Our Firm
Andersen (formerly known as WTAS LLC) was formed in 2002 to provide a wide
range of tax, valuation, financial advisory and related consulting services to
individuals and entities. Andersen Tax Holdings LLC wholly owns Andersen Tax
LLC. MD Investment LLC is the principal owner of Andersen Tax Holdings LLC.
Our Managing Directors are also the owners of our parent company.
Our Investment Consulting Services
This brochure primarily describes our investment consulting services business.
Our investment consultants provide individualized investment advice tailored to
the needs of each client. As such, the range of services and advice we provide can
vary from client to client. We primarily offer three types of services: Full-service
investment consulting, limited professional consulting, and performance
measurement and reporting. Each of these is offered as a stand-alone service or
can be integrated with our tax consulting and other services as part of a
comprehensive wealth management service. The exact services provided are
agreed to and detailed in a written engagement letter. As a non-discretionary,
non-custodial advisor, we do not directly make investments without clients’ prior
knowledge and authorization. Clients are free to implement all, some, or none of
our investment recommendations.
Full-Service Investment Consulting and Comprehensive Wealth
Management
In a typical full-service investment consulting engagement, we first work with a
client to develop an overall investment strategy. We initially analyze the client’s
financial goals, investment objectives, time horizon, income and cash flow
requirements, investment risk tolerance and other preferences. For some clients,
this includes advice regarding capital sufficiency and cash flow, retirement
planning, tax planning, estate planning, education funding, insurance needs, and
employer benefit decisions. The result of this overall analysis serves as the
foundation for the client’s strategic investment plan.
Next, we help design a portfolio consistent with the client’s strategic investment
plan. We create an asset allocation plan that seeks to provide a target rate of
return without exposure to levels of risk in excess of that needed to attain the
client’s financial goals. We seek to reduce overall risk by diversifying across major
asset classes and across investment styles within each asset class.
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Our recommendations vary based on each client’s financial goals and portfolio
size. For example, in a relatively smaller or more conservative portfolio we might
recommend specific allocations to cash equivalents, municipal and taxable bonds,
and U.S. and non-U.S. equities. For a larger or more aggressive portfolio we
might additionally recommend specific allocations to non-U.S. fixed income,
Treasury Inflation Protected debt, high yield debt, emerging markets debt and
equity, real estate, commodities, and alternative investments. To further
diversify a portfolio, we typically recommend allocations to various investment
styles or strategies within an asset class. A common example is splitting the large
capitalization domestic equity allocation among growth, core, and value
investment styles.
After formalizing the client’s strategic investment plan and asset allocation plan
in a written investment policy statement, we recommend unaffiliated separate
account managers, mutual funds, and other registered or unregistered
investment vehicles that we believe will perform well in their respective asset
class and investment style. (See Item 8 for more on how we select managers and
funds.)
Upon recommending separate account managers or funds and obtaining client
consent, we arrange for the execution of the approved investment. In some cases,
clients need to enter into an agreement directly with the separate account
managers we recommend. We assist with setting up these arrangements, as well
as other client-approved transactions such as transferring assets between
accounts. We also help the client select and coordinate third party custodial and
brokerage services and assist in selecting the appropriate account structure for
holding investment assets.
Once the investment plan has been implemented, we regularly and continuously
monitor the client’s portfolio and the separate account managers, mutual funds,
and other registered or unregistered investment vehicles that we recommended.
We advise the client whenever we no longer recommend a manager, fund, or
other investment vehicle and suggest a replacement. We prepare consolidated
performance reports that compare the client’s portfolio
to the strategic
investment plan and target allocation. We also compare the selected managers
and funds to appropriate market indices and peers within each asset class and
investment style. We meet with the client periodically to review the plan and the
separate account managers, funds, and other investments in the portfolio. We
recommend transactions to rebalance the portfolio back toward its target asset
allocation.
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As of December 31, 2023, our assets under advisement for this type of service was
approximately $4,963,236,000.
Limited Professional Consulting
For some clients, we perform only certain portions of the full-service investment
consulting described above, such as developing an investment policy statement or
strategic asset allocation. Other common examples of the types of limited
professional consulting we provide include:
• Performing a limited portfolio review or providing a second opinion of an
existing portfolio managed by another financial advisor
• Analyzing and conducting due diligence on a separate account manager,
fund, or other investment that the client is considering or has invested in
• Providing financial counseling services to key executives of a company, or
providing financial planning seminars and other educational services to
groups of employees
• Advising in a Co-Advisory arrangement in which we provide ongoing
strategic investment planning and overall portfolio monitoring while an
unaffiliated third-party advisor has full discretion as to selection of
separate account managers, funds, and securities
In these limited engagements, although we are providing investment advice as to
matters such as financial planning, asset allocation and performance
comparisons, the underlying investments are generally not based on our
recommendations. As such, we are not providing regular and continuous
oversight or recommendations about the merits of the underlying investments
unless specifically agreed to.
Performance Measurement and Reporting
For some clients, we provide only periodic investment reporting. We provide
performance reports that consolidate client holdings and accounts held across
multiple custodians. The separate account managers or other investments
underlying the portfolio are generally not based on our recommendations.
Instead, our advice is limited to providing commentary on the client’s
consolidated asset allocation and comparing managers or mutual funds to
appropriate benchmarks and peers. Like the limited professional consulting
service described above, we are not providing regular and continuous oversight
or recommendations about the merits of the underlying investments unless
specifically agreed to.
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Limits on Types of Investments We Recommend
Clients may place reasonable restrictions on investing in certain securities or
types of securities. These restrictions, if any, are documented in the investment
policy statement.
We generally do not recommend individual stocks or bonds (other than shares of
registered or unregistered funds) or specific industry sectors. We focus on
recommending separate account managers and registered investment vehicles
such as mutual funds and exchange traded funds. These separate account- and
fund managers select individual securities within their agreed upon investment
mandate. They invest on a discretionary basis and have their own limitations on
the types of investments in which they invest. You can review the separate
account- and fund managers’ limits on the types of investments in which they
invest in their disclosure brochures or offering documents.
Although we generally do not recommend individual securities or industry
sectors, we are available to assist clients with a broad array of investments,
including options, equity and debt securities, and alternative investments.
Individual security or sector recommendations are prompted by a client’s
particular needs, such as planning for income, capital gains, estate and gift taxes,
portfolio diversification, or hedging of concentrated positions. For example, we
may recommend that a client sell, or donate to charity, a specific security for
financial or tax planning reasons. As another example, we may express an
opinion on a manager, fund, or other security that a client independently
identified or bought. Such investment advice and recommendations are often
based primarily on asset allocation or financial and tax planning considerations
and do not reflect a view as to the intrinsic merits of the specific security as an
investment unless specifically agreed to.