Please note that these Frequently Asked Questions primarily pertain to our Investment Management Services.
What are your services?
Anthony Investment Management, LLC (AIM) is a fee-only Registered Investment Advisor. We provide independent investment advisory services to individuals, businesses, nonprofit organizations, and retirement plan sponsors.
What does fee-only really mean?
As a fee-only Registered Investment Advisor, we are compensated only by our clients, and we receive no commissions or referral fees. In other words, we’re financially vested in our client’s success, and we have an interest in seeing our clients’ assets grow over time. Put simply, if our clients do better, we do better.
What makes you different from other investment advisors?
There are a few things that we think are unique and special about our firm. Importantly, we believe that the fiduciary standard is best for our clients. This standard requires that we put our clients' interests ahead of our own, and that we must try to minimize conflicts of interest and disclose any that remain. This is very different from a broker's suitability standard, which says that an investment only needs to be suitable for a client and may involve the advisor getting paid a commission to recommend a certain product.
Are retirement plan services a side business for you or a significant part of your practice?
Retirement plan management and consulting is a significant part of our practice. We are amazed at the number of advisors that say they do it, but lack the experience and expertise required to do this service well. Because of the fiduciary liability issues inherent in the retirement plan market, we can only hope that those advisors who “play” in this area carry a commensurate and appropriate level of professional errors and omissions insurance. We have an established track record of providing plan sponsors and their participants with competent, professional service and low total plan fees.
What kind of investment strategies do you employ?
For smaller accounts, we typically use a combination of mutual funds and exchange traded funds (ETFs) when building a portfolio. For many of our larger accounts, we manage individual equity portfolios using an absolute return, contrarian value investment approach. The goal for our individual equity portfolios is to provide our clients with an attractive absolute return over a full market cycle. Unlike much of our competition that’s primarily focused on relative returns, we view investing, along with risk and reward, in absolute terms. Put simply, we love making money and hate losing it.
What do you mean by periodic short-term underperformance?
We use a flexible approach to building portfolios. For example, if stocks appear fully priced with little regard for potential risks, then our cash balances may build as we wait for opportunities to invest with less downside or more upside. We believe our willingness to hold cash, as well as our focus on minimizing the probability of permanent loss of capital, gives us a longer-term advantage. However, this approach sometimes requires patience from our clients as we wait for the market to offer us attractively valued opportunities.
Why the emphasis on total return?
We believe clients should seek total return, not just dividends or interest. The traditional concept of an “all bond” portfolio no longer makes sense to us as it places unnecessary and inappropriate restrictions on portfolio design. Total return includes both income and capital appreciation. In most situations, we base our portfolio design on a total return approach, focusing on the net portfolio change in market value.
What about a client’s risk tolerance?
We believe a client's risk tolerance is a significant consideration when developing an investment plan. Our clients' ability to achieve their goals and sleep well during turbulent markets are equally important to us.
What are your fees?
Our fees are well below the industry average. A typical investment advisor charges 1% or more per year on average. That’s much too high given the operational and technological advances in the investment advisory business over the last several years. Our annual fee for investment management varies, generally between 0.25% and 0.75% annually, depending on the market value of the assets under management.
Do you have an account minimum or a minimum fee?
While professional portfolio management often requires a substantial investment, Anthony Investment Management does not impose a specific account minimum or minimum fee. However, we do reserve the right to accept or decline any account.
Do you charge for an initial consultation?
No, there is no charge for an initial consultation. We understand the importance of earning your trust, and offer our opinion on your current situation without obligation.
Can we meet in person before I become an AIM client?
Yes. Although AIM currently has clients in several different states, we are happy to meet with you in person assuming you are in the general area of our office. Through the effective use of the telephone, fax and email, it’s easy to develop an investment strategy, establish new accounts, make changes when necessary, and exchange relevant financial information and ideas as needed.
How can we contact you?
You can contact us by phone at (304) 905-1394, or via fax at (304) 905-1395. Tom Anthony can be reached directly by email at email@example.com.
Are references available?
Yes. Once we meet with you either on the telephone or through an initial consultation, we are happy to provide you with a few client references.
Will AIM hold my assets directly?
No, AIM does not take custody of your funds. They are held by a brokerage firm that carries SIPC and other private insurance. We typically recommend that clients utilize the brokerage and clearing services of TD Ameritrade Institutional for investment management accounts.
Does anyone at AIM have access to my money?
No, we don’t have access to your money. Your money is held in an account in your name by TD Ameritrade Institutional. AIM only has limited discretionary authority to trade securities on your behalf and deduct our management fee from the account(s) under our management.
Will I be required to move my assets to TD Ameritrade Institutional?
For investment management clients, you will be required to change custodians. After extensive research on the topic, it’s our opinion that TD Ameritrade offers our clients the best blend of security, safety, and low-cost features. We will continue to review our relationship with TD Ameritrade, and should we find a custodian that can better serve the needs of our clients, we would use them.
What kind of transaction costs are assessed by TD Ameritrade Institutional?
All online orders for stocks and many exchange-traded funds are charged at a flat rate of $6.95. When using funds from Dimensional Fund Advisors, online fund purchases and sales are charged a flat rate of $9.99. For other mutual funds where transaction fees are applicable, such as Vanguard, online fund purchases and sales are charged a flat rate of $24. There may also be short-term trading fees charged by either the mutual fund and/or the custodian. These fees are designed to discourage short-term trading. AIM will try to avoid these types of fees unless, at the client’s urging or request, we are forced to make trades, which would cause such fees to be incurred. Please note that all fees are subject to change at the custodian’s discretion.
Is AIM affiliated with TD Ameritrade Institutional?
No. Anthony Investment Management is not affiliated with TD Ameritrade Institutional, nor are we compensated by that company in any way through fees, commission, or incentives. In the spirit of full disclosure, our firm is supplied necessary software that allows our in-house portfolio management system to work efficiently with TD Ameritrade’s back-office operations and trading desks. This software is available to all investment advisors.
Will I have internet access to my account?
Yes, internet access is available to our investment management clients through a special TD Ameritrade Institutional website 24 hours per day, 7 days per week.
How often do I receive statements and reports?
TD Ameritrade Institutional sends monthly statements to all clients for all accounts. You have the choice of receiving paper copies of your account statements and trade confirmations, or you can receive these items electronically. In addition, AIM may provide you with additional portfolio reporting as part of our periodic reviews with you.
How do I get started?
What happens once I become a client?
Upon completion of the account opening and asset transfer process, we will begin implementing our mutually agreed upon investment strategy. The strategy is developed after a review of your current holdings and through a discussion with you that helps us fully understand the financial issues and concerns that are most important to you, including a review of your risk tolerance. We always remain flexible in our investment strategy so that we can react to both anticipated and unanticipated changes in your personal financial situation.
Can we incorporate existing stock, bond or mutual fund positions into our portfolio with you, or do I have to sell everything?
In most cases, we are happy to incorporate selected current holdings into your portfolio. In some cases, it simply does not make sense to sell everything due to the tax consequences. If we feel strongly that we should move out of one or more of your current holdings, we will make the case to you and then let you decide.
How often will you review my portfolio?
All accounts are monitored on an ongoing basis. We do recommend a more formal review with you regarding your account(s) on an annual basis either by telephone or in-person. We are always here to respond to an immediate need for a portfolio review should changes to your personal situation dictate such action.
How often will you meet with me?
We have found through experience that we will typically talk to you more during the first year of our working together. After the first year, we may not interact as often. However, we always encourage our clients to contact us if there are any changes in their financial situation or investment objectives that would impact our previous recommendations and/or services. We are also available “on call” to answer your investment related questions, or to provide advice and guidance on those issues impacting your personal financial situation.
Do you accept discretion over trading?
Yes, we do. It is important to emphasize that most of our clients hire us to manage their assets so they don’t have to. Consequently, once we agree on an investment strategy with you, we will manage your account(s) without receiving permission from you for each and every transaction that we place on your behalf.
Do you accept non-discretionary accounts?
Only on a very limited basis. Although most of our clients work with us on a discretionary basis, we do provide investment management services on a non-discretionary basis. This arrangement works well for the investor who is more hands-on but wants an investment professional as a partner in making investment decisions.
Do you offer comprehensive financial planning in addition to your investment planning services?
Because of the complexities inherent in comprehensive financial planning, we have chosen to primarily focus our efforts in the areas of investment management and retirement plan consulting. We believe that we offer the most value in these areas through a combination of our expertise and experience. However, we do incorporate your financial planning related concerns into our investment strategies as appropriate, and we do offer general financial planning guidance and advice to our investment advisory clients on an as needed basis.
Do you work with our accountant?
With a client's permission, we will always work with their other advisors. Allowing us to speak with them directly and/or provide data and information assists in the seamless handling of our clients' financial needs.
Will I receive reports that will help with tax preparation?
At the beginning of each year, TD Ameritrade Institutional will send a Form 1099 to each client that had taxable transactions or distributions in the prior year. We can also provide you with a Realized Gains and Losses Report that you may find helpful when preparing your annual tax return. It’s important for us to emphasize that our clients need to provide us with the cost basis information for any securities transferred to us but not purchased through us if not provided by your prior brokerage firm. We will have all the information that we need for any securities originally purchased through us.
What happens if I want to leave?
You are not locked in, there is no ding fee on the way out, and you typically do not need to sell the positions in your account.