Frequently Asked Questions
What are the advantages of separate account programs?
What specific help will I get in setting my goals and objectives?
How many different investment styles does OFI Private Investments, Inc. offer?
Q:What is a private/separate account money management services program (sometimes called a "wrap-fee program") and how does it differ from a mutual fund
A:Private/separate account or wrap-fee are terms used to describe a number of investment services which have been "wrapped" together and covered with a single annual fee. This fee includes trading costs as well as the advice and investment management services rendered through the program. The minimum account size per manager in a wrap-fee program is generally $100,000. Your wrap-fee is based on the percentage of assets in the account. Mutual funds, on the other hand, were designed to give investors with less to invest access to the capital markets. When investing in a mutual fund, you own shares in the fund, not the underlying securities. With a separate account, you own the individual securities in your account. The minimum account opening size for a mutual fund may be as low as $250.
Q:What are the advantages of separate account programs?
A:Separate account programs give investors access to leading portfolio managers who generally deal with very large individual and institutional accounts (in excess of $10 million). Your advisor also provides objective, third-party monitoring of the separate account portfolio manager's performance. Portfolios are managed on an individual basis. In other words, one investor's stocks are not commingled, or pooled, with those of other investors. The client owns the stocks in his or her portfolio. Furthermore, separate account programs are cost effective because investors pay one asset-based fee which includes investment counseling, brokerage fees and ongoing account administration. Another benefit of separate accounts involves tax gain/loss harvesting, which is a technique for minimizing capital gains/tax liability through the selective realization of gains and losses in a separate account portfolio. This can be a significant benefit to the investor.
Q:What specific help will I get in setting my goals and objectives?
A:In a one-to-one consultative environment that utilizes an investor questionnaire, your advisor and you will establish your investment objectives and risk profile. The information in the questionnaire is then shared with the portfolio manager.
Q:How many different investment styles does OFI Private Investments, Inc. offer?
A:All of the following:
- All Cap Equity CDP
- All Cap Value
- Large Cap Value
- Opportunistic Long Short
- Gulf Value
- International ADR
- International Equity
- Dividend Growth
- Discovery Small Cap Growth
- Small Cap Growth
- SMid Value
- SMid Core
- S&P 500 Enhanced Index
- Tax Managed S&P 500 Enhanced Index
- Large Cap Growth
- Taxable Fixed Income
- Global Fixed Income
- Real Estate Securities
- Global Real Estate Securities
Q:How much can I customize my OFI Private Investments portfolio? For example, can I exclude tobacco or liquor stocks?
A:Reasonable restrictions may be imposed. We may, however, reject an account if we believe that the restrictions could affect the way the account should be managed.
Q:What type of ongoing reports will I receive?
A:You will receive written confirmations of each transaction from your sponsor firm and a monthly statement from the sponsor or custodian that includes all deposits, disbursements, dividends, interest earned, purchases, sales and the overall net worth of the portfolio. Your advisor will assess the manager's performance on a quarterly basis. The performance review includes in-depth analysis of the manager's performance as it compares to your individual goals, inflation and appropriate market indices. You will also receive a quarterly market overview and the manager's outlook on the capital markets and the economy.
Q:Why should I pay a fee for this service?
A:The wrap fee is all-inclusive. Services include: An advisory fee, money manager's fee, all commission and transaction costs, ongoing oversight and due diligence on the manager(s), investment planning expertise, asset allocation services, reviews and quarterly investment performance reviews. The fee is charged quarterly based on the value of assets in the account.