Quint Capital Corporation (BD) – Quint Capital Management (RIA) Form CRS – Client Relationship Summary June 2020
Introduction Quint Capital Corporation, (QCC) provides Investment Management, Securities Brokerage and Insurance Brokerage Services to Individuals, Corporations, Institutional and other types of clients. Brokerage and Investment Advisory services and fees differ. It is important for you to understand these differences. Free and simple tools are available to research firms and financial professionals at Investor.gov/CRS, which also provides educational materials about Broker-Dealers, Investment Advisers, and investing in general.
What Investment Services Do We Provide? QCC is a Broker-Dealer and an Investment Advisor that offers securities brokerage and investment advisory/management services to a variety of different Clients. QCC does business as Quint Capital Management (QCM) when providing Investment Management Services. Additionally, QCC is a registered insurance agency, with the NYS Department of Financial Services under the name Quint Cap and Quint Capital Benefit Corp., that offers insurance products such as life insurance, variable and fixed annuities, variable universal life contracts and group insurance plans to individuals and corporate clients. The insurance carriers we work with include Nationwide Financial, Principal Financial, Lincoln Financial, Pacific Life and Jackson National.
We will refer to QCM when discussing Investment Management Service and QCC when discussing Securities Brokerage Services.
Securities Brokerage Services When QCC acts as a Broker-Dealer, we offer clients equities (both listed and OTC), US Treasury Securities, mortgage backed securities, municipal securities, corporate bonds, mutual funds, variable insurance products and various private securities offerings. We offer mutual funds from numerous mutual fund families that include Vanguard, Fidelity, Black Rock, American Funds and Lord Abbet. Our mutual fund offerings include both open ended funds and closed end funds, from a wide range of equity and fixed-income asset categories.
Investment Management Services When acting as an Investment Advisor, QCM offers its clients both discretionary and non-discretionary Investment Management Services that include Separately Managed Accounts, Pension Consulting Services and Wrap-Fee Programs. QCM’s clients include Individuals and Corporations.
More information about our services can be found in our Form ADV, Firm Descriptions and Types of Clients.
Given My Individual Financial Situation, Should I Choose an Investment Advisory Service or a Brokerage Service? Under What Conditions should I Make These Choices? Each person seeking investment advice is different. Typically, a new client to our services select us because they lack the experience, time, and the desire to manage their assets. Additionally, they become comfortable with the specific Advisor they are in discussion with, both on a professional and personal level. Because of the complexity of the financial marketplace, retaining a professional can make sense to many investors. Furthermore, choosing a brokerage service or an investment advisory service can often come down to how you prefer to be charged in terms of fees and the frequency of transactions in your account. Clients who will have fewer transactions in their account and do not require extensive investment advice or investment management services may benefit from a brokerage relationship. However, clients who wish for us to actively manage their accounts, will most likely benefit from paying a management fee as opposed to transactional costs.
How Will We Choose Investments to Recommend to You? If you choose to do business with us, we’ll meet with you to discuss your investment objectives and from those meetings, will develop an investment strategy with you. The investment strategy for each individual client is based upon the objectives stated by the client during consultations. The client may change these objectives at any time by modifying their investment objectives on their Client Profile.
What is Our Relevant Experience, Including Licenses, Amount of Experience in This Industry, Education and Other Qualifications? What do These Qualifications Mean? Our Advisors hold various securities licenses issued by the relevant Regulatory Agencies such as the Financial Industry Regulatory Authority (FINRA) that allow them to lawfully engage in securities transactions in the United States. They have generally participated in the Securities Industry for an extended period of time, i.e., several of them for in excess of twenty-years. The vast majority have earned academic degrees in a variety of disciplines from various accredited universities.
Investment Reviews QCM recommends annual or more frequent accounts review meetings with each client. Account reviews typically cover a wide range of topics that include asset allocation, portfolio holdings and investment performance. At each review, the suitability of the investment strategy is confirmed with the client. Additionally, QCM provides written investment reports to each investment client on a quarterly basis. Reports show asset allocation, portfolio holdings and investment performance. What Fees Will You Pay? Investment Management Fees QCM charges fees for its Investment Management Services that are described below:
- Initial Fees (Strategic Portfolio Design Fee) – to evaluate a client’s current investment position and recommend suitable changes in portfolio mix and emphasis. This may be charged separately from ongoing fees for portfolio management. A negotiated initial fee is proposed based on an estimate of the time required to provide the appropriate level of service and the level of complexity anticipated in the relationship. Initial fees range from .5% to 1.5% of AUM.
- Normal Hourly Rates – upon which estimates are based, are approximately $300 per hour.
- Quarterly Fees for Portfolio Management – are primarily based on a percentage of the value of the investments under management; however, such services may also be provided for a fixed retainer payable quarterly in advance.
- The Standard Fee – is generally up to 50 basis points per quarter or two percent (2%) per year. This applies to all services including any sub-advisory fees. Total annual fees cannot exceed three percent (3%) of assets.
- QCM Charges Wrap Fee Program Clients – a maximum of 2% annually (.50% quarterly). QCM evaluates annually whether a Wrap Fee is in best interest of the Client vs. a traditional commission-based account.
Exceptions to the established fee schedule may be negotiated on an individual basis based on certain criteria including relationship history, type of assets, potential account size, expected activities, volume of transactions or a requirement for more or fewer services.
In order to encourage interaction with our clients, there is no limit placed on the amount of professional time made available for portfolio related or general financial discussions. QCM may bill separately for additional services; particularly where research, further analysis, projections, tax preparation, etc. are required. One or more of the following billing methods may be recommended, depending on the services:
Brokerage Services Fees The majority of clients will pay the management fees referenced above. However, some clients who prefer to pay transactional fees will be subject to our commission schedule summarized below.
- Equities and Fixed Income: Commissions for equity and fixed income transactions begin at $75 per trade and will fluctuate depending on the number of shares/units transacted and the value of the underlying security.
- Options: The current minimum commission for option purchases is $35. The current minimum commission for option sells is $35 or 100% of the principal, whichever is less.
- Mutual Fund Trail Retention Policy: When a mutual fund is held in a retail commissionable account, QCC retains the administrative or 12b-1 fee that helps offset processing and general operating costs. For fee accounts that hold no-load mutual funds, QCC similarly will retain the administrative or 12b-1 fee. No-load mutual funds are classified as those without a front-end or back-end sales concession and with 12b-1 fee of 25 basis points or less.
- Mutual Fund Trails and Direct Purchases: All mutual fund orders, including trails and direct purchases, are exempt from minimum ticket requirements for clients.
- Other Fees: A $5.95 handling/processing fee, which is not considered in payout calculations, will be charged on most transactions.
Please refer to our commission schedule, available upon request, for more details.
What Are Our Legal Obligations to You When Providing Recommendations as Your Broker-Dealer or When Acting as Your Investment Advisor? When we provide you with a recommendation as your Broker-Dealer or act as your Investment Adviser, we have to act in your best interest and not put our interest ahead of yours. At the same time, the way we make money may create some conflicts with your interests. You should understand and ask us about these conflicts because they can affect the recommendations and investment advice that we provide you with.
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, also known as your rate of return. For additional information, please see Form ADV, Part 2A brochure regarding QCM’s fees.
How Might Our Conflicts of Interest Affect You, and How Do We Address Them? Here is an example of a potential conflict of interest and how we mitigate that conflict. There are two Investment Management alternatives that are offered for QCM’s Wrap Fee Program clients – Internal Portfolio Management (IPM) and External Portfolio Management (EPM). The potential conflict is purely economic. For IPM, the internal investment professional receives a greater amount of compensation, in consideration of the portfolio management service they provide. For EPM, the internal investment professional receives less compensation since the external portfolio manager requires compensation in consideration of their services. We mitigate this conflict by clearly explaining to prospective clients all of the available portfolio structure alternatives and their applicable fees. It is the client that ultimately decides which alternative is more appropriate for them, based solely on their personal preference. In general, the larger institutional accounts are more inclined to opt for the EPM alternative.
How Do Our Financial Professionals Make Money? All of our Advisors earn a portion of the fees that client accounts are charged. They can also earn fees for time rendered or services provided beyond the scope of the normal investment process. For fee-based accounts in general, since fees are charged as a percentage of the asset value of the account, the larger the account value, the larger the fee that is charged and the more the advisor will earn. If the Advisor is motivated by economics, it will benefit them to increase the value of the account to the greatest extent possible since that will increase the amount they earn. If the value of the account increases, it also benefits the Client, who is the beneficial owner of the account. Therefore, in this scenario, the interests of the Client and the Advisor are aligned, which constitutes a productive relationship between all parties.
Please note that for commission-based transaction accounts, in the event there are a minimum number of annual transactions executed, it may constitute the more advantageous structure for clients. However, an excessive amount of commission-based transactions is generally considered to benefit the Advisor vs. the Client since the aggregated value of the commissions directly reduces the portfolio rate of return. Additionally, it may be prudent for the client to retain a particular investment, however, selling it to earn a commission for the Advisor may create a conflict between the Client and Advisor. This is why we generally discourage commission-based vs. fee-based compensation that is directly correlated to account value, described above.
Do Any of Our Financial Professionals Have a Legal or Disciplinary History? Visit Investor.gov/CRS for a free and simple search tool to research our firm and financial professionals. This information is also available on brokercheck.finra.org or by requesting a copy of our Firm Brochure Part II.
Who Will Be My Primary Contact Person? The Advisor at our firm that you choose to work with will be your primary contact. Alexander Quint is the Chief Compliance Officer; should you have any questions, comments or concerns with the financial professional serving your account. Contact information is as follows:
Alexander N. Quint
230 Park Avenue Suite 908
New York, NY 10169-0499
(212) 682 5090 – Tel
(844) 527 5549 – Toll Free
(646) 257 5825 – Fax
(917) 885 6731 – Mobile