Form ADV Part 2A, Item 4
Beck Capital Management LLC (referred hereinafter to as
“Advisor”) offers personalized investment advisory services to
clients. Advisor’s investment philosophy centers around a method
called Sector Rotation. It begins with a macro-economic view of
the world. As economies cycle, different sectors of those economies
have distinct advantages, while others move from favor to
disadvantage. Advisor will look further into the qualities of the
specific investments within the favored sectors in an attempt to find
value relative to the amount of risk and potential reward.
Mr. James “Frank” Beck is Chief Investment Advisor and the
principal owner of Beck Capital Management LLC established as
Capital Financial Group in 1997 and incorporated as Beck
Capital Management LLC in 2009. Mr. Beck makes most of the
portfolio investment decisions, with help from analysts Victor Beck
and Hunter Beck, for Beck Capital Management, LLC’s client and
advisor brokerage accounts. If Frank is unable to or unavailable
to make necessary decisions Victor Beck, VP of Investment
Research, Hunter Beck & Bill Gregory (Chief Compliance Officer,
VP Operations) will make the final decisions. Advisor
representatives may from time to time make trades in client
accounts if Frank is unavailable. These are usually client requested
or they need to create cash for a withdrawal.
Mr. Beck’s education and business background is provided below:
Bachelor of Science – University of Texas, 1977
Beck Capital Management LLC,
Managing Member
12/2009 – Present
Partnervest Advisory Services LLC 07/2005 – 02/2010
(Doing business under the name Capital Financial Group)
Frishberg, Jordan & Stewart Advisory Services LLC
(Doing business under the name Capital Financial Group)
02/1998 – 07/2005
JP Securities (Doing business under the name Capital
Financial Group)
09/1997 – 08/1998
MONY Securities 05/1987 – 08/1997
Computer Consultants Inc., President 07/1983 – 04/1987
Advisor provides asset management services defined as giving
continuous investment advice to a client and making investments for
the client based on the individual needs of the client. Through this
service, Advisor offers a highly customized and individualized
investment program for clients. A specific asset allocation strategy
and investment policy is crafted to focus on the specific client’s
goals and objectives. Advisor typically constructs portfolios
consisting of some of the following securities: equity securities,
corporate debt securities, municipal securities, mutual funds,
structured notes, private credit, private equity, exchange traded
funds, United States government securities., publicly traded REIT’s,
publicly registered non-traded REIT’s and publicly registered non-
traded Business Development Companies.
As part of its asset management services, Advisor provides clients
with financial planning services that may be specific or modular in
their preparation (unique to each client in their depth of
preparation). Topics included as part of the financial planning
services may include the following: organization and assessment,
retirement planning, education planning, long-term care, insurance
planning, debt management, investments, tax planning, estate
planning, and life events.
Advisor does not charge a separate or additional fee for financial
planning services provided as part of its asset management
services. Planning services are provided on request from the client
or if recommended by the advisor because of a specific need.
Advisor offers a customized and individualized investment
program for clients. A specific asset allocation strategy and
investment policy is crafted to focus on the specific client’s cash
flow needs and risk tolerance. The client may impose restrictions
on investing in specific industries and/or securities. The client may
also request that certain securities be purchased for their own
account.
Advisor provides discretionary investment advice through model
investment portfolios.
Type 1 = Ultimate Conservative. This type of portfolio holds cash
& cash equivalents. In nearly all instances, when a client seeks this
type of long-term investment posture, we refer them to a bank or
similar institution to invest solely in Certificates of Deposit, US
Treasury Notes,
US Treasury Bonds, or similar instruments.
Type 2 = Conservative. This type of portfolio typically holds a
mix of common stocks, preferred shares, ETFs, REITs (traded & non-
traded), corporate bonds, municipal & treasury bonds, precious
metals, alternatives, and cash & cash equivalents. A type 2
portfolio holds a larger percentage of blue-chip, large-cap
common stocks with lower betas than our more aggressive
portfolios. This type of portfolio may also hold growth stocks, but
in a smaller percentage than our more aggressive portfolios.
Type 2i = Conservative with Income Emphasis. This type of
portfolio is very similar to our Type 2 Conservative portfolio but
has a larger emphasis on dividend paying and/or income
producing securities.
Type 3 = Moderately Conservative. This type of portfolio
typically holds a mix of common stocks, preferred shares, ETFs,
REITs (traded & non-traded), corporate bonds, municipal &
treasury bonds, precious metals, alternatives, and cash & cash
equivalents. Similar to a Type 2 portfolio, a Type 3 portfolio holds
blue-chip, large-cap common stocks with lower betas, but their
percentage of the total is less than our Type 2 portfolios. Thus, a
type 3 portfolio holds a higher percentage of growth stocks than
a Type 2 portfolio.
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Type 3i = Moderately Conservative with Income Emphasis. This
type of portfolio is very similar to our Type 3 Moderately
Conservative portfolio but has a larger emphasis on dividend
paying and/or income producing securities.
Type 4 = Moderately Aggressive. This type of portfolio typically
holds a mix of common stocks, ETFs, and may have a smaller
percentage of REITs and Preferred shares if they look to offer
opportunities for growth. It holds a higher percentage of growth
stocks than our Type 2 or Type 3 portfolios, and it therefore
exhibits more volatility than a Type 2 or Type 3 portfolio.
Type 4i = Moderately Aggressive with Income Emphasis. This type
of portfolio is very similar to our Type 4 Moderately Aggressive
portfolio, but also has an added emphasis on dividend paying
and/or income producing securities.
Type 5 = Aggressive. This type of portfolio typically holds almost
exclusively growth stocks and ETF’s. Therefore, a Type 5
Aggressive portfolio exhibits this highest level of volatility of all
our portfolios.
Advisor does not participate in wrap fee programs.
The Advisor does manage client assets. As of December 31, 2023,
the Advisor’s assets under management totaled the following:
Assets Under Management – $384,611,167 under discretionary
authority for 394 clients in 970 accounts. The Advisor has
approximately $8 million in registered non-traded REIT’s and
registered non-traded BDC’s held in some of the clients’ Fidelity
accounts. These investments are sold by prospectus and require
signed subscription agreements. Advisor does not collect a
commission for the sale of any non-traded REIT’s or BDC’s. Non-
traded REIT’s and non-traded BDC’s are billed along with the other
assets in the client account according to the client’s fee schedule.
Frank Beck, Jerry McIlhon, and Justin Simmons are the agents for
multiple fixed insurance contracts totaling approximately $10
million (no variable contracts) with various insurance companies.
Any transactions with the insurance companies require signed
applications from the client and will result in a commission to the
agent. If funds are used for the purchase of insurance that have
already been billed a management fee in advance the pro-rata
remaining fee for the quarter will be refunded. When
discretionary authority is granted, the Advisor will not need to
contact the client prior to executing trades in a client brokerage
account (except for the alternative investments, private funds and
insurance which have subscription agreements). Advisor holds
educational investment seminars for clients and prospects on
occasion. There is no cost to the attendees and no products are
offered for sale other than the services of Advisor for asset
management.