, conditions, fees, and expenses. The following are the
service-only TAMPs for which Equitable Advisors provides certain continued advisory services (rather than
a pure referral) pursuant to its Third-Party Programs advisory agreement.
CLS Investments, LLC (“CLS”)
Equitable Advisors offers clients access to a variety of CLS’s advisory programs on a service only basis
including the CLS Nationwide Qualified Plans, Individualized Account Management Portfolios, AdvisorOne
Portfolios, ETF Portfolios and Master Manager Strategy Portfolio. Each of these programs offer advisory
services to clients and may include mutual fund investments, separate account management and ETFs.
Variable annuities will not be offered, although CLS does use these products in some of their portfolios.
Lockwood Advisors, Inc. (“Lockwood”)
Through certain Financial Professionals, Equitable Advisors offers clients access to various investment
advisory programs offered through Lockwood, including Lockwood Separately Managed Accounts,
Lockwood Investment Strategies and Lockwood Asset Allocation Portfolios on a service only basis. For
each of the Lockwood programs, the Equitable Advisors Financial Professional works with you to complete
a client questionnaire which allows Lockwood to determine the appropriate investment strategy
recommendations to meet your investment objectives.
Meeder Advisory Services, Inc. (“Meeder”)
The Meeder program offered through Equitable Advisors is designed for plan participants in qualified
plans offered through Nationwide Financial and is available for participants in the Nationwide Retirement
Resource program. Meeder established the program to manage mutual fund portfolios with the
investment disciplines that Meeder has been using with their retirement investors. Meeder has
established eight model portfolios for the program designed around different risk profiles and investment
objectives. In addition, they have established five target date portfolios that are designed around the
anticipated retirement date of the participant.
USA Financial Portformulas Corporation (“Portformulas”)
Through certain Financial Professionals, Equitable Advisors may offer the investment advisory programs
of Portformulas on a service-only basis. Portformulas offers different portfolio options designed for a
specific investment goal.
b.
Additional Asset Management Referral Arrangements
(i) Referrals Without Ongoing Advisory Services
Equitable Advisors may also refer investors to the investment advisory and asset management services of
various TAMPs under arrangements in which it does not provide any ongoing investment advisory services
to the referred party regarding the account after the referral. These TAMPs to which Equitable Advisors
continues to refer business (rather than on a “service-only” basis) are Silvercrest Asset Management
Group, which acquired certain assets of Jamison Eaton & Wood, Hightower Advisors, LLC, The Colony
Group, Raymond James Financial Services, Forefront Analytics – GKFO, UBS Financial Services, Wells
Fargo, LLC, Sentinel Pension Advisors, Corient Private Wealth, LLC, SEI Global Institutional Group, Burnham
Gibson Wealth Advisors, LLC,2 and Shuster Advisory Group, LLC.3 Equitable Advisors (and its Financial
Professional(s)) are compensated for referrals to these TAMPs from a portion of the advisory fee paid by
the referred party to the TAMP.
All investment advisory services regarding the client’s account will be provided by such TAMPs pursuant
to an agreement between the client and the specific TAMP. See the Form ADV Part 2A of the specific
TAMP for more information on its investment advisory practices.
(ii) Referrals to Our Affiliate BPWM
Equitable Advisors may refer clients to the investment advisory and asset management services of an
Equitable Advisors’ affiliate, Bernstein Private Wealth Management (“BPWM”), a unit of AB. Equitable
Advisors (and its Financial Professional(s)) are compensated for referrals to BPWM and do not provide
any investment advisory services to the client regarding the BPWM account. All investment advisory
services regarding the client’s BPWM account will be provided by BPWM pursuant to an agreement
between the client and BPWM. See the Form ADV Part 2A of BPWM for more information on its
investment advisory practices.
(iii) EquiVest Plan Participant Referrals to ProNVest and PlanMember
Equitable Advisors may also refer EquiVest variable annuity plan participants to the investment advisory
and asset management services of ProNVest for management of their variable annuity sub-accounts at
Equitable. Equitable Advisors (and its Financial Professional(s)) are compensated for referrals to ProNVest
and do not provide any investment advisory services to the client regarding the ProNVest account. All
investment advisory services regarding the client’s ProNVest account will be provided by ProNvest
pursuant to an agreement between the client and ProNVest. Equitable Advisors only engages plan
participants for referrals, and not the plan sponsors. ProNVest is not an affiliate of Equitable Advisors or
Equitable or any of their affiliates. See the Form ADV Part 2A of ProNVest for more information on its
investment advisory practices.
Equitable Advisors may also refer participants in the PSEC 403(b)7 programs for advisory and management
services of their mutual fund holdings with PSEC, an affiliate of Equitable Advisors.
3. LPL Programs
a. LPL Financial Generally
Equitable Advisors offers clients access to various investments advisory programs offered through LPL
Financial (“LPL”). Additionally, Equitable Advisors has other relationships with LPL. LPL acts as Equitable
2 Certain Equitable Advisors Financial Professionals are investment adviser representatives and/or owners of Burnham
Gibson Wealth Management.
3 Certain Equitable Advisors Financial Professionals are investment adviser representatives and/or owners of Shuster
Advisory Group, LLC.
Advisors’ securities fully disclosed clearing firm for broker-dealer products and services, and also provides
back- and middle-office services through a services agreement between the companies.
LPL in certain instances reimburses Equitable Advisors for loans it makes to newly associated Financial
Professionals to assist them with the costs relating to transitioning their businesses to Equitable Advisors.
These relationships and payments can create a financial incentive to recommend that a client open and
maintain an account with Equitable Advisors and LPL for certain advisory services.
As a result, there are potential and actual conflicts of interest associated with the compensation to LPL
for services to Equitable, and the division of compensation between the two firms for services to clients
(see also Item 14). These conflicts and implications for the client are discussed in greater detail in the
relevant LPL Program Brochure. Equitable Advisors addresses these conflicts of interest by disclosing them
to you as well as through training, tools, and processes to ensure our Financial Professionals’
recommendations are in the client’s best interest, and through supervisory oversight designed to ensure
that each recommendation meets all regulatory requirements.
In LPL accounts, clients also have the opportunity to utilize the services of Private Trust Company (“PTC”).
PTC is a wholly owned subsidiary of LPL Financial and is not affiliated with Equitable Advisors. PTC provides
a variety of trust services. The option of using PTC is the decision of the client. Equitable Advisors Financial
Professionals cannot provide legal or tax advice in conjunction with the trust services available through
PTC and clients are encouraged to consult with their legal and tax advisors prior to selecting PTC as their
provider for trust services. Equitable Advisors Financial Professionals are not compensated for the use of
trust services.
Clients that have selected PTC as their trust provider may choose to invest the trust assets in any of the
advisory programs available through LPL Financial. Equitable Advisors Financial Professionals will assist
the client in selecting a program appropriate for their investment needs. They will receive compensation
for this assistance as discussed further in Item 5.
As a convenience to clients, certain of the LPL advisory programs and brokerage accounts may offer the
ability to access funds through ACH instructions, wires, and other transfers. The security of customer
accounts is our paramount concern and if at any time such security may be jeopardized by using ACH
instructions, wires and other transfers, these features may be terminated by Equitable or LPL. Equitable
and LPL each reserve the right to refuse any directive or instruction relating to ACH, wires, or transfers in
their sole discretion.
In addition to the programs listed below, LPL provides collateralized lending services through certain
federally chartered savings bank(s), on accounts for which LPL serves as the program sponsor. Please be
aware this raises conflicts of interest that are discussed in your LPL Program Brochure.
Clients should carefully review the program brochure of all LPL Programs (and TAMPs) before investing.
b. LPL Programs
Equitable Advisors offers clients access to various investment advisory programs offered through LPL.
These programs are discussed briefly below. The SAM program and certain disclosures regarding MWP
(when a Financial Professional is designing the model for his or her clients) are discussed in subsections
(c) below.
•
Optimum Market Portfolios (“OMP”) – a professionally managed mutual fund advisory program
using Optimum Funds Class I shares. Your Equitable Advisors Financial Professional works with
you to complete a client questionnaire which allows LPL to determine the asset allocation to meet
your investment objectives.
•
Personal Wealth Portfolios (“PWP”) - is a unified management account in which LPL, with
assistance from sub-advisors it has selected, directs, and manages specified client assets on a
discretionary basis. Your Equitable Advisors Financial Professional works with you to determine
which of the sub-advisors will work with your individual investment objectives.
•
Manager Select – a separately managed account program where the client, with the assistance of
their Financial Professional, will select the managers and develop an asset allocation.
•
Model Wealth Portfolios (“MWP”) – a unified managed account program that provides clients
with access to managed portfolios of securities (which may include mutual funds, ETFs, exchange
traded notes or “ETNs” and closed end funds) created and designed by LPL’s in- house research
team (“LPL Research”), a third-party investment strategist (an “Outside Strategist”),4 or (if
available) an Equitable Advisors Financial Professional (referred to as MWP Advisor Sleeve)—or a
third-party registered investment adviser of which certain Equitable Advisors Financial
Professionals are principals and/or investment adviser representatives5—with oversight from the
LPL Financial Overlay Portfolio Management Group (the “LPL Overlay Manager”). Your Equitable
Advisors Financial Professional works with you to determine which of the allocation strategies,
called “models,” will work with your individual investment objectives. The Equitable Advisors
Financial Professional may recommend that you choose more than one strategist within a single
MWP account.
In connection with any of these programs, our Financial Professionals may from time to time retain third
party economists, analysts, or consultants to develop model portfolios, provide financial or economic
research and data, develop capital markets assumptions, interpret, and analyze economic and financial
data sets and trends, develop economic models, or otherwise support the investment advisory services
provided by the Financial Professionals under these programs.
c. Financial Professional as Portfolio Advisor
Equitable Advisors and its Financial Professionals provide portfolio management and/or strategist services
to our clients in the following programs: LPL’s SAM program and LPL’s MWP Advisor Sleeve program. In
the SAM program, the Financial Professional recommends a portfolio of securities for the client to invest
in, and will do so in the context of MWP Advisor Sleeve.
4 Two of the Outside Strategists, AB and Equitable Investment Management (the brand name for Equitable Investment
Management Group, LLC which, among other things, serves as the investment adviser to the 1290 Funds, as discussed in Item 10,
below) are affiliates of Equitable Advisors. Equitable Investment Management has not met all of the LPL selection and review
criteria that LPL applies to other portfolio strategists. See LPL’s MWP Program Brochure for additional information regarding
available portfolio strategists.
5 For example, LPL makes available as an accommodation to Equitable Advisors portfolios created and designed by PST
Advisors Inc. (“PST”). PST has not met the LPL selection and review criteria that LPL applies to other portfolio strategists.
In all other programs any portfolio management services are provided by the program sponsor and/or its
delegate. Equitable Advisors receives a portion of the advisory fee for the services it provides in all such
programs. This is described in more detail in Item 5 - Fees and Compensation. In certain rare
circumstances, we have as an accommodation entered into advisory relationships in which the Financial
Professional acts as portfolio manager with respect to assets held on a platform other than LPL.
(1) SAM Program Accounts
(a)
SAM Accounts Generally
In most cases, portfolio management services for SAM accounts are provided on a non-discretionary basis,
which means the client must approve all transactions prior to execution. In some instances, with client
written consent, a Financial Professional may provide advisory services for a SAM account on a
discretionary basis (
see Item 16 – Investment Discretion).
In a SAM account, the client and the Financial Professional can agree that (1) the client pays applicable
ticket charges6 for transactions in the account, or (2) the Financial Professional pays the ticket charges.
These ticket charges are not considered brokerage commissions. In SAM accounts, the Financial
Professional serves as portfolio adviser on a non-discretionary basis where clients may purchase and sell
securities and/or liquidate previously purchased load mutual funds (e.g., equities, fixed income, options,
no-load and load waived mutual funds, variable annuities, and ETFs) pursuant to investment objectives
chosen by the client. In some cases, the client may provide discretionary authorization to the Financial
Professional, provided the Financial Professional is pre-approved by Equitable Advisors to offer
discretionary trading. (See Item 16 below.)
Financial Professionals may also recommend structured products in SAM accounts. These structure
products typically take the form of bonds called “Structured Notes,” although some structured products
are Certificates of Deposit (“CDs”).
Variable annuities available on the SAM platform are proprietary to Equitable Life Insurance Company, an
affiliate of Equitable Advisors. Financial Professionals will not receive up front commissions for
recommendations of Equitable proprietary variable annuity products in SAM accounts but will receive an
ongoing fee commensurate with any SAM investment as described more fully below in “Item 5 – Fees and
Compensation.” In addition, the 1290 Funds and AB Funds, each a proprietary mutual fund family, may
also be recommended in SAM accounts, as well as in brokerage accounts. Equitable Advisors and its
Financial Professionals may receive other compensation and benefits related to recommendations of
proprietary products. Accepting this type of compensation presents a conflict of interest in that there is
an incentive to recommend investment products based on the compensation received, rather than on a
client’s needs. We disclose potential conflicts of interest to clients through documents such as this
disclosure document, the prospectus, the LPL Program Brochures, and other materials discussing the
products and services offered, as well as in our General Conflicts of Interest Disclosure, which is provided
at account opening and is available a
t https://equitable.com/CRS.
6 Ticket charges are fees charged by the broker-dealer (in this case LPL) for executing trades.
The client should consider these additional payments and the potential conflicts of interest they create
carefully prior to investing in any securities or through any asset management programs available through
Equitable Advisors. The client is encouraged to ask his or her Financial Professional for additional
information should he or she have any questions regarding these payments or the potential conflicts of
interest they create. Furthermore, clients can refer to the prospectus or Statement of Additional
Information for the specific variable annuity or mutual fund for more information regarding the additional
compensation the Financial Professional may receive.
The advisory services carried out by the Financial Professionals are completed in their capacity as IARs of
Equitable Advisors; however, when recommending variable annuity products, the Financial Professional
acts in his or her capacity as an insurance agent of Equitable Network (an affiliate of Equitable Advisors)
and/or its affiliates.
(b)
Alternative Investments in SAM Accounts
Equitable Advisors and select Financial Professionals make available certain alternative investments to
advisory clients in SAM. These alternative investments include managed futures, business development
companies (“BDCs”) and real estate investment trusts (“REITs”), which are all considered to be alternative
investment products due to their non-traditional composition. See Section 4, below, for a discussion of
alternative investments, including those available through SAM accounts.
(2) MWP Advisor Sleeve Program
In MWP Advisor Sleeve, the Financial Professional on a non-discretionary basis recommends a strategist
or strategists and model(s) designed by the strategist(s), and LPL implements the models in the client’s
account on a discretionary basis. In some cases, the Financial Professional designs models as a strategist
in MWP for his/her clients.
Due to the existing arrangements between LPL and Equitable Advisors under which LPL provides clearing,
back-office, and middle-office services to Equitable Advisors, LPL offers portfolios created and designed
by Equitable Advisors Financial Professionals. When LPL offers such portfolios, the Equitable Advisors
Financial Professionals are not subject to the LPL selection and review criteria that LPL applies to other
portfolio strategists in MWP. This means that LPL would not subject the Equitable Advisors Financial
Professionals to the due diligence and screening criteria it applies to other portfolio strategists. Clients
wishing to use an Equitable Advisors Financial Professional as a strategist should bear this in mind and
should not think that the availability of their Equitable Advisors’ Financial Professional as a strategist on
the LPL platform means that LPL has vetted, assessed, or approved of their abilities, experience, or
portfolio management acumen.
It is important that clients speak to their Equitable Advisors Financial Professional serving as a strategist
on LPL’s platform to understand the investment strategies and techniques they intend to utilize, the
associated risks, and their approach to asset allocation, diversification, risk management, portfolio
monitoring, and rebalancing. Clients should also be comfortable with their Equitable Advisors Financial
Professional’s experience in managing portfolios, the basis of their research, their buy and sell criteria,
and the resources they are able to dedicate to serving as a strategist.
As set forth more fully in the MWP account documentation, clients should be aware of three fees that are
charged in connection with the MWP account: the Advisor Fee, the Strategist Fee, and the LPL Program
Fee.7 These fees are separate from one another and pay for distinct services rendered.8 When a Financial
Professional is acting as a strategist under MWP Advisor Sleeve, the Advisor Fee is for the investment
advisory services of Equitable and the Equitable Advisors Financial Professional and may not exceed 2%.
The Strategist Fee is a fee for the model portfolio design services of a strategist, and ranges from 0% to
0.25%.9 The LPL Program Fee is for the investment advisory, administrative, trading, and custodial services
of LPL, and ranges from 0.08% to 0.35%.10
The Strategist Fee and LPL Program Fee referenced in this paragraph may change from time to time, upon
thirty (30) days’ prior notice to clients.
4. Alternative Investments
Alternative investments such as managed futures, BDCs, and REITs may be purchased in SAM accounts, in
Equitable Advisors’ brokerage accounts, and in certain TAMP or LPL Programs.
Managed futures are products in which professional money managers’ direct investments in the global
currency, interest rate, equity, metal, energy, and agricultural markets. They do this through the use of
futures, forwards, and options.
A BDC is a type of pooled investment company that is registered under Section 54 of the Investment
Company Act of 1940, as amended (the “1940 Act”), rather than as an open-end or closed-end investment
company. A BDC invests primarily in certain qualifying private companies and must satisfy certain asset
composition and other thresholds and requirements under the 1940 Act. BDCs facilitate the flow of capital
to private companies and provide retail investors with exposure to the private equity and private debt
investment markets.
A REIT is a company that owns, and in most cases, operates income-producing real estate, such as
apartments, shopping centers, offices, hotels, etc. Some REITs also engage in financing real estate.
These alternative investments sold within an advisory program such as SAM will not incur an up-front
sales charge to the client for the sale. Equitable Advisors and its Financial Professional(s) will, however,
receive compensation from the advisory fees on the value of all of the assets held within the client’s SAM
account, including the value of any managed futures products, BDCs, or REITs.
7. Where PST is the strategist and the Equitable Advisors Financial Professional assigned to the account is a principal of
PST, the Equitable Advisors Financial Professional would receive the Advisor Fee and, indirectly, the Strategist Fee or a portion of
that fee. Where the Equitable Advisors Financial Professional assigned to the account is the strategist, the Strategist Fee is 0% as
the Advisor Fee is presumed to include compensation for such services.
See fn. 5.
8 Please note that MWP accounts remaining under a legacy fee structure (those accounts opened before January 1, 2016,
that have not converted to the new fee structure described above, where the fees are separated) are charged one aggregate
Account Fee, which was negotiated between the client and the Equitable Advisors Financial Professional and set out in the MWP
account documentation.
9 Where PST is the strategist and the Equitable Advisors Financial Professional assigned to the account is a principal of
PST, the Equitable Advisors Financial Professional would receive the Advisor Fee and, indirectly, the Strategist Fee or a portion of
that fee. Where the Equitable Advisors Financial Professional assigned to the account is the strategist, the Strategist Fee is 0% as
the Advisor Fee is presumed to include compensation for such services.
10 The Strategist Fee and LPL Program Fee referenced in this paragraph may change from time to time, upon thirty (30)
days’ prior notice to clients.
Equitable Advisors also may offer qualified investors access to certain investment companies exempt from
registration as investment companies under the 1940 Act, primarily through LPL. These include hedge
funds, fund-of-hedge funds, and exchange funds structured as limited partnerships or limited liability
companies. Equitable, in its capacity as a registered broker-dealer, and its Financial Professionals, acting
as broker-dealer registered representatives, may act as promoters for certain of these funds. Hedge fund
and fund of hedge fund interests are not available in the SAM program or any LPL Programs. Please review
the Offering Memorandum or Prospectus of the hedge fund or fund of hedge funds for more information,
as the terms of each offering may differ, as well as certain fees and charges that may be applicable.
Certain alternative investment products (plus some structured notes and CDs that may also be available
in SAM accounts) have a short to intermediate maturity – generally less than five years, although some
may go as long as fifteen years. Purchasing a product with a long period until maturity in an advisory
account may result in higher compensation to a client’s Financial Professional than if the product is
purchased directly or in a brokerage account.
Similarly, non-exchange traded REITs and BDCs are generally illiquid because there is no trading market
for the shares. While such non-traded REITs and BDCs may offer repurchase programs, they ordinarily
impose significant conditions and restrictions on such programs. The holding periods on non-traded REIT
and BDC investments vary and may require holding periods of ten (10) years or more. Therefore, non-
exchange traded REITs and BDCs may result in higher compensation to your Financial Professional than
products that have a readily available market. Certain non-traded REITs, known as “daily NAV programs”,
may offer greater liquidity to investors, generally on a quarterly basis. These are long-term investments,
and investors should be aware that liquidity is not guaranteed at any time.
Managed futures products involve significant risks as they are speculative and volatile in nature because
they invest in derivative products such as futures and options.
Alternative investments purchased in advisory accounts do not carry a sales commission; however,
Equitable Advisors receives a portion of the dealer manager fee that is paid on alternative investment
accounts, including assets held within advisory accounts. Furthermore, they are subject to the ongoing
asset management fee agreed upon between the client and Equitable Advisors.
Equitable Advisors may make the same, similar, or different alternative investments available for purchase
through a Financial Professional in his/her capacity as a broker-dealer registered representative of
Equitable Advisors. If such alternative investments are purchased through the broker-dealer channel,
different fee structures will apply; for example, Equitable Advisors and its Financial Professionals will
receive a sales commission, as described in the investment’s offering memorandum. Equitable Advisors
and its Financial Professionals may have a financial incentive to recommend purchasing an investment in
one of these structures (advisory or brokerage) over another. Under certain conditions, including length
of time that the product is held, a client may pay a higher sales charge in a commission-based product, or
may pay more in an advisory account which is subject to an ongoing fee based on assets under
management. Other factors may also affect how much a client pays in either an advisory or brokerage
structure.
In connection with any alternative investment decision, as with any securities investment decision, a client
should consult his or her Financial Professional for more information regarding the different fee and
commission structures that may apply depending upon whether the client purchases the investment
product in an investment advisory program or in a broker-dealer account. As part of the analysis, a client
should consider and discuss in particular his or her investment time horizon and overall likely costs before
making a decision about what type of relationship (i.e., brokerage vs. advisory) is appropriate for the
investment. A client should also determine whether it is prudent to consult his or her own legal, tax, and
accounting advisors in connection with alternative investments.
“Complex” investment products (
e.g., sector funds, structured notes and leveraged ETFs) and alternative
investments (e.g., managed futures, non-traded REITs, and BDCs) are generally viewed as difficult for
average investors to understand and they typically invest, in whole or in part, in non-traditional
(“alternative”) strategies or instruments. These products are often speculative, have high portfolio
management fees, carry higher or unique risks (
e.g., valuation risk, commodity risk, and lack of liquidity)
and require additional investor experience when compared to traditional investments.
Before purchasing a complex or alternative investment, a client should carefully read its offering
memoranda or prospectus and supplements and discuss it with his or her Financial Professional and, if
the client deems it appropriate, his or her legal and tax advisers.
5. Retirement Plan Support and Fiduciary Advice
a.
Retirement Plan Investment Advisory Support Services
Equitable Advisors may enter into agreements with sponsors of retirement plans to provide general
retirement plan management education and support services (the “Retirement Services”) to the plan
sponsor and/or plan participants in exchange for a fee, further information about which is provided in