Disclosures
Absolute Return Strategies: Global Growth, Aggressive Growth, Long/Short, 50/50 Portfolio, Diversified Portfolio, Single Sector
Passive Core Portfolios: eMAC, Income & Growth, Income
Verification Reports: Global Growth, Aggressive Growth, Long Short
Pledge: ETF PM’s Pledge to Give Back
The Spaulding Group, an independent third party that is not affiliated with ETF PM, has verified the performance of ETF PM’s representative accounts.
Global Growth Performance Disclosure
General Information
All of our Global Growth performance results (the “Performance Results”) relate to the Global Growth representative account (the “GG Portfolio”), an account that David Kreinces first traded in January 2008. Mr. Kreinces left Merrill Lynch on November 27, 2007 and started ETF Portfolio Management, LLC (“ETF PM”) on December 1, 2007.
Performance Achieved at ETF PM
The Performance Results at ETF PM reflect the single account performance achieved by the representative ETF PM Global Growth account. Accordingly, the Performance Results are similar to the performance achieved by the composite of ETF PM’s Global Growth accounts, although the figures are not identical. The Performance Results are verified by The Spaulding Group, are net of all fees, and assume reinvestment of dividends. Please see the Global Growth Verification for the The Spaulding Group’s latest report or email a request for a copy of the report to info@etfpm.com.
Each GG advisory account (each, an “ETF PM Account”) was charged an annual management fee of 0.5% of assets under management in 2008 and was solely responsible for all commissions and other transaction charges as well as any charge relating to the custody of securities in such account (the “ETF PM Fee Structure”). In 2009, the annual management fee became 2% for our Global Growth strategy, and we do not charge a performance fee on any of our accounts. Advisory fees are disclosed in each client’s investment management agreement with ETF PM.
Historical performance is not indicative of future performance. Additionally, the investment return and principal value of an ETF PM Account will fluctuate and may be worth more or less than the original cost when liquidated. Investment environment and market conditions may be markedly different in the future, and investment returns will fluctuate in value. There can be no assurance that any ETF PM Account will achieve positive returns in future periods.
The GG Portfolio was implemented, and will continue to be implemented, with a view towards long-term capital protection and growth. The indices presented are for comparison purposes only and no index is directly comparable to the investment strategy of any ETF PM Account employing the GG Portfolio.
Benchmarks
The S&P 500 Index (SPX) is an unmanaged index of common stocks that represents the U.S. stock market. The index is mainly comprised of large cap companies and reflects roughly two-thirds of the total domestic stock market value.
The Dow Jones Credit Suisse Hedge Fund Index (“HFI”) includes approximately 8,000 funds that each have a minimum of $50mm under management, a 12-month track record, and audited financials. The index is asset weighted and excludes separate accounts.
Aggressive Growth Performance Disclosure
General Information
All of our Aggressive Growth performance results (the “Performance Results”) relate to the Aggressive Growth representative account (the “Aggressive Growth Portfolio”), an account that David Kreinces first traded in January 2005 while he was a portfolio manager at Merrill Lynch & Co. (“Merrill Lynch”). Mr. Kreinces was solely responsible for the development of the Aggressive Growth Portfolio. While at Merrill Lynch, he had full discretionary authority over the selection of investments for, and was primarily responsible for the day-to-day management of, all accounts that employed the Aggressive Growth Portfolio (collectively, the “Merrill Lynch Aggressive Growth Accounts”).
Mr. Kreinces left Merrill Lynch on November 27, 2007 and started ETF Portfolio Management, LLC (“ETF PM”) on December 1, 2007. Most of the Merrill Lynch Aggressive Growth Accounts terminated their respective investment advisory agreements with Merrill Lynch and became investment advisory clients of ETF PM, allocating to the same Aggressive Growth Portfolio. The Aggressive Growth Portfolio managed by Mr. Kreinces at ETF PM is substantially similar to, if not the same as, the Aggressive Growth Portfolio employed by him while he was with Merrill Lynch. As was the case with Merrill Lynch, Mr. Kreinces has full discretionary authority over the selection of investments for, and is primarily responsible for the day-to-day management of, those ETF PM accounts that allocate to the Aggressive Growth Portfolio.
Performance Achieved at ETF PM: The Performance Results at ETF PM reflect the single account performance achieved by the representative ETF PM Aggressive Growth account, which is the account of an individual related to Mr. Kreinces. The representative account used to represent the Aggressive Growth Portfolio was chosen because it most closely conforms to the investment strategies utilized in the Aggressive Growth Portfolio. Individual account performance will vary based upon the inception date of the account, restrictions on the account, and other factors, and may not equal the performance presented herein. Accordingly, the Performance Results at ETF PM are similar to the performance achieved by the composite of ETF PM’s Aggressive Growth accounts although the figures are not identical. The Performance Results are verified by The Spaulding Group, are net of all fees, and assume reinvestment of dividends. Please see http://etfpm.com/resources/all-disclosures/performance-verification-reports/ for the latest performance report from The Spaulding Group or request the report at info@etfpm.com.
Performance Achieved at Prior Adviser: David Kreinces’ Prior Record: The Performance Results, between the period of January 1, 2005 through November 25, 2007 (the “Prior Performance Period”), reflect the performance of the same account achieved under the management of Mr. Kreinces while he was a portfolio manager at Merrill Lynch. The Performance Results from the Prior Performance Period have been verified by The Spaulding Group, are net of all fees, and assume reinvestment of dividends. Please see the Aggressive Growth Verification for the The Spaulding Group’s latest report or email a request for a copy of the report to info@etfpm.com.
The representative Merrill Lynch Aggressive Growth account was charged by Merrill Lynch an annual, all-inclusive fee of 1.5% of assets under management (the “Merrill Lynch Fee Structure”). On the other hand, each ETF PM advisory account (each, an “ETF PM Account”) is charged an annual management fee of 1.0% of assets under management in 2008 and is solely responsible for all commissions and other transaction charges as well as any charge relating to the custody of securities in such account (the “ETF PM Fee Structure”). In 2009, the annual management fee became 2% for our Aggressive Growth strategy, and we do not charge a performance fee on any of our accounts. Annual management fees are disclosed in each client’s investment management agreement with ETF PM. The Performance Results during the Prior Performance Period reflect the Merrill Lynch Fee Structure. Accordingly, if the ETF PM Fee Structure were taken into account instead of the Merrill Lynch Fee Structure, the Performance Results during the Prior Performance Period may be higher or lower than those presented.
Historical performance is not indicative of future performance. Although Mr. Kreinces will implement the Aggressive Growth Portfolio at ETF PM in substantially the same manner as that of when he was at Merrill Lynch, the Performance Results during the Prior Performance Period are not indicative of the future performance of the Aggressive Growth Portfolio at ETF PM. Additionally, the investment return and principal value of an ETF PM Account will fluctuate and may be worth more or less than the original cost when liquidated. The investment environment and market conditions during the Prior Performance Period may be markedly different in the future and investment returns will fluctuate in value. There can be no assurance that any ETF PM Account will achieve positive returns in future periods.
The Aggressive Growth Portfolio was implemented, and will continue to be implemented, with a view towards long-term capital protection and growth. The indices presented are for comparison purposes only and no index is directly comparable to the investment strategy of any ETF PM Account employing the Aggressive Growth Portfolio.
Benchmarks: The S&P 500 Index (SPX) is an unmanaged index of common stocks that represents the U.S. stock market. The index is mainly comprised of large cap companies and reflects roughly two-thirds of the total domestic stock market value.
The Dow Jones Credit Suisse Hedge Fund Index (“HFI”) includes approximately 8,000 funds that each have a minimum of $50mm under management, a 12-month track record, and audited financials. The index is asset weighted and excludes separate accounts.
Long/Short Performance Disclosure
General Information
All of our Long/Short performance results (the “Performance Results”) relate to the Long/Short representative account (the “LS Portfolio”), an account that David Kreinces first traded in January 2007 while he was a portfolio manager at Merrill Lynch & Co. (“Merrill Lynch”). Mr. Kreinces left Merrill Lynch on November 27, 2007 and started ETF Portfolio Management, LLC (“ETF PM”) on December 1, 2007.
Performance Achieved at ETF PM
The Performance Results at ETF PM reflect the single account performance achieved by the representative ETF PM Long/Short account. Accordingly, the Performance Results at ETF PM are similar to the performance achieved by the composite of ETF PM’s Long/Short accounts although the figures are not identical. The Performance Results are verified by The Spaulding Group, are net of all fees, and assume reinvestment of dividends. Please see the Long/Short Verification for the The Spaulding Group’s latest report or email a request for a copy of the report to info@etfpm.com.
Each LS advisory account (each, an “ETF PM Account”) was charged an annual management fee of 1% of assets under management in 2008 and are solely responsible for all commissions and other transaction charges as well as any charge relating to the custody of securities in such account (the “ETF PM Fee Structure”). In 2009, the annual management fee became 2% for our Long/Short strategy, and we do not charge a performance fee on any of our accounts. Advisory fees are disclosed in each client’s investment management agreement with ETF PM.
Historical performance is not indicative of future performance. Additionally, the investment return and principal value of an ETF PM Account will fluctuate and may be worth more or less than the original cost when liquidated. Investment environment and market conditions may be markedly different in the future and investment returns will fluctuate in value. There can be no assurance that any ETF PM Account will achieve positive returns in future periods.
The LS Portfolio was implemented, and will continue to be implemented, with a view towards long-term capital protection and growth. The indices presented are for comparison purposes only and no index is directly comparable to the investment strategy of any ETF PM Account employing the LS Portfolio.
Benchmarks
The S&P 500 Index (SPX) is an unmanaged index of common stocks that represents the U.S. stock market. The index is mainly comprised of large cap companies and reflects roughly two-thirds of the total domestic stock market value.
The Dow Jones Credit Suisse Hedge Fund Index (“HFI”) includes approximately 8,000 funds that each have a minimum of $50mm under management, a 12-month track record, and audited financials. The index is asset weighted and excludes separate accounts.
50/50 Portfolio Performance Disclosure
General Information
The 50/50 Portfolio (“50/50″) is a hypothetical portfolio that reflects 50% eMAC Portfolio, 25% Aggressive Growth and 25% Global Growth. The 50/50 performance estimates at ETF PM are backtested and have not been audited. The 50/50 performance estimates are net of all fees and assume reinvestment of dividends with annual rebalancing. Please see full disclosures for ETF PM’s eMAC, Aggressive Growth and Global Growth portfolios.
Benchmarks
The S&P 500 Index is an unmanaged index of common stocks that represents the U.S. stock market. The index is mainly comprised of large cap companies and reflects roughly two-thirds of the total domestic stock market value.
The Dow Jones Credit Suisse Hedge Fund Index (“HFI”) includes approximately 8,000 funds that each have a minimum of $50mm under management, a 12-month track record, and audited financials. The index is asset weighted and excludes separate accounts.
Diversified Portfolio Performance Disclosure
General Information
The Diversified Portfolioe (“DVR”) is a hypothetical portfolio that reflects an equal combination of our eMAC, Global Growth and Aggressive Growth portfolios. The DVR performance estimates at ETF PM are backtested and have not been audited. The DVR performance estimates are net of all fees and assume reinvestment of dividends. Please see full disclosures for ETF PM’s eMAC, Aggressive Growth and Global Growth portfolios.
Benchmarks
The S&P 500 Index (SPX) is an unmanaged index of common stocks that represents the U.S. stock market. The index is mainly comprised of large cap companies and reflects roughly two-thirds of the total domestic stock market value.
The Dow Jones Credit Suisse Hedge Fund Index is designed to reflect the hedge fund industry. The index is asset weighted in order to avoid underweighting top performers and overweighting decliners. Member funds report monthly performance and have annually audited financial statements.
eMAC Portfolio Performance Disclosure
General Information
All of our eMAC Portfolio performance estimates (the “Performance Estimates”) relate to the eMAC Portfolio model (the “eMAC Portfolio”), a strategy that David Kreinces first employed in September 2008. Mr. Kreinces tailored the eMAC Portfolio according to the efficient multi-asset class core ETF portfolio outlined by David Swensen in ”Unconventional Success” and his revisions. Swensen’s performance managing Yale University’s endowment fund is leading Wall Street in many respects and his views have significantly broadened the industry’s perception of proper diversification.
Mr. Kreinces left Merrill Lynch on November 27, 2007 and started ETF Portfolio Management, LLC (“ETF PM”) on December 1, 2007. It is expected that high net worth individuals and institutional clients will allocate to the eMAC Portfolio at ETF PM.
Performance Estimates at ETF PM
The Performance Estimates at ETF PM reflect an estimate of the performance that would have been achieved by a hypothetical eMAC Portfolio account. The Performance Estimates at ETF PM have not been audited. The Performance Estimates are net of all fees and assume reinvestment of dividends.
The Performance Estimates for the eMAC Portfolio do not reflect an advisory fee and no advisory fee will be charged for this account structure at ETF PM. Each ETF PM advisory account is solely responsible for all commissions and other transaction charges as well as any charge relating to the custody of securities in such account (the “ETF PM Fee Structure”).
Historical performance estimates are not indicative of future performance. The investment return and principal value of an ETF PM Account will fluctuate and may be worth more or less than the original cost when liquidated. The investment environment and market conditions may be markedly different in the future and investment returns will fluctuate in value. There can be no assurance that any ETF PM Account will achieve positive returns in future periods.
The eMAC Portfolio was implemented, and will continue to be implemented, with a view towards efficient multi-asset class diversification. The indices presented are for comparison purposes only and no index is directly comparable to the investment strategy of any ETF PM Account employing the eMAC Portfolio.
Income & Growth Performance Disclosure
General Information
All of our Income & Growth (I&G) performance estimates (the “Performance Estimates”) relate to the I&G model benchmark which is 42% Global Equity (VT), 8% REITs (VNQ), 35% Long-Term Treasuries (TLT), 7% Medium-Term Treasuires (IEF), and 8% Treasury Inflation Protected Securities (TIP). Mr. Kreinces was solely responsible for the development of the passive I&G portfolio and he had full discretionary authority over the selection of investments. It is expected that high net worth individuals and institutional clients will allocate to I&G at ETF PM.
Performance Estimates at ETF PM
The Performance Estimates at ETF PM reflect an estimate of the performance that would have been achieved by a hypothetical I&G account. The Performance Estimates at ETF PM have not been audited. The Performance Estimates are net of all fees and assume reinvestment of dividends.
The Performance Estimates for the hypothetical model I&G account do not reflect an advisory fee and no advisory fee will be charged for this account structure at ETF PM. Each ETF PM advisory account is solely responsible for all commissions and other transaction charges as well as any charge relating to the custody of securities in such account (the “ETF PM Fee Structure”).
Historical performance estimates are not indicative of future performance. The investment return and principal value of an ETF PM Account will fluctuate and may be worth more or less than the original cost when liquidated. The investment environment and market conditions may be markedly different in the future and investment returns will fluctuate in value. There can be no assurance that any ETF PM Account will achieve positive returns in future periods.
The I&G portfolio was implemented, and will continue to be implemented, with a view towards strategic and low-cost diversification across multiple asset classes. The indices presented are for comparison purposes only and no index is directly comparable to the investment strategy of any ETF PM Account employing I&G.
Income Portfolio Performance Disclosure
General Information
All of the Income Portfolio performance estimates (the “Performance Estimates”) relate to the 30/70i model benchmark which is 30% Vanguard Total World Stock (VT) and 70% iShares 20+ Year Treasury Bond (TLT). It is expected that high net worth individuals and institutional clients will allocate to the 30/70i Portfolio at ETF PM.
Performance Estimates at ETF PM
The Performance Estimates at ETF PM reflect an estimate of the performance that would have been achieved by a hypothetical 30/70i account. The Performance Estimates at ETF PM have not been audited. The Performance Estimates are net of all fees and assume reinvestment of dividends.
The Performance Estimates for the hypothetical model 30/70i account do not reflect an advisory fee, and no advisory fee will be charged for this account structure at ETF PM. Each ETF PM advisory account is solely responsible for all commissions and other transaction charges as well as any charge relating to the custody of securities in such account.
Historical performance estimates are not indicative of future performance. The investment return and principal value of an ETF PM Account will fluctuate and may be worth more or less than the original cost when liquidated. The investment environment and market conditions may be markedly different in the future, and investment returns will fluctuate in value. There can be no assurance that any ETF PM Account will achieve positive returns in future periods.
The 30/70i Portfolio was implemented, and will continue to be implemented, with a view towards a simple investable benchmark for a core portfolio. The indices presented are for comparison purposes only and no index is directly comparable to the investment strategy of any ETF PM Account employing the 30/70i Portfolio.
Single Sector Performance Disclosure
General Information
All of our Single Sector performance results (the “Performance Results”) relate to the Single Sector representative account (the “SS Portfolio”), an account that David Kreinces first traded in January 2008. Mr. Kreinces left Merrill Lynch on November 27, 2007 and started ETF Portfolio Management, LLC (“ETF PM”) on December 1, 2007.
Performance Achieved at ETF PM
The Performance Results at ETF PM reflect the single account performance achieved by the representative ETF PM SS Portfolio. Accordingly, the Performance Results are similar to the performance achieved by the composite of ETF PM’s Single Sector accounts, although the figures are not identical. The Performance Results are net of all fees and assume reinvestment of dividends.
Each SS advisory account (each, an “ETF PM Account”) was charged an annual management fee of 1.0% of assets under management in 2008 and was solely responsible for all commissions and other transaction charges as well as any charge relating to the custody of securities in such account (the “ETF PM Fee Structure”). In 2009, the annual management fee became 2% for our Single Sector strategy, and we do not charge a performance fee on any of our accounts. Advisory fees are disclosed in each client’s investment management agreement with ETF PM.
Historical performance is not indicative of future performance. Additionally, the investment return and principal value of an ETF PM Account will fluctuate and may be worth more or less than the original cost when liquidated. Investment environment and market conditions may be markedly different in the future, and investment returns will fluctuate in value. There can be no assurance that any ETF PM Account will achieve positive returns in future periods.
The SS Portfolio was implemented, and will continue to be implemented, with a view towards maximum growth with capital protection. The indices presented are for comparison purposes only and no index is directly comparable to the investment strategy of any ETF PM Account employing the SS Portfolio.
Benchmarks
The S&P 500 Index (SPX) is an unmanaged index of common stocks that represents the U.S. stock market. The index is mainly comprised of large cap companies and reflects roughly two-thirds of the total domestic stock market value.
The Dow Jones Credit Suisse Hedge Fund Index (“HFI”) includes approximately 8,000 funds that each have a minimum of $50mm under management, a 12-month track record, and audited financials. The index is asset weighted and excludes separate accounts.
Our Pledge To Give Back
ETF PM’s pledge, to give back 15% of our annual advisory fees to the schools and charities selected by our clients, is intended to run annually for the life of the firm. However, ETF PM reserves the right to change or modify this pledge, if needed, with written notification to all clients. The pledge applies to new firm clients beginning December 2009 and extends to all pre-existing clients in 2011. Clients may each submit one 501(c)(3) organization annually for approval.
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