Form ADV Part 3 – Client Relationship Summary – June 30, 2020

 

 

RGT Wealth Advisors, LLC (RGT, we or our) is registered with the Securities and Exchange Commission (SEC) as an investment adviser. Brokerage and investment advisory services differ, and it is important for you to understand these differences. This document is intended to help you start a conversation with your RGT advisor about key and important topics related to our services. Free and simple tools are available to research firms and financial professionals at https://investor.gov/CRS, which also provides educational materials about broker-dealers, investment advisers, and investing.

What investment services and advice can you provide me?

Services: RGT offers investment management, financial planning and family office services to individuals and their affiliated entities, who seek services for personal, family or household purposes. We provide these services to you upon execution of a client service agreement (client agreement). We manage your portfolio in accordance with an investment policy statement prepared specifically for you, at the onset of our relationship, following an analysis of your long-term financial goals and objectives and your views on risk and liquidity needs. Based on your investment policy statement, we will build your portfolio from a mix of investments in different asset classes. We categorize asset classes in the following way: fixed income, global equity, alternative investments, and private investments (as appropriate). Within each asset class we utilize a variety of investment vehicles to build your portfolio such as mutual funds, exchange traded funds, balanced funds, partnerships, and outside separate account managers.

 

We will manage certain types of accounts on your behalf as designated in your client agreement. We provide investment management services on both a discretionary and non-discretionary basis. For discretionary accounts, you will have granted us full trading authority through your client agreement and the custodian’s account paperwork. Within the discretionary accounts we manage for you we determine which investments to purchase and sell on your behalf. In making investment decisions, we seek to adhere to the investment strategy outlined in your investment policy statement. For investments made in non-discretionary accounts, you will be required to take action to implement the trades that we recommend (e.g., by completing subscription or redemption paperwork for investments in certain pooled investment vehicles or by authorizing specific trading activity in a non-discretionary account). We monitor our recommended investment portfolio on a continuous basis. Our analysts review your managed accounts with the assistance of software programs as further described in our ADV Part 2A Brochure. In addition, we formally review your accounts each quarter in connection with the creation of quarterly account reports and review them on an ongoing basis as circumstances warrant.

 

Financial planning and family office services are available to you for a separate financial planning fee if you desire that we assist you with strategic planning and coordination of items such as financial independence planning, estate planning and strategy, risk management, foundation management, tax planning, personal budgeting and bill processing.

 

Requirements to open and maintain an account: We generally require a $3,000,000 minimum account size. In certain circumstances we may waive our minimum account size. We generally recommend that custodial accounts we will manage for you be established at Charles Schwab or Fidelity who are both registered broker-dealers.  RGT is independently owned and operated and not affiliated with Charles Schwab or Fidelity. We will assist you in opening brokerage accounts, as appropriate, based on your client agreement.

 

Additional Information: You can find additional information in our ADV Part 2A Brochure by clicking this link: RGT Brochure.  See Item 4 regarding our services and Item 13 regarding our monitoring.

Questions to ask us: Given my financial situation, should I choose an investment advisory service?  Why or why not?  How will you choose investments to recommend to me?  What is your relevant experience, including your licenses, education, and other qualifications?  What do these qualifications mean?

What fees will I pay?

Principal Fees and Costs: We charge fees based on your requirements for our services. Our fees are negotiable, taking into consideration factors such as the amount of assets we will manage for you, the complexity of your financial plan, the type and amount of services requested, and any special circumstances including consideration of aggregation of certain other related clients. It is therefore possible that clients receiving similar services from us will pay different fees.

 

Your client agreement will outline the services we will provide and the investment management, financial planning, and other fees we will charge for those services. Our investment management fees range from 0.25% to 1.00% per year of the assets we manage for you.  We base annual fees for financial planning and family office services on the amount of services you would like for us to provide. Your fees will be calculated and billed quarterly. The more assets you have under our management, the more you will pay in fees, giving us an incentive to encourage you to increase the assets in your account.

 

Other Fees and Costs: You will also incur other fees and expenses charged by third parties including custodians, brokers, mutual funds, exchange traded funds, separate account managers, and private investment vehicles. Depending on the type of transaction, these fees may include brokerage commissions, transaction fees, wire transfer and electronic fund fees, and other fees and taxes on brokerage accounts and securities transactions. In addition, mutual funds, exchange traded funds, and money market funds charge internal management fees that are disclosed in each fund’s prospectus. If you invest in certain private funds that we manage, you will also be charged other fees pertaining to our management services of that fund as described in our ADV Part 2A Brochure.

 

Additional Information: You will pay fees and costs whether you make or lose money on your investments. Fees and costs will reduce any amount of money you make on your investments over time. Please make sure you understand what fees and costs you are paying. You can find additional information in our ADV Part 2A Brochure by clicking this link: RGT Brochure.  See Item 5 regarding fees you will pay us and third parties.

Questions to ask us: Help me understand how these fees and costs might affect my investments.  If I give you $1,000,000 to invest, how much will go to fees and costs, and how much will be invested for me?

What are your legal obligations to me when acting as my investment adviser?  How else does your firm make money and what conflicts of interest do you have?

When we act as your investment adviser, we have to act in your best interest and not put our interests ahead of yours. At the same time, the way we make money creates some conflicts with your interests. You should understand and ask us about these conflicts because they can affect the investment advice we provide you. Here are some examples to help you understand what this means.

 

We recommend custodians to you.  We receive support services, products and other benefits from them (e.g., research and access to educational conferences).  Some of these services and products assist us in better monitoring and servicing your accounts while others benefit our firm. We also have potential conflicts of interest with you if you invest in a proprietary private fund that we manage. RGT or certain of our owners control these funds through their ownership of their general partners.  In addition, one of these funds has a carried interest distribution to certain owners of RGT as described in our ADV Part 2A Brochure. The private funds we manage have made (and may in the future make) investments in funds that are managed by entities whose employees or owners are also our clients.  We also have a potential conflict of interest if we recommend services to you from a banking institution in which one of our managing directors sits on the bank’s board of directors.

 

Additional Information: You can find additional information in our ADV Part 2A Brochure by clicking this link: RGT Brochure.  See Items 6 and 10 regarding our conflicts of interest and Item 11 regarding our standard of conduct.

Questions to ask us: How might your conflicts of interest affect me, and how will you address them?

How do your financial professionals make money?

Our financial professionals are paid a salary and, if eligible, a discretionary bonus at the end of the year. Our employees are also compensated for bringing new business to RGT.

Do you or your financial professionals have legal or disciplinary history?

Yes. In February 2016, we conducted an internal investigation that led us to report two partners in our former California office to the SEC, which opened its own investigation in which we fully cooperated. We terminated the two individuals and various other California staff and closed that office in October 2016.  The SEC brought actions against both individuals resulting in, among other things, the individuals being ordered to pay monetary penalties and receiving various financial industry and regulatory bars and suspensions. The SEC has not asserted claims against RGT or any of its current employees regarding these matters.

 

Two clients brought separate proceedings related to these matters, both of which have been resolved. We have no pending legal or disciplinary matters. You should visit https://investor.gov/CRS for a free and simple search tool to research us and our financial professionals. You can find additional information regarding our legal and disciplinary history in our ADV Part 2A Brochure by clicking this link: RGT Brochure.  See Item 9 regarding our legal and disciplinary history.

Questions to ask us: As a financial professional, do you have any disciplinary history?  For what type of conduct?

 

Additional Information

If you would like additional information about our services or a copy of our latest Client Relationship Summary, please contact our Chief Compliance Officer, Anne K. Hill at ahill@rgtadvisors.com or by calling (214) 360-7000. You may also access additional information about us by reviewing our ADV Part 2A Brochure by clicking this link: RGT Brochure.

Questions to ask us: – Who is my primary contact person?  Is he or she a representative of an investment adviser or a broker dealer?  Who can I talk to if I have concerns about how this person is treating me?