Offering Legal, Tax, Business & Banking Services to Hedge Funds & Fund Managers Worldwide
Separate Managed Account Business
Fees Professional money managers' fees typically run from 1% to 3% of assets under management. A prospectus is not issued for a separate account. Managers list their basic fee structures in a regulatory filing called a Form ADV Part 2. An investor can obtain this document by contacting the manager, but they tend not to be as widely available through unrestricted online downloads as mutual fund prospectuses. Moreover, the published fee schedule in the ADV Part 2 is not necessarily firm—it is subject to negotiation between the investor (or the investor's financial advisor) and the money manager. Often, it is not a single fee but a scale in which the fee (expressed as a percentage of assets under management) decreases as the asset volume (the amount invested) increases.
The Importance of Due Diligence Because SMAs do not issue registered prospectuses, investors or their advisors need to rely on other sources for investigating and evaluating the manager.
Tax BenefitsConsider, for example, a separate account portfolio in which two securities have been purchased at similar prices. Over time, one of the securities has doubled in value while the other has fallen by half. By instructing the money manager to sell both securities, the gains generated by the security that has doubled in value are offset by the losses in the other security, reducing considerably any capital gains tax liability. The proceeds from the sale can be reinvested, maintaining the balance in your account. In a similar fashion, if you sold real estate, art or other investments at a profit, but have unrealized losses in your separate account, you could realize the losses and use them to offset the gains from the sale of your other investments.
Another tax benefit that comes with SMAs is the lack of embedded capital gains, a common issue with mutual funds. Since mutual funds are "mutual," all investors share the tax liability on the capital gains incurred by the fund, which must pay them all out once a year. So, for example, if the fund doubled in value from January through November, investors purchasing into the fund in December did not get the benefit of any of those gains, but they do inherit the tax liability because the gains are embedded in the portfolio. Separate account investors, thanks to individual cost basis on the underlying securities, would not be liable for capital gains generated prior to the day they invested in the portfolio.
What Is a Separate Account? A separate account is an investment portfolio owned by an investor and managed by a professional investment firm—typically registered investment advisors(RIA). Although separate accounts are usually opened through a brokerage or financial advisor, they may also be held at a bank or opened with an insurance company. Sometimes these accounts are referred to as separately managed accounts (SMA) or individually managed accounts.
In a separate account, funds are not pooled with the investments of other investors. Investors can choose from a range of approaches in order to create a portfolio that is oriented towards their individual investment goals. An RIA or portfolio manager is in charge of making investment decisions on a day-to-day basis. Armed with discretionary authority over the account, the dedicated manager hired by the investor actively makes investment decisions pertinent to the individual, considering the client's needs and goals, risk tolerance, and asset size.
A SMA is a portfolio of assets managed by a professional investment firm. In the United States, the vast majority of such firms are called registered investment advisors. These firms operate under the regulatory auspices of the Investment Advisors Act of 1940 and the purview of the U.S. Securities and Exchange Commission(SEC). The portfolio manager is responsible for day-to-day investment decisions. SMAs differ from pooled vehicles like mutual funds in that each portfolio is unique to a single account (hence the name). In other words, if you set up a separate account with Money Manager X, then Manager X has the discretion to make decisions for this account that may be different from decisions made for other accounts.
Recently terminated Advisers We work with financial advisors recently terminated by their broker-dealer. Many terminated advisors end up spinning their wheels and wasting time working with firms that don’t understand the sensitive nature of the road. Wasting time working with a firm that doesn't’t truly understand how to help can be devastating to your business. It’s imperative that you limit the amount of down time you have in-between firms. We also have the knowledge to guide you through the legal maze of FINRA rules and regulations that you are about to enter. We are legal counsel. However, there are many situations that will require the services of a good attorney. We work to help ensure that your transition from one firm to another is handled correctly and your CRD language is appropriate. If your goal is to remain in the financial services business and find the right firm or platform provider for your clients, your business and your family, then we can help you in your search. We work with some of the best firms in the industry; With these connections we can find the right fit for you.
Retained ServicesWe work to assure your success does not end once our initial consulting arrangement is complete. We maintain an ongoing relationship with you and your business in order to provide guidance, support, and strategic direction as necessary through our retained services program. No matter where your business and the future take you, we will be at your side providing the practical and informed insight which makes continued success, realistic growth, and optimal business operations possible. We have the experience and knowledge to help you with your start-up BD. We will consult with you on best practices and help you avoid the pitfalls of starting your new broker-dealer in today's competitive environment.
Personal Consultations You get answers to your specific questions by speaking directly to Hannah Terhune, an experienced hedge fund and international tax attorney. Ms. Terhune's hard-earned knowledge and experience can be put to work to save you unnecessary steps and costly wasted effort. The consultation is an invaluable opportunity to speak to Hannah one-on-one and learn how to achieve more in less time. As a result, you can anticipate that the return on your investment will far outweigh the costs associated with our unsurpassed services. Ms. Terhune's credentials reflect an invaluable resource that combines a well-informed professional practitioner with sound ethical judgment that cannot be overestimated. The expertise required to recommend best solutions and provide sound advice should never be taken lightly. when you are finished with your consultation, you will be impressed and informed about your business plans. Call (307) 213-47322 or Click Here to Request Services
Why Hire Us? When you hire us for hedge fund you get a unique combination of securities, tax, and international experience, focused on the trader niche. We are one destination for special hedge fund and trader tax needs. We think we have the best set of offering documents based on the current and ever changing federal, state, and offshore securities, commodities, and tax laws. We aim and deliver quick turnaround times. We understand that clients want to begin business as soon as possible. We conceive, structure, and deploy the best strategies. Our customers value our one-stop shop relationship. We help you start your business and continue to assist you. Our tax services affiliate handles accounting, software, and tax compliance, including all tax matters (tax planning and tax returns). Only one thing counts with us and that is our customer relationships!
Thank you for Reading our Website!We offer corporate “white glove” concierge service to select clients. We set up many types of funds, provide business advice and offer ongoing support to all clients. We try to help people as their needs evolved. Our best ideas are not on this website. Are you trying to develop a tax or regulatory footprint outside of your home country? We offer extended office services in Delaware, Florida and in other locations beyond the industry norm. We offer extended residential services in the United States and elsewhere to create a footprint in another country sufficient to assist with banking and brokerage needs. We offer unique ideas and the bandwidth to implement them. We offer tax planning services, tax accounting, books and records preparation, and tax return filing services. If you have a business plan that is unique, know that countries offer “sandbox” regimes to create a license that does not yet fit into an existing regulatory framework. We offer a monthly subscription service that provides awareness concerning developments of law we deem of interest to investment managers as well as investment advisers, both licensed and unlicensed. The span of legal news updates and content awareness covers forex, futures, real estate, crypto, equities and commodities, licensed and unlicensed funds, block chain projects, “sandbox” and “fin tech” projects.
Read helpful articles on hedge funds and international tax planning by Hannah Terhune, a leading hedge fund and international tax attorney. Hannah Terhune's articles are hedge fund and tax planning articles are widely published on the Internet and recommended by TheStreet.com and other respected media. Contact Us for Articles & Reprint Rights
Follow @HannahTerhune
Call Us First We are experts in international hedge funds and tax. Click on any reference below to our leading articles:
Strategic Hedge Fund Planning by Hannah Terhune. Wilmott Magazine Ltd. (Volume 2013, Issue 63, pages 8-11 January 2013).
Trading Foreign Index Contracts? Know the Tax Rules Before You Trade by Hannah M. Terhune and Roger D. Lorence. Stocks, Futures and Options (June 2005).
Capital Management Services Group, Inc. is an authority in the hedge fund industry. It is a forward-thinking law firm focused on creating long-term collaborative relationships with a select group of clients interested in the same. It strives to provide “high touch” service and perform a defined set of legal and other services with impeccable efficiency. We offer professional tax advice, state and federal SEC advice, business planning services, international tax, and tax return preparation.
We cater to high-net worth individuals and businesses in the alternative investment community. We are experienced in wealth management, U.S. and offshore hedge fund formations, incubator hedge funds, spot forex funds, master/feeder funds, commodity pools, commodity trading advisory businesses, investment advisory companies, fund administration, SEC and state investment adviser registrations, compliance with Blue Sky laws, and hedge fund taxation. We offer professional tax advice, state and federal SEC advice, business planning services, international tax, and tax return preparation. You may have an unusual situation that needs special attention. We are ready to help. Perhaps you need extra support in an area, such as year-end accounting or performance audits. Blue-sky filings or Investment Advisor Registration We can help. We offer complete 24/7 access and great working relationships. We are simply second to none. Think outside the ordinary.
Our best ideas are not on this website. When you consult with us, you have access to a unique and desirable blend of personalized,yet, professional experience. Give us the opportunity to put our knowledge and expertise to work for you. We provide high quality services at competitive rates. We offer “white glove” corporate concierge services. We have many ideas and the resources to implement them. Get answers to your specific questions and purchase a consultation with a lawyer. We look forward to connecting with you personally and are confident that you will be impressed. We set up a variety of investment funds, provide business and global tax advice, while offering continuous support services to our clients. We help our clients as their needs evolve and take pride in maintaining relationships with our clients.
Our Commitment Henry David Thoreau wrote: "Do not hire a man who works for money, but him who does it for love of it." We are committed to your business plans and bringing you the best possible options. We are an established and internationally recognized business that serves and educates our clients throughout the industry. We do this by striving for the best results. Above all, we are a law firm. A lawyer is a philosopher and role model. The ability to improve our clients' lives is a privilege that we do not take lightly. There is tremendous power in being able to effect a positive change in our clients' lives. Our aim is to welcome our clients and to provide a comfortable, warm environment for all.