BILLING PROCEDURES & CLARIFICATIONS

  • Accounts are billed monthly in advance.
  • Fees are calculated based on the total annual fee listed on the executed WWA Investment Advisory Agreement and the average daily balance at the custodian. 
  • All assets in the account are billed at the same rate, including managed assets, cash balances, and any blocked positions. Cash holds, full liquidations, and trading blocks are not excluded from the billing calculation. In other words, holding assets under WWA is not free in any case.
  • Fees are deducted at Schwab anywhere from the 4th-10th of each month. 
  • Advisors are paid anywhere from the 14th-18th of each month, depending on weekends and bank clearing times. Our goal is to always have fee payments sent out by the 15th of the month.
  • Reporting in Orion outlining a monthly breakdown of fees and payments for each Advisor is currently under construction as we build out something new.
  • Direct billing questions to the Operations Team at service@wealthwatchadvisors.com or to Bill Gastl at bill.g@wealthwatchadvisors.com.   

Assigning Fees to a New Account

  • Fees and rep codes are assigned to accounts through the paperwork workflow process in Forms Logic when writing new business. 
  • The Forms Logic workflow will populate the selected rep code and Advisors will manually fill in the fee rate on the WWA Investment Advisory Agreement (“IAA”) when generating paperwork. 
  • The IAA must be signed by the Client and Advisor through the Forms Logic workflow/Docusign process in order to assign a fee to an account. If manually signing the forms, the PDF must be created in Forms Logic and downloaded, then manually attached into the new business ticket in Taiko to submit it to WWA once signed.
  • Each account owner only needs to sign the IAA once. Duplicate copies of the IAA are not required for each account.
  • Unique Fee Supplement paperwork is required in addition to the normal IAA when investing in HCM Ultra Aggressive, any of the ZEGA Financial models, or GrayStreet drilling. See Fee Supplement section for details and always reach out to WWA Operations with any questions before sending out paperwork.

Changing Fees on an Active Account

  • Fees can be changed after the initial account opening process anytime by submitting a Billing ticket in Taiko. Multiple accounts may be listed within the same ticket. Changes submitted on the 1st of the month or later cannot be applied intra-month and will be applied to the following month cycle.
  • A Billing ticket can be submitted to raise or lower a fee over time without a new signed IAA as long as the fee edits are within the parameters of the rate on the original IAA. (If the fee is being raised above what the client already signed off on, a new IAA will be required. If the fee is being lowered below what the client already signed off on, no paperwork is needed).

Fee ranges are also outlined in our ADV and contractual documents.

Advisors may set the total fee anywhere between the maximum and minimum rate at their discretion.

Advisors are always paid the “rep remainder” (the difference between the total fee and the minimum fee).

Non-Wrap TBP Accounts: (our standard account type at Schwab)

Maximum fee = 195bps.
Minimum fee = 77bps.

For example, a fee set at 77bps will earn the Advisor zero bps. A fee set at 177bps will earn the Advisor 100bps.

The 77bps covers WWA’s minimum costs, including the model manager cost.

HCM Ultra Aggressive: *the additional fee supplement form is required in addition to the normal IAA*

Maximum fee = 252bps.
Minimum fee = 152bps.

HCM Ultra Aggressive manager cost is 95bps instead 20bps. Fees for this model are increased so the Advisor can collect up to 100bps.

For example, a fee set at 152bps will earn the Advisor zero bps. A fee set at 252bps will earn the Advisor 100bps.

ZEGA Financial: *the additional fee supplement form is required in addition to the normal IAA*

Maximum fee = 202bps.
Minimum fee = 102bps.

ZEGA Financial manager cost is 45bps instead 20bps. Fees for this model are increased so the Advisor can collect up to 100bps.

For example, a fee set at 102bps will earn the Advisor 0bps. A fee set at 202bps will earn the Advisor 100bps.

***other investment models may require separate fee disclosures based on varying costs as we continue to add more diverse investment options to our platform. Always reach out to WWA Operations to confirm what forms are needed if there are any questions, otherwise you will be notified if something is missing during the account opening/trade approval process***

  • A new account will be billed for the first time once (2) conditions are met:
    1. WWA IAA paperwork has been received in good order.
    2. A balance is in the account at the Custodian.
  • In other words, fees will be due from the first day there is a balance in the account at Schwab as long as the client has signed the IAA. If a client signs the IAA late (after the account is already funded) their first round of charges will still be backdated to the date the account was funded.
  • Fees are due regardless of whether a model is assigned to the account, and regardless of whether the account is in-kind or in cash. Please note that cash holds, blocked securities and account liquidations using the “Full Liquidation – Client Requested” model are included in the billing calculation and charged the same rate.
  • Billing does not stop until the account balance is fully transferred away. 
  • Placing trades of any kind in an account is always billable, including liquidating an account to hold cash or transfer out.

Unique fee supplement forms are required in addition to the normal Investment Advisory Agreement in any case where the manager cost is different than our usual 20 bps. 

The cost of each model can be found in the Strategy Gallery in Taiko under “Investments” and viewing “Strategist Fee”. 

Examples of models with a different model cost outside the 20 bps cost are as follows:

  1. All ZEGA Financial models
  2. HCM Ultra Aggressive 
  3. GrayStreet Drilling

Each unique fee supplement document required to invest in these models can be found on the WWA – Client Contracts page of our website, or within the list of WWA forms for electronic signing in the FormsLogic workflow process.

A report showing each Advisor’s billing details is currently under construction in Orion. In the meantime, or you can always contact Bill Gastl or Wealth Watch Operations with questions.

Advisor payments will fluctuate month over month. This happens because we bill in advance and we use the average daily balance of accounts at the custodian to calculate fees. Our stance is that this billing system the most accurate way to calculate fees, however it does create “high-highs” and “low-lows” which are normal inside our database.

Because we use average daily balance numbers instead of using month-end values to calculate fees, our fee calculations are highly susceptible to the impact of daily market fluctuation, and are impacted by the number of calendar days in a month.

Months with fewer calendar days may produce less in collected fees as compared to a month with more calendar days.

Months where the market is fluctuating up on most days in a month will produce compounding higher revenue for our Advisors. Months where the market is fluctuating down most days in a month will produce compounding lower revenue for our Advisors. Compare this to a billing system that is looking at month-end values only for a 1 day period only, and you have a more fluctuating fee pattern when comparing monthly payments over time.

Our billing system also incorporates a True-Up calculation, where catch-up credits and/or debits are applied forward from the previous advance month. Since we bill in advance, we need to either refund back to the client or charge the client extra amounts from the previous period depending on the average daily balance, when the account was trading for the first time, and if there were any account additions or distributions. This can also cause our Advisory payments to fluctuate.

The combination of these variables should be considered by Advisors when examining their payments, rather than only focusing on AUM figures on a specific day. 

Please reach out to Bill Gastl with any questions.

Technology fees are charged to client accounts on a quarterly basis (January, April, July, October). The terms of the fees are described in the Investment Advisory Agreement.

The lesser of $10.00 or 50bps is charged to each account per quarter.

The fees are entirely separate from monthly advisory fees. The fees do not produce any revenue for Advisors. The fees are to simply pass along flat technology costs per account directly to clients.