ML no longer supporting investment club accounts and Fidelity no longer opening new club accts?

Kimberly.berry on

To clarify, yes, we had an advisory relationship with a Merrill Lynch team. They came to our monthly meetings and gave us broad market perspectives but did not have any discretion over our account. We paid them a fixed fee of $300 annually plus commissions on trades. The club is 35 years old and we have been with this team for 15 years. The idea/concept of looking at the expense just never came up until now. The group was comfortable with relationship and cost.

I supposed we could pick any platform such as ETrade or TDAmeritrade and still pay an advisor to meet with us and give that market perspective. We were just hoping to find an independent Financial investment firm who could do both - work with us on the type of advisory capacity we've grown used to AND give us access to a platform such as Fidelity.

Sent on my Boost Mobile Samsung Galaxy S(R) 5

-------- Original message --------
From: "Mark Eckman via bivio.com" <user*24054700001@bivio.com>
Date: 11/8/18 11:52 AM (GMT-05:00)
To: club_cafe@bivio.com
Subject: Re: [club_cafe] ML no longer supporting investment club accounts and Fidelity no longer opening new club accts?

You used the word "advisor" and that seemed curious to me. Why do you choose to go to an advisor who then has to go to a broker/dealer to make your transaction instead of going directly to a broker such as TDAmeritrade or ETrade? Back in the days of fixed commissions, that was the only way to reach the market, but not today. I believe both TDA and ETrade are very accepting of investment clubs.

Mark Eckman

On Thu, Nov 8, 2018 at 10:28 AM Kimberly Berry via bivio.com <user*36387200001@bivio.com> wrote:

Our club was informed in early October by our advisors at Merrill Lynch that they can no longer hold our account and that we need to find a new custodian by the end of the year. The reason given was risk management - because we are a partnership of individuals it is too risky to have our account because we could be money laundering etc. They simply don't want to do business with partnerships like ours any more.

We began searching/interviewing new advisors to move our account at year end and thought we had found several, but upon sharing our membership list and partnership agreement with one of them, we were just informed that the custodian they work with, Fidelity, is no longer opening investment club partnership accounts.

Is this affecting current accounts held at Fidelity? Where else might we be able to open an account?

Has anyone else run into this situation?

Mark Eckman

Linda Glein on

If you are looking for 'market perspective' how about subscribing to the Investor Advisory Service and read their commentary out loud at each meeting? the nice thing is this publication is very compatible with the BetterInvesting methodology perspective. You would also get ideas for stocks, and updates on the stocks they follow.

Linda

On Thu, Nov 8, 2018 at 9:27 AM Kimberly.berry via bivio.com <user*36387200001@bivio.com> wrote:

To clarify, yes, we had an advisory relationship with a Merrill Lynch team. They came to our monthly meetings and gave us broad market perspectives but did not have any discretion over our account. We paid them a fixed fee of $300 annually plus commissions on trades. The club is 35 years old and we have been with this team for 15 years. The idea/concept of looking at the expense just never came up until now. The group was comfortable with relationship and cost.

I supposed we could pick any platform such as ETrade or TDAmeritrade and still pay an advisor to meet with us and give that market perspective. We were just hoping to find an independent Financial investment firm who could do both - work with us on the type of advisory capacity we've grown used to AND give us access to a platform such as Fidelity.

Sent on my Boost Mobile Samsung Galaxy S(R) 5

-------- Original message --------
From: "Mark Eckman via bivio.com" <user*24054700001@bivio.com>
Date: 11/8/18 11:52 AM (GMT-05:00)
To: club_cafe@bivio.com
Subject: Re: [club_cafe] ML no longer supporting investment club accounts and Fidelity no longer opening new club accts?

You used the word "advisor" and that seemed curious to me. Why do you choose to go to an advisor who then has to go to a broker/dealer to make your transaction instead of going directly to a broker such as TDAmeritrade or ETrade? Back in the days of fixed commissions, that was the only way to reach the market, but not today. I believe both TDA and ETrade are very accepting of investment clubs.

Mark Eckman

On Thu, Nov 8, 2018 at 10:28 AM Kimberly Berry via bivio.com <user*36387200001@bivio.com> wrote:
Our club was informed in early October by our advisors at Merrill Lynch that they can no longer hold our account and that we need to find a new custodian by the end of the year. The reason given was risk management - because we are a partnership of individuals it is too risky to have our account because we could be money laundering etc. They simply don't want to do business with partnerships like ours any more.

We began searching/interviewing new advisors to move our account at year end and thought we had found several, but upon sharing our membership list and partnership agreement with one of them, we were just informed that the custodian they work with, Fidelity, is no longer opening investment club partnership accounts.

Is this affecting current accounts held at Fidelity? Where else might we be able to open an account?

Has anyone else run into this situation?

--

Mark Eckman

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