Frequently Asked Questions
Who holds my money?
Who is Royal Alliance Associates?
What is your affiliation with AIG?
Are you employed by Royal Alliance or Pershing?
How safe is my money?
Who watches Cassaday & Company, Inc.?
In the event of a natural disaster or other major regional emergency, will I still be able to contact Cassaday & Company to conduct business?
How do I know that you won’t run off with my money?
What is your average sized managed account?
How can I be assured that I will receive the same attention as your larger accounts?
Do you have a minimum account size?
What are your fees?
Do I have to sell all of my current investments to work with Cassaday & Company, Inc.?
Do you confer with me before doing any transactions?
Who holds my money?
Our custodian is Pershing LLC, located in Jersey City, New Jersey. Pershing was founded in 1936 and is the largest independent clearing/custody firm. Pershing is a division of The Bank of New York Melon Financial (NYSE BNY). The Bank of New York, founded in 1784 by Alexander Hamilton is the oldest bank in the nation. In 2008, BNY had $237.5 billion in assets and $13.6 billion in revenues.
Who is Royal Alliance Associates?
Our broker dealer (BD) is Royal Alliance Associates, Inc. Royal is an independent broker dealer and an unaffiliated third party. While giving us access to the securities markets, Royal provides compliance and supervisory oversight for our clients.
What is your affiliation with AIG?
Royal Alliance is a subsidiary of the AIG Advisor Group which is a subsidiary of AIG and was purchased in 1999. The Federal Reserve agreed in 2008 to take a nearly 80 percent stake in the AIG, in exchange for an $85 billion loan and AIG has received additional guarantees since that time.
Here are some important facts:
- Cassaday & Company, Inc is not owned by AIG nor any subsidiary of AIG. Cassaday & Company, Inc is an independent organization that uses subsidiaries of AIG to provide access to markets, legal and compliance services.
- Cassaday & Company employees are not employees of AIG or any of its subsidiaries.
- Royal Alliance maintains a balance sheet separate and distinct from AIG’s. Royal Alliance’s is financially strong in terms of its regulatory ratios and its finances are statutorily required to be separate from those of AIG. The assets of Royal Alliance are not assets of AIG and cannot be used to meet its obligations.
- Our clients’ assets are held at Pershing, LLC, they are not held in the direct custody of Royal Alliance or AIG. Pershing is a subsidiary of The Bank of New York Mellon Corporation, an organization that is not an affiliate of either AIG or Royal Alliance.
- In our view AIG’s recent problems, which are not related to Royal Alliance in any way, do not impact our clients, their investments or our ability to act as investment advisors and conduct our business for our clients.
- Our decision to continue to use Royal as our BD is totally dependent on the quality of this relationship in terms of our ability to provide our clients with the most competitive array of services available. This has not changed as a result of AIG’s problems.
Are you employed by AIG Royal Alliance or Pershing?
No. We are employees of Cassaday & Company, Inc. Royal and Pershing are independent third parties that provide services to us.
How safe is my money?
Your accounts are insured against the failure of Pershing or Royal by Securities Investor Protection Corp. (SIPC), a U.S. Government-chartered corporation. Accounts are insured by SIPC up to $500,000 (maximum of $100,000 in cash). Additional insurance is provided by private insurers up to an unlimited account value. An explanatory SIPC brochure is available upon request or at www.sipc.org.
Note: This does not protect your account from market loss.
Who watches Cassaday & Company, Inc.?
Royal Alliance Associates provides legal, compliance and supervisory oversight. Representatives of Cassaday & Company, Inc. must demonstrate that we have followed industry standards in terms of investment recommendations and their suitability for clients. We have an on-site audit conducted by Royal on average twice per year. At this audit, our books and records are reviewed over 1 1/2 to 2 days to ensure that we are complying with all industry rules and regulations as well as adhering to Royal’s strict procedural requirements.
In the event of a natural disaster or other major regional emergency, will I still be able to contact Cassaday & Company to conduct business?
Cassaday & Company, Inc. has a disaster plan in place so that in the event of a natural disaster or other major regional emergency, we can return to normal operations as soon as possible.
How do I know that you won’t run off with my money?
All checks from clients must be made payable to Royal Alliance Associates. Cassaday & Company, Inc. never has access to your money or assets. We can generally only move money from your account in the following fashion:
- A wire transfer to another account in the exact same name at another institution with your written permission.
- A check payable to the parties listed on your account registration (e.g. Mr. & Mrs. Jones) and mailed to your address of record.
- Other transfers are possible but only with the client’s express written permission and back-up verification and authorization from Royal Alliance and Pershing.
What is your average sized managed account?
Our fee-based managed accounts average more than $1,200,000 per household.
How can I be assured that if I have a modest-sized account, I will receive the same attention as your larger accounts?
Based on our systematic management process, our accounts are very homogeneous as our clients all own what we believe are the very best choices in all categories. Irrespective of size, our accounts generally own the same investments. Therefore we manage our accounts based on our opinion of a specific holding and if our opinion changes, we make changes on all of our accounts at once. No one goes to the front of the line or gets preferential treatment.
Do you have a minimum account size?
Yes, $500,000.
What are your fees?
Our Fee Schedule:
- 1.20% on the first $500,000
- 0.95% on the next $500,000
- 0.75% on the next $1,000,000
- 0.50% on the next $3,000,000
- $5,000,000 and above = Negotiable
Cassaday & Company requires a minimum fee of $6,000. Clients whose fees would not meet the minimum will be manually billed to one account until 1.2% of their total account value is greater than $6,000.
There may be wholesale transaction charges associated with changes to the portfolio; Cassaday & Company, Inc. receives no commissions in this arrangement.
Do I have to sell all of my current investments to work with Cassaday & Company, Inc.?
No. We will not force you to sell any investments. Some investments will need to be sold in order for Cassaday & Company, Inc. to be able to manage them for you. Most investments will transfer to Pershing in kind without having to be sold.
We will recommend changes that we believe could improve your portfolio with an eye toward the tax consequences: penalties and charges associated with any sale transactions.
Do you confer with me before doing any transactions?
Initially, yes. We will explain our initial transaction recommendations to you and get your input and approval. However, all future transactions will be done at our discretion with the mailed confirmation being your only notice.
Any investments that you bring to us and specify should not be sold will remain in the account until we receive instructions or permission to sell.
Additional Questions? Please contact us at Info@cassaday.com.
Cassaday & Company, Inc
8180 Greensboro Drive
Suite 1180
McLean , VA 22102
www.cassaday.com
703-506-8200 Toll Free 800-672-2102 Fax 703-506-8255
Investment Advisory Services Offered Through Cassaday & Company, Inc. Securities Offered Through Royal Alliance Assoc. Member FINRA SIPC, an Unaffiliated Third Party
