Disclosures for Facet’s Direct Indexing and Alternative Income Strategies
Direct Indexing
For Members utilizing Facet’s Direct Indexing Strategy, Facet uses Orion Portfolio Solutions, LLC to provide sub-advisory services for this Strategy. Members will sign a separate agreement for that service and as part of the service, Orion will charge a fee of up to 0.15% of account assets managed by Orion, collected quarterly in arrears, to cover recordkeeping expenses. Facet does not share in this fee.
The Direct Indexing Strategy invests in individual securities, may hold a large number of securities and may trade frequently in order to meet its goal of being a tax optimized investment.
Alternative Income
Facet’s Alternative Income Strategy invests primarily in mutual funds that only allow withdrawals on a quarterly interval and may restrict the percentage of the fund that may be withdrawn each quarter. This makes the Strategy less liquid than other investments and suitable for longer term investment time frames. Additionally, these underlying funds may not be transferable in-kind to other custodians. If a receiving institution cannot hold the asset, it must be liquidated and transferred as cash, subject to the same quarterly withdrawal limits.
The fees assessed by these mutual funds are greater than typical mutual funds that invest in public securities given their access to private credit and real estate investments.
Given the securities held in the Facet Alternative Income Strategy, you must meet the standards of an accredited investor, as defined by the SEC, to invest in the strategy.