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Form ADV Part 1A Item 5I(1) · Answer type: yn · Item 5 - Wrap Fee Programs
Item 5I(1) asks whether the firm sponsors a wrap fee program. A wrap fee program generally charges a specified fee for advisory services and some transaction services that is not based directly on individual transactions. The program documents define what the fee includes and excludes.
The sponsor organizes or sponsors the program. Item 5I(1) does not state which operational duties the firm performs or which services the fee covers.
Wrap fees can bundle advisory and transaction services, but separate charges or excluded costs can still apply. The checkbox does not show whether the program costs more or less than another arrangement.
5I(1) distinguishes the sponsor role from the portfolio-manager role reported elsewhere in Item 5I. It does not compare the operational duties of those roles.
Program structure varies. Review the firm's wrap fee brochure and agreement for managers, services, excluded costs, fee rates, and any breakpoints.
5I(1) - Sponsor the wrap fee program (Yes / No).
This is one checkbox in Item 5I, "Participation in Wrap Fee Programs."
If 5I(1) is Yes, the firm reports sponsoring a wrap fee program. The answer does not establish that the fee is all-inclusive, that multiple managers are available, or that wrap programs are the firm's primary service.
Compare the program's stated fee and excluded costs with the expected services and trading activity. Item 5I(1) does not provide enough information for that cost comparison.
A Yes does not tell you the wrap fee rates, available investment managers, minimum account sizes, or specific program features. Wrap programs vary significantly in their structure, costs, and manager selection among different sponsors.
The wrap fee structure does not establish investment performance, service quality, or client fit.
Wrap fee arrangements can create potential conflicts of interest if sponsors receive different compensation from various managers within their programs, potentially influencing manager recommendations based on sponsor economics rather than client suitability.
The checkbox does not describe the sponsor's specific program duties, manager-selection process, or client review process.
Yes
The firm reports sponsoring wrap fee programs. On Best Investors, find Item 5I on the firm's ADV panel and confirm 5I(1) is Yes. Also check 5I(2)(a)-(c) wrap-related regulatory AUM to understand the scale of assets in wrap programs.
Review the firm's total regulatory AUM to see what portion operates through wrap programs versus traditional advisory arrangements, and compensation structure to understand how wrap fees fit with other fee arrangements.
Ask the firm about their wrap program features, available investment managers, fee schedules, minimum account requirements, and how they select and monitor managers within their wrap platform.
No
The firm reports No and does not report sponsoring a wrap fee program under 5I(1). Look at the other 5I fields for any reported role as a portfolio manager, and check 5G for separately reported services.
The reported No does not indicate service limits, cost, or quality. Review the other Item 5I and Item 5G answers for roles and services the firm reports.