XP Advisory US, Inc (“XP Advisory”), formerly known as XP Private, Inc, is a Registered Investment
Adviser formed in the U.S. Securities and Exchange Commission. XP Advisory US, Inc. (hereinafter “XP
Advisory”) has been located in Miami, Florida since November 2014. XP Advisory is directly owned by XP
Inc.
The following paragraphs describe our services and fees. Please refer to the description of the investment
advisory services listed below for information on how we tailor our advisory services to your individual
needs. As used in this brochure, the words “we,” “our” and “us” refer to XP Advisory and the words “you,”
“your” and “client” refer to you as either a client or prospective client of our firm. Also, you may see the
term Associated Person throughout this brochure. As used in this brochure, our Associated Persons are
our firm’s officers, employees, and all individuals providing investment advice on behalf of our firm.
Investment Management Services
We offer discretionary and non-discretionary investment management services. Our investment advice
is tailored to meet our clients' needs and investment objectives. If you retain our firm for investment
management services, we will meet with you to determine your investment objectives, risk tolerance, and
other relevant information (the "suitability information") at the beginning of our advisory relationship. We
will use the suitability information we gather to develop a strategy that enables our firm to give you
continuous and focused investment advice and/or to make investments on your behalf. As part of our
investment management services, we may customize an investment portfolio for you in accordance with
your risk tolerance and investing objectives. We may also invest your assets using a predefined strategy,
or we may invest your assets according to one or more model portfolios developed by our firm. Once we
construct an investment portfolio for you, or select a model portfolio, we will monitor your portfolio's
performance on an ongoing basis, and will rebalance the portfolio as required by changes in market
conditions and in your financial circumstances.
If you participate in our discretionary portfolio management services, we require you to grant our firm
discretionary authority to manage your account. You may limit our discretionary authority (for example,
limiting the types of securities that can be purchased for your account) by providing our firm with your
restrictions and guidelines in writing. If you enter into non-discretionary arrangements with our firm, we
must obtain your approval prior to executing any transactions on behalf of your account.
XP Advisory provides investment management services to clients with an extensive array of products
that allow them to efficiently access the international capital markets. Our full commitment to our clients
eliminates conflicts of interest and ensures that decisions are geared exclusively to producing the best
results.
At XP Advisory, we are committed to being a partner of choice and curating an exceptional suite of
products chosen to fit the needs of clients. We are an open platform but give a full due-diligence review
to each of the proposed products in a client’s portfolio, ensuring that it fits not only their investment profile
but also our investment fundamentals and management team screening.
Investment accounts are subject to the written investment guidelines and investment objectives (the
"Investment Guidelines") as directed by each client and approved by XP Advisory. The Investment
Guidelines may be amended from time to time by written notice from the client. XP Advisory recommends
purchases and sales of domestic and foreign securities and instruments.
The majority of our clients are high net worth individuals and corporations. We know how important it is
to understand the unique needs and perspectives of our clients. Our value-added approach offers the
following advantages:
A personalized boutique approach to navigating risks and opportunities.
We structure each client’s investment portfolios according to an asset allocation model that takes
into account their risk and return objectives.
We emphasize a balanced approach to asset allocation, seeking to diversify the holdings by
products, sectors, and regions of the investments.
Our open-architecture platform allows us to provide a global selection of financial products from a
wide variety of financial institutions.
We remain nimble to the changes in both the financial markets as well as to the personal
circumstances of our clients.
Recommendation of Sub Advisers
As part of our overall portfolio management strategy, we may also recommend affiliated and/or unaffiliated
sub advisers to manage all or a portion of your account. All sub advisers recommended by our firm must
either be registered as investment advisers or exempt from registration requirements. These sub advisers
may specialize in traditional or alternative investments. Factors that we take into consideration when
making our recommendations include, but are not limited to, the following: the sub adviser’s performance,
methods of analysis, fees, your financial needs, investment goals, risk tolerance, and investment
objectives. Once a sub advisory account has been established, we will provide all administrative and
clerical duties that are required to service your account. The sub adviser will have little or no direct contact
with you. Our responsibility to you will be to: (i) continuously evaluate the performance of your portfolio to
ensure the sub adviser selected adheres to your asset allocation guidelines; (ii) make recommendations
regarding the sub adviser as market factors and your personal goals dictate, (iii) assume discretionary
authority to hire or fire the sub adviser where such action is deemed to be in your best interest.
Important Information about Affiliated Sub-Advisers.
The XP Investment Management service makes available to clients investment services that are offered
by and XP Advisory Gestão de Recursos Ltda, affiliates of XP Advisory. XP Advisory has a potential
conflict of interest to the extent XP Advisory would advise a client to select investment services offered
by those affiliates of XP Advisory. For more information, see Item 10 - Other Financial Industry Affiliations
and Activities.
Non-wrap Investment Management Services
XP Advisory offers investment management services where clients receive ongoing investment advice,
but separately pays for securities transactions and brokerage-related fees. At the client’s direction, XP
Advisory will manage the account according to a specific strategy on a discretionary basis. The
investment management service could include affiliated or unaffiliated third-party investment managers.
XP Advisory provides additional consulting services to the client in accordance with their particular needs
or objectives. This service is designed to accommodate a client who wishes to independently select
investment services outside of XP Advisory US Wrap Fee Program in managing the assets in the client’s
account.
In some cases, a client may direct XP Advisory to
use a particular broker-dealer for execution of the
client’s trade orders (a “directed brokerage arrangement”). This occurs when a client’s account is held at
another broker-dealer firm and the client directs XP Advisory execute trades through that firm.
Clients should be aware that any costs related to this arrangement are not included in the advisory fee
and that the client will be solely responsible for paying any commissions, markups or markdowns or other
costs imposed by the directed broker-dealer. Please see Item 12 – Brokerage Practices for further
information.
Selection of Third-Party Investment Advisors, Platforms and Programs
We have entered into agreements with various third-party investment advisers for the provision of certain
investment advisory services. Factors considered in the selection of a third-party advisor include but may
not be limited to: i) Our firm’s preference for a particular third-party advisor; ii) the client’s risk tolerance,
goals and objectives, as well as investment experience; and, iii) the amount of client assets available for
investment. In order to assist clients in the selection of a third-party advisor, we will typically gather
information from you about your financial situation and investment objectives.
The third-party advisor may customize your portfolio by blending traditional investment strategies with an
allocation to asset classes. Generally, securities transactions will be decided upon and executed by the
third-party advisor on a discretionary basis. This means that the manager selected will have the ability to
buy and sell securities in your account without obtaining your approval. We will not manage or obtain
discretionary authority over the assets in accounts participating in these programs; however, clients may
grant us the discretionary authority to hire and fire such third-party managers. Generally, clients may not
impose restrictions on investing in certain securities or types of securities in accounts managed by a
third-party advisor.
We will periodically review reports provided to you. We will contact you at least annually, or more often
to review your financial situation and objectives, communicate information to the third-party advisor
managing the account as necessary, and, to assist you in understanding and evaluating the services
provided by the third-party advisor. Please notify us of any changes in your financial situation, investment
objectives, or account restrictions.
A complete description of the services provided, the amount of total fees, the payment structure,
termination provisions and other aspects of the third-party advisor’s advisory business are detailed and
disclosed in: i) the third-party advisor’s Form ADV Part 2A; ii) the program wrap brochure (if applicable)
or other applicable disclosure documents; iii) the disclosure documents of the portfolio manager(s)
selected; or, iv) the third-party advisor’s account opening documents. A copy of all relevant disclosure
documents of the third-party advisor and of the individual portfolio manager(s) will be provided to anyone
interested in these programs/managers.
Investment Services to Pooled Investment Vehicles
XP Advisory also provides investment advisory services to domestic and offshore pooled investment
vehicles that are exempt from SEC registration (“Institutional Advisory Services”). XP Advisory’s
investment advisory related services to pooled investment vehicles are subject to the terms set forth in
their Private Placement Memorandum or Explanatory Memorandum. Please see further information
under Item 10 and 14 of this brochure.
Types of Investments
We offer our clients a world of options through an open architecture investment platform.
Equities and Options
Another core component to a well-diversified portfolio is global equity products. At XP Advisory, we
provide market access to a wide range of financial instruments, such as listed U.S. and International
stocks, ETFs, equity and index options and ADRs.
Fixed Income
Fixed income products are an important component to a well-diversified portfolio. We develop many of
our strategies based on bond management techniques that focus on adding value while managing risks.
We offer a comprehensive range of fixed income products, including treasuries, government notes and
bonds, corporate bonds, emerging market bonds, international sovereign bonds, and agency bonds.
Mutual Funds
Another important option for well-structured portfolios is the addition of mutual funds and the inherent
diversification they provide. Through our open-architecture, we work with best-in-class fund managers
with long, successful track records and a thorough grounding in risk management. We specialize in
working with a comprehensive set of fund managers offering products with a unique set of benefits for
international investors.
Wrap Fee Program
XP Advisory is the portfolio manager and sponsor of the XP Advisory US Wrap Fee Program (“the
Program”). Our portfolio management services are offered through the Program for a single fee that
includes administrative fees, portfolio management fees, and commissions. The overall cost you will incur
if you participate in our wrap fee program may be higher or lower than you might incur by separately
purchasing the types of securities available in the program. In order to compare the cost of the Program
with unbundled services, the client should consider the turnover rate in our investment strategies, trading
activity in the account and standard advisory fees and brokerage commissions that would be charged at
other broker-dealers and investment advisors.
The Program began in 2020. Existing clients of our firm have been offered the option of transitioning to
a wrap account or maintaining their account under a non-wrap arrangement. Therefore, legacy clients of
XP Advisory could have non-wrap account arrangements. Under certain situations XP Advisory offers
other investment management account options as disclosed above. There are no differences in how we
manage wrap fee accounts and how we manage non-wrap accounts.
XP Advisory, as portfolio manager is responsible for the research, security selection and implementation
of transaction orders in the client's account. The transactions in the client's account will be executed by
XP Investments US, LLC (“XPI”), an affiliated and introducing broker-dealer. Client assets are custodied
at Pershing, LLC (“Pershing”). XP Advisory receives a portion of the Wrap Fee for portfolio management
services. XPI will receive a portion of the fee for trade execution expenses and Pershing will receive a
portion of the fee for its custodial services.
The terms and conditions under which a client participates in XP Advisory’s wrap fee program will be set
forth in a written agreement between the client and XP Advisory. For detailed information about the XP
Advisory US Wrap Fee Program, please see our wrap fee brochure (Part 2A Appendix 1 of Form ADV).
Regulatory Assets Under Management
As of December 31, 2023, we managed approximately $890,628,814 in client assets on a discretionary
basis and approximately $643,471,296 in client assets on a non-discretionary basis.