Some customers with so-called managed accounts at Merrill - or those accounts that command a flat fee - may end up paying as much as 50% a year more to have their money managed, according to a new rate schedule obtained by the Wall Street Journal.
The Merrill platform combines five menus, known as managed account platforms, from which advisors select stocks, bonds, mutual funds, and a variety of other investment products. Clients with managed accounts are not charged per transaction, as on traditional brokerage accounts. Instead they pay a flat fee, usually a percentage of what they have in the account.
The main increases will be felt by clients with money in a platform known as Merrill Lynch Personal Advisor. The current fee schedule for the equities section sets a minimum fee of 1% for clients whose accounts hold up to $1 million and 0.65% for accounts of $1 million to $2 million.
Under the new schedule, the minimum will be 1.6% for accounts up to $250,000, 1.4% for $250,000 to $500,000 and 1.3% for $500,000 to $1 million. For $1 million to $2 million accounts, the minimum is 1%.
Source: Wall Street Journal, 1 August 2013
The information contained in this article does not constitute a recommendation, solicitation, or offer by D2 Capital Management, LLC or its affiliates to buy or sell any securities, futures, options or other financial instruments or provide any investment advice or service. D2, its clients, and its employees may or may not own any of the securities (or their derivatives) mentioned in this article.
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