Frequently Asked Questions
Q: What size client portfolios does Peregrine manage?
A: We typically look to work with clients whose portfolios are valued at $500,000 and above, but there are exceptions. Currently our largest client portfolio is in excess of $50 million. Our client base is composed largely of high net worth individuals. For purposes of rendering service, we do not segment clients according to how much money we manage for them. Every Peregrine client should expect the same level of service, regardless of the size of their portfolio.
Q: Do clients sign a contract with Peregrine?
A: Yes. Prior to engaging Peregrine to provide investment management services, the client will enter into a formal Investment Advisory Agreement setting forth the terms and conditions under which the client's assets shall be managed by Peregrine. Clients can terminate the agreement at any point without penalty.
Q: What is meant by discretionary asset management?
A: Clients give Peregrine full authority to make all purchase and sell decisions in the investment portfolio. Thus, there is no pre-clearance from clients for each individual trade that Peregrine effects. This arrangement allows us to manage portfolios in a much more efficient manner.
Q: Does Peregrine take custody of client assets?
A: Typically not. Clients enter into a separate custodial/clearing agreement with an unaffiliated broker-dealer/custodian where the assets are held in the client's name. Peregrine generally recommends that investment management accounts be maintained at Charles Schwab & Co., Inc. for execution and/or custodial services. This recommendation is made based on such factors as Schwab's financial strength, reputation, historical relationship with Peregrine, and its full range of broker-dealer services including its research, execution capabilities, pricing, technology and responsiveness. In the very rare case that Peregrine accepts custody of client assets, it is subject to an annual surprise examination from an independent public accountant. Peregrine does deduct advisory fees directly from client accounts.
Q: Are clients notified of the investment decisions that Peregrine makes?
A: Yes. The account custodian notifies clients of all transactions on a timely basis, provides a comprehensive monthly statement and offers daily account access via the Internet. Additionally, Peregrine provides a quarterly report and on-demand portfolio login capabilities through this website. Thus, clients remain well-informed about all matters pertaining to their investments.
Q: Do Peregrine's advisors personally own the same investments they purchase for clients?
A: Yes. If one were to examine the portfolios of our advisors and the firm's clients who share similar investment objectives, he or she would see very significant overlap in the positions held. That is not to say that the advisors own every position that the clients own or that the clients own every position that the advisors own. However, the similarities between the portfolios are striking. (Keep in mind that we build custom portfolios, so no two portfolios are exactly the same.) At Peregrine, our attitude is that if we don't have enough conviction about an investment to want to own it ourselves, then there is no reason for us to buy it for clients.
Q: Does Peregrine report its investment performance to clients?
A: Yes. Clients can see how their investments are doing over any period during their relationship with Peregrine via on-demand, secure access to an industry-leading provider of web-based investment performance reporting. Additionally, Peregrine provides investment returns via quarterly reports to clients. An unaffiliated third-party calculates the portfolio results based on information provided by the account custodian. Returns are calculated on a Time-Weighted Rate of Return (TWRR) basis. TWRR is a measure of a portfolio's compound rate of growth over a stated time period. This methodology is not sensitive to contributions or withdrawals, which are generally client-driven, so the distorting effects of cash flows are eliminated. TWRR is the industry-preferred method for gauging investment manager performance in most situations.
Q: How is Peregrine compensated?
A: Peregrine receives 100% of its compensation from asset-based advisory fees paid by clients. This approach aligns our interests with those of the client. Our annual investment advisory fee is prorated and paid quarterly, in advance, based upon the market value of the client's assets on the last business day of the previous quarter. Typically, clients elect to have their fee deducted from their account. In the event of a client departure, any unearned fees are refunded. Our fee schedule is published in our Form ADV Part 2A and Form CRS, both found on this website, and is also available upon request.
Q: Does the client bear any other expenses in addition to Peregrine's management fee?
A: Yes. Broker-dealers such as Charles Schwab charge brokerage commissions and/or transaction fees for effecting certain securities transactions, and mutual funds impose management fees and other expenses at the fund level. In conducting our fund due diligence and seeking best execution for clients, we pay close attention to these fees and expenses. Again, when we measure our performance, it will be net of all fees and expenses.
Q: Is Peregrine a financial planner?
A: No. Peregrine does not hold itself out as providing financial planning, estate planning, or insurance planning services. To the extent specifically requested by a client, Peregrine may provide limited consultation services to its investment management clients on matters that are generally ancillary to the investment management process. Any such consultation services shall be rendered exclusively on an unsolicited basis, for which Peregrine shall usually not receive any separate or additional fee. Neither Peregrine, nor any of its representatives, serves as an attorney, accountant, or insurance agent, and no portion of Peregrine's services should be construed as same.