Frequently Asked Questions about Our Firm

Answers to Frequently Asked Questions

Click on a question to read the answer. If you can’t find an answer, please contact us so we can help you. We strive to provide a comprehensive resource.

Overview

What is a Registered Investment Adviser

A Registered Investment Adviser is a fiduciary who has a duty of loyalty to clients and must deal fairly and honestly with them. Any person or entity that holds itself out as a financial planner or investment manager must be registered with the Securities and Exchange Commission or a State Regulatory Body as a Registered Investment Adviser.

Why do I need an investment advisor?

There are many reasons. Many clients view us as their trusted professional advisor along with their CPA and estate attorney. Most are too busy or do not want to manage their own investments. Others find that they have been mismanaging their funds and want advice. In some cases, a change in circumstances can change how you deal with your wealth. You may need professional advice for many reasons but usually because you expect a change in your life circumstance or want to be sure you are making the right choices. Hiring an investment advisor often reduces anxiety over wealth management in volatile markets and can free up your time for more enjoyable pursuits.

Why should I consolidate management accounts with you?

A significant percentage of the money we manage came to us as a result of clients consolidating assets from other firms. This helps avoid duplicating investment approaches that may not be in your best interest. Further, it gives your heirs peace of mind that if a situation arises where they need to step in, they have one advisor with whom to discuss your complete financial picture.


Services

How do you differ from other advisors?

In many ways. We pride ourselves on a holistic approach to wealth management. We look at your entire financial picture, not just at products or services we can sell you. Our investment management process is distinguished by quality selection and a disciplined buy and sell strategy. Other managers often stay fully invested regardless of fear in the market that leads to declines in asset prices. Our approach is designed to provide you with superior long-term returns while reducing risk.

Do you offer wealth planning services on a standalone basis?

Yes, we offer comprehensive or stand-alone wealth management planning. Before beginning the process, we will listen to you about your goals and objectives to determine the appropriate scope of a relationship. From there, we can move forward with the specifics of a creating a plan tailored to your needs.

Do you provide legal, tax or accounting services?

GC Asset Management has several colleagues we can refer you to, or we can research additional service providers and make a recommendation. Otherwise, any financial planning recommendations requiring legal, tax or accounting can be coordinated in a collaborative approach with your specialists.

How often do you meet with clients?

We meet with our clients at least annually to review their portfolio, their investment policy statement and their overall wealth management plan.

Do you work with out of state clients?

Absolutely. While we are located in California, approximately half of our clients are out of state. Just let us know where you are located.


Accounts

Can I rollover my 401(k) or 403(b)?

Yes. Assets can be rolled over from 401(k) and 403(b) plans. We also manage a wide range of other retirement accounts including: Contributory IRA’s, Roth IRA’s, SEPs, SIMPLEs, ESOPs, 457 Plans, Defined Benefit Plans, and Non-qualified Defined Contribution Plans.

Do you provide statements to your clients?

Yes, you will receive monthly statements and trade confirmations directly from the custodian. This is important assurance that your assets are being reported accurately.

What types of accounts qualify for investment management?

Individual, corporate, municipal, estate, trusts, and approved retirement plans.


Investments

Do you invest in individual stocks or mutual funds?

We invest in individual domestic stocks (and/or fixed income) and exchange traded funds (ETFs). With our investment minimums, we can structure a diversified portfolio tailored to your goals and objectives. Mutual funds were created to diversify small investments. Investment advisors managing with mutual funds subject you to double layers of fees; theirs and that of the mutual fund. Most importantly, our management fee is lower than the typical actively managed mutual fund.

How many investment strategies do you offer?

Our investment strategies are tailored to the individual client’s goals and objectives. You will complete a questionnaire to determine an appropriate strategy suited for you. We then discuss those results to create your customized portfolio. We offer investments in domestic equities, international equities, alternative investments, taxable and tax-free fixed income, and options for income and hedging. Fixed income investments are tailored to the clients individual needs with closed-end-funds. Our Secured Cash Income Strategy provides short-term income that can offer yields well in excess of taxable fixed income and certificates of deposit.

Are equity allocaitons always 100% invested?

First, during times of full investment we maintain 5% to 10% of your assets in cash to take advantage of opportunity. Our proprietary computer models occasionally identify periods when overall market risk far outweighs potential reward at which time a greater portion of assets are moved to the protection of money market funds. Further, several of our strategies may go completely to money market funds during times of extreme fear.

How often do you make trades in clients’ accounts?

GC Asset Management does not make trades at set intervals, rather portfolio holdings are reviewed on a continuous basis and we make trades as we deem appropriate. We generally sell a holding for any one of three reasons: 1) Price targets. 2) Deteriorating financial condition of the asset. 3) Market conditions that indicate increased volatility.  It is usually better to sell and move on rather than wait and hope for a negative situation to improve. If we sell a position for any of the above reasons and it meets our buy criteria in the future, we may reacquire the stock at a later date.

What is active investment management?

Active investment management seeks to reposition assets as company and financial markets change, whereas buy and hold often exposes assets to undue vulnerability, volatility and often under-performance. History has shown that companies and their stocks can go through volatile swings to outright failure despite the most optimistic outlooks. There is no denying that economies, markets, and business are more volatile than decades ago. For that reason, we embrace the belief that your assets deserve the greatest attention toward preserving and enhancing them for your long term financial goals.

How are managed investments allocated?

Your portfolio asset allocations will be determined by your Investment Policy Statement that addresses you goals and objectives in relation to your time horizon and comfort with volatility. In selecting your investments, GC Asset Management uses proprietary computer models for each investment strategy to screen for investments according to risk/reward ratios that are most favorable to your portfolio construction.

Do clients prefer active investment management?

Clients prefer active management because their investments are monitored continuously and market exposure is managed according to economic conditions, business outlook, and fear in the markets. Additionally, our active management approach provides reduced volatility, and limits your assets exposure to down markets, making your long-term goals more manageable.

Do you have information on your strategies performance?

To demonstrate the quality of our models, we can show clients back-tested performance of our equity strategies to 2001. We can review them at your request. However, each client’s portfolio allocation will be unique to their specific needs and circumstances.


Protection

Will Client information be kept confidential?

Absolutely. We don’t share your information with anyone outside of our firm without your approval.

Do you custody clients’ assets at your firm?

No. Your assets are custodied under the protection of TD Ameritrade Institutional. You then authorize GC Asset Management limited powers to trade your account and to instruct the custodian to deduct management fees.

Where are my assets held?

For your safety, GC Asset Management uses TD Ameritrade Institutional to custody your assets. In the case of variable annuities, those accounts are typically held at the issuing insurance company. Assets are always held in your name and you retain full control of the account.

What keeps you from running off with our money?

You are protected in numerous ways. 1) GC Asset Management powers are limited to trade your accounts and to instruct the custodian to deduct management fees. 2) GC Asset Management does not take investment checks payable to us or an advisor. Investment checks are made payable to the custodian of your account. 3) You can track your account information online and will receive trade confirmations and statements directly from the custodian. All activity conducted the previous month is itemized on the brokerage statement.

If you don’t hold my assets, how do you manage my account?

When your account is established, you provide GC Asset Management with limited trading authority. This authority allows us to open and close trades among securities within your account.

How are my assets protected?

Your assets are custodied with TD Ameritrade Institutional (TDAI) and cannot be withdrawn by GC Asset Management except to deduct agreed upon management fees. You have access to your money at all times. The Securities Investor Protection Corporation (SIPC) provides insurance against insolvency and fraud to a maximum of $500,000 in securities per account. TD’s money market accounts are insured by the FDIC to a maximum of $250,000 per account. TD Ameritrade Institutional has purchased additional insurance through Lloyds of London to a maximum of $149.5 million per client account.


Fees

What are your fees?

Investment Management fees are:

New assets are pro-rated for the remainder of the initial calendar quarter. Fees are then charged by calendar quarter in January, April, July and October. An example $5 million dollar account would bill the first $2 million dollars at 1.00% and the next $3 million dollars at 0.90%.

Financial Planning fees are:
$200 per hour or fixed price based on services provided. A financial planning agreement between GC Asset Management and the client will detail the work to be completed and an estimate of the total cost. GC Asset Management can provide stand-alone or comprehensive financial planning services. Please contact us with your questions.

How can you save me money?

We can help you examine virtually all aspects of your financial life to identify areas where you can first save money by reducing outflows and second enhance your net worth through tax-efficient wealth strategies. Through our comprehensive wealth management process we will help you review your insurance policies including life, property and casualty, disability and health insurance and by properly investing portfolios to take advantage of current tax laws.

Are clients locked into a long-term contract?

No. You can terminate your relationship with GC Asset Management at any time. Should you need to make that change, you will be provided with a pro-rata refund for the remainder of the quarter in which you cancelled.

Do you charge a setup fee for money management services?

No. When a client engages us, the initial quarterly fee is pro-rated for the remainder of the first quarter of service. After that, a client is billed on a calendar quarterly basis.

Do you have a minimum investment requirement?

Currently, we manage client investments totaling at least $250,000. However, we can make exceptions on a case-by-case basis.

Are investment management fees tax deductible?

Yes. However, mutual fund expenses are not deductible, that’s why we don’t use them. Refer to IRS Publication 550, Chapter 3 and IRS Section 212 that permits an itemized deduction for tax and/or investment advice, subject to certain restrictions.

“Investment counsel and advice. You can deduct fees you pay for counsel and advice about investments that produce taxable income. This includes amounts you pay for investment advisory services.” – IRS Publication 550

Are fees taken from a retirement account a distribution?

Management fees taken directly from your retirement account are not considered a distribution and are not subject to taxes or penalties.