Frequently Asked Questions

What kind of accounts do you manage?

We manage nearly all types of investment accounts that can hold publicly traded securities.

Taxable accounts including:

  • Individual
  • Joint
  • Trusts

Retirement accounts including:

  • IRA’s,
  • Roth IRAs,
  • 401(k)s

Can clients keep their assets where they are and make the changes themselves?

No. A client comes to us to give them guidance on their investments and to have RHS manage their investments based on their best interests and risk tolerance. In order to facilitate this relationship in an optimal manner, we have selected the custodians with the best combinations of low fees and execution capabilities. Furthermore, as we frequently rebalance the client’s portfolio using our proprietary investment models using mean variance optimization – a client trading in their account could jeopardize that optimization strategy.

What are the fees that the custodian charges to hold and trade my assets?

We try to utilize funds that do not carry a transaction fee but on certain core fund assets that do not pay the custodian a holding fee; a minor $49.99 trading fee may be incurred. In those instances, we will use free to trade ETF’s (Exchange Traded Funds) in the same asset class to rebalance and therefore avoid large trading costs over time which would invariably lower the client’s return. RHS uses a very large number of Mutual funds and ETF’s that are free to trade at Schwab in order to keep a client’s trading costs down as we are actively rebalancing and wish to keep trading costs to a minimum.

How often will RHS review a client’s investments?

Generally, we review each portfolio on a quarterly basis.  If circumstances warrant, such as market irregularities or a specific client need surfaces, we will review portfolios more frequently.

RHS also has designed a multitude of processes that allow our firm to identify events that warrant action within a portfolio.

What does ”discretion” mean?

Discretion means simply having the ability to trade in a client’s account without the client’s permission. Many people are uncomfortable with this concept, however, they give portfolio managers “discretion” all the time when they invest in a mutual fund of any type. At RHS, we take the same concept with all your investments and build a globally diversified portfolio with an eye towards “evidence based” investing strategies that may make the difference between retiring and retiring well. What it does not does not mean is that RHS Financial has custody.  Custody means that we would have possession of the client’s funds.  The custodian that RHS utilizes maintains custody which means your assets are safely held in a large, well insured institution like Charles Schwab. 

Does RHS consult its clients when making trades even though you have discretion?

The simple answer to this question is no. Once RHS has engaged with a client and their goals have been outlined as well as their risk tolerance has been measured, RHS will present an appropriate portfolio strategy to the new client. Once that strategy is agreed upon, it will be implemented and continually rebalanced in order to optimize its risk adjusted return. We do this, for two reasons, one because our clients are busy people and do not need to be bothered by the day to day implementation of their investment strategy but rather reap the rewards thereof. And second, and most importantly, long term execution of many of our strategies involve a great deal of engagement in both trading and the markets. If our clients are to be successful in their own careers and endeavors, they do not need to be distracted by frequent interruptions asking permission for trades in an already mutually agreed upon investment strategy.

What does RHS fee structure for Investment Management look like and cover?

The fee structure noted below represents RHS Financials’ annual investment management fee which is billed quarterly in advance.

Annual fee schedule:

  • 1.00 % on the first $500,000.00;
  • 0.95% on the amount in excess of $500,000.00 but not greater than $1 million;
  • 0.90% on the amount in excess of $1 million, but not greater than $2.5 million;
  • 0.80% on the amount in excess of $2.5 million, but not greater than $5 million;
  • 0.70% on the amount in excess of $5 million.

These fees do not cover the transaction fees for purchasing or selling mutual funds, if there are any.  We will typically invest in no-load, institutional class mutual funds, which do not carry a front-end sales charge or a deferred sales charge.  Institutional share classes normally offer lower operating expenses.  Trading fees will be minimalized, when possible, as part of our Investment Management services.  Trading fees typically are less than .01% (oftentimes much less) of the assets being managed on an annual basis.

Does RHS charge extra for its Financial Planning services?

No. At RHS Financial, we do not charge an extra fee for financial planning, ever! All financial planning services are included in your investment management fee. Risley Sams is a CFP (Certified Financial Planner) and feels it is his duty and obligation to create a financial plan that works for each and every one of his clients. We like to say, if it has a $ sign in front of it, you should call us about it. We help our clients be successful because of a healthy combination of strategic Financial planning AND investment management. We offer a complementary account aggregation tool to all of our clients called Emoney Advisor software that helps them look at their entire financial picture and helps us better track a client’s progress towards their financial goals.

We actively encourage all of our clients to develop an estate plan, however, since we are not attorneys, we cannot create an estate plan. We are happy to refer our clients to a select group of estate planning attorneys and once produced, help our clients implement their new estate plan.

How do you measure my tolerance for risk?

We use both a quantitative and qualitative test to measure each client’s tolerance for risk. This “doublecheck” helps confirm that we have accurately measured the tolerance for risk and makes for a proper “fit” for each portfolio.

Where are my assets held?

Your assets will be held at an outside custodian, either Charles Schwab Institutional or Interactive Brokers. In some cases, client’s assets will be held at both firms depending on the strategy employed. RHS Financial is not a brokerage itself and has an agreement with these custodians to manage and protect our client’s assets. Rest assured, both custodians are SIPC Insured (up to $500,000) and also carry additional insurance. While we can trade your accounts, we do not have direct access to the funds in your account.

How do I know that you do not have any conflicts of Interest?

We are fiduciaries at RHS Financial. Simply put, we must act independently and place our client’s interests first. We do not accept commissions and we do not sell any financial products that have a commission attached to them.

If you don’t get commissions, how do you get paid?

We charge simply based on a percentage of the assets we manage. The more assets we manage, the lower the percentage we charge. This fee arrangement puts us on “your side” of the table. The better you are doing, the better we are doing. Simple. Furthermore, all financial planning, consulting, meetings with your CPAs and attorneys are included in this fee. Our fees are billed quarterly and deducted automatically.

How long am I obligated to work with you?

There is no ongoing obligation to work with RHS Financial. We would hate to see you go after starting with us, however, it is your money and we do not lock you in. Any unearned fees would be immediately returned to you and you would have accounts in your name at the custodian to do with as you please.

What is your wealth management approach?

We see our clients as micro-entrepreneurs building their own wealth engines for success. Our clients value a truly independent financial advisory team to help them plan, invest and make smart decisions with their money. Our clients get access to the lowest cost, most academically researched institutional investments and strategies along with strategic independent financial advice. We give our clients technology that allows them to monitor all of their assets everywhere and we diligently monitor progress towards our client’s goals.

We are invested in our clients’ success. Like an angel investor does for an entrepreneur, we provide our clients with guidance, support and service to “clear the path” as best we can so that they can build and protect the kind of meaningful wealth they deserve. (Learn More)

What’s your investment approach?

By focusing on what the client can control and minimizing unnecessary risk, we believe a client will garner a higher rate of return over the long term. Simply, rather than trying to “beat the market”, we seek to outperform our peers by diversification, controlling costs, minimizing taxes and concentrating on a few basic fundamental and technical factors. (Learn More)

Do you use alternatives?

We do employ alternative investments in vehicles that are low cost and designed to help enhance returns. We do not employ expensive, illiquid hedge funds as part of our strategy, rather, we use transparent 1940 act regulated mutual funds and low cost Exchange Traded Funds (ETF’s) to gain exposure to these asset classes and trading strategies. We do this because it is in the client’s best interest and the investments are liquid and transparent.

How do I get started?

Contact us today to schedule a confidential, no obligation initial appointment. 415.495.2900