Fierston Financial Group, Inc. (“FFG”) is a Connecticut corporation formed on January 9,
1989 and registered as an investment adviser with the SEC in 1989. Seth B. Fierston and
Brian S. Fierston are FFG’s principal owners.
FFG provides its investment services based on the clients' individual goals and
circumstances. FFG manages client portfolios consisting primarily of no load (or load
waived) mutual funds, including mutual funds covering fixed income asset classes.
As of December 31, 2023, FFG had $ 835,866,547 in regulatory assets under management on
a discretionary basis.
PORTFOLIO MANAGEMENT SERVICES
Before engaging FFG to provide investment advisory services, new clients will be required
to enter into an Investment Advisory Agreement with FFG setting forth the terms and
conditions of the engagement (including termination), describing the scope of the services
to be provided, and the fee that is due from the client.
FFG provides continuous advice to a client regarding the investment of client funds based on
the individual needs of the client. Through personal discussions in which goals and
objectives based on a client's particular circumstances are established, FFG develops a
client's investment profile and creates and manages a portfolio based on that profile. Clients
may, at any time, impose reasonable restrictions in writing upon FFG’s advisory services.
FFG will manage advisory accounts on a discretionary basis. Account supervision is guided
by the stated objectives of the client (i.e., conservative, balanced, or aggressive).
FFG will typically create a portfolio consisting primarily of no-load (or load waived) mutual
funds. In limited circumstances, FFG’s client portfolios may also contain other securities,
including but not limited to, exchange traded funds (“ETFs”), individual exchange-traded
equity securities (stocks), fixed income securities, U.S. government bonds, agency bonds,
municipal securities, certificates of deposit and cash or cash equivalents. FFG will allocate
the client's assets among various investments taking into consideration the overall
management style selected by the client. The mutual funds will be selected based on any or
all of the following criteria: the fund's performance history; the asset class in which the fund
invests; the track record of the fund's manager; the fund's investment objectives; the fund's
management style and philosophy; and the fund's management fee structure.
As more fully detailed in Item 8 below, portfolio weighting between funds and market
sectors will be determined by each client's individual needs and circumstances. Clients will
have the opportunity to place reasonable restrictions on the types of investments that will
be made on the client's behalf. Clients will retain individual ownership of all securities.
As part of the portfolio management process, or upon specific client request, FFG may
provide general financial planning and consulting services without additional charge. While
FFG believes that it is important for the client to address financial planning issues on an
ongoing basis, FFG’s investment management fee will remain the same regardless of whether
the client addresses those issues with FFG. If FFG determines in its sole discretion that the
client seeks extraordinary planning and/or consultation services FFG may offer to charge for
such additional services under a separate, stand-alone Financial Planning and Consulting
Agreement as described below.
FINANCIAL PLANNING AND CONSULTING SERVICES (STAND-ALONE)
To the extent requested by a client, FFG may agree to provide financial planning or consulting
services (including investment and non-investment related matters, including estate
planning, insurance planning, etc.) on a stand-alone separate fee basis. Before engaging FFG
to provide stand-alone planning or consulting services, clients are required to enter into a
Financial Planning and Consulting Agreement with FFG setting forth the terms and
conditions of the engagement (including termination), describing the scope of the services
to be provided, and the portion of the fee that is due from the client before FFG commences
services.
MISCELLANEOUS
Limitations of Financial Planning and Non-Investment Consulting/Implementation Services.
FFG does not serve as an attorney, accountant, or insurance agency, and no portion of its
services should be construed as legal advice, accounting advice, or insurance
implementation services. Accordingly, FFG does not prepare estate planning documents, tax
returns, nor does it offer or sell insurance products. Unless specifically agreed in writing,
neither FFG nor its representatives are responsible to implement any financial plans or
financial planning advice, provide ongoing financial planning services, or provide ongoing
monitoring of financial plans or financial planning advice. The client is solely responsible to
revisit the financial plan or financial planning advice with FFG, if desired. The client retains
absolute discretion over all financial planning and related implementation decisions, and is
free to accept or reject any recommendation from FFG and its representatives. FFG’s
financial planning and consulting services are completed upon communicating its
recommendations to the client. To the extent requested by a client, FFG may recommend the
services of other professionals for certain non-investment implementation purposes (i.e.
attorneys, accountants, insurance agents, etc.). The client retains absolute discretion over all
such implementation decisions and is free to accept or reject any recommendation from FFG
and/or its representatives. Clients are under no obligation to engage the services of any
recommended professional, who shall be solely responsible for the quality and competency
of the services they provide. If the client engages any unaffiliated recommended
professional, and a dispute arises related to the engagement, the client should seek recourse
exclusively from and against the engaged professional. The preceding sentence shall not
limit or waive any applicable rights under federal or state law, including securities laws and
fiduciary obligations that cannot be limited or waived.
Retirement Plan Rollovers. A client or prospective client leaving an employer typically has
four options regarding an existing retirement plan (and may engage in a combination of
these options): (i) leave the money in the former employer’s plan, if permitted, (ii) roll over
the assets to the new employer’s plan, if one is available and rollovers are permitted, (iii) roll
over to an Individual Retirement Account (“IRA”), or (iv) cash out the account value (which
could, depending upon the client’s age, result in adverse tax consequences). If FFG
recommends that a client roll over their retirement plan assets into an account to be
managed by FFG, such a recommendation creates a conflict of interest if FFG earns a new (or
will increase its current) advisory fee as a result of the rollover. If FFG provides a
recommendation as to whether a client should engage in a rollover or not (whether it is from
an employer’s plan or an existing IRA), FFG is acting as a fiduciary within the meaning of Title
I of the Employee Retirement Income Security Act and/or the Internal Revenue Code, as
applicable, which are laws governing retirement accounts. No client is under any obligation
to rollover retirement plan assets to an account managed by FFG, whether it is from an
employer’s plan or an existing IRA. FFG’S Chief Compliance Officer, Seth B. Fierston, remains
available to address any questions that a client or prospective client may have regarding the
conflict of interest presented by a rollover recommendation.
Availability of Mutual Funds and Exchange Traded Funds. While FFG may allocate
investment assets to mutual funds and ETFs that are not available directly to the public, FFG
may also allocate investment assets to publicly-available mutual funds and ETFs that the
client could purchase without engaging FFG as an investment adviser. However, if a client or
prospective client determines to purchase publicly-available mutual funds or ETFs without
engaging FFG as an investment adviser, the client or prospective client would not receive the
benefit of FFG’s initial and ongoing investment advisory services such as determining which
funds are most appropriate to the client's financial condition, the objectives for management
of that asset, and whether to trade or rebalance the funds on an ongoing basis. All fees
imposed by the respective mutual funds and ETFs are separate from, and in addition to, FFG’s
portfolio management fee as described at Item 5 below.
Investment Risk. Different types of investments involve varying degrees of risk, and it should
not be assumed that future performance of any specific investment or investment strategy
(including the investments and/or investment strategies recommended or undertaken by
FFG) will be profitable or equal any specific performance levels. Please refer to Item 8 for a
more detailed description.
Portfolio Trading Activity / Inactivity. As part of its investment advisory services, FFG will
review client portfolios on an ongoing basis to determine if any trades are necessary based
upon various factors, including but not limited to investment performance, market
conditions, fund manager tenure, style drift, account additions/withdrawals, the client’s
financial circumstances, and changes in the client’s investment objectives. Based upon these
and other factors, there may be extended periods of time when FFG determines that trades
within a client’s portfolio are not prudent. Clients nonetheless remain subject to the fees
described in Item 5 during periods of portfolio trading inactivity. Of course, as indicated
below, there can be no assurance that investment decisions made by FFG will be profitable
or equal any specific performance level(s).
Cybersecurity Risk. The information technology systems and networks that FFG and its
third-party service providers use to provide services to FFG’s clients employ various
controls, which are designed to prevent cybersecurity incidents stemming from intentional
or unintentional actions that could cause significant interruptions in FFG’s operations and
result in the unauthorized acquisition or use of clients’ confidential or non-public personal
information. Clients and FFG are nonetheless subject to the risk of cybersecurity incidents
that could ultimately cause them to incur losses, including for example: financial losses, cost
and reputational damage to respond to regulatory obligations, other costs associated with
corrective measures, and loss from damage or interruption to systems. Although FFG has
established its processes to reduce the risk of cybersecurity incidents, there is no guarantee
that these efforts will always be successful, especially considering that FFG does not directly
control the cybersecurity measures and policies employed by third-party service providers.
Clients could incur similar adverse consequences resulting from cybersecurity incidents that
more directly affect issuers of securities in which those clients invest, broker-dealers,
qualified custodians, governmental and other regulatory authorities, exchange and other
financial market operators, or other financial institutions.
Aggregation
Platforms. FFG may provide its clients with access to aggregation services
available through various platforms (“Platforms”). Collectively, the Platforms allow a client
to view their complete asset allocation, including those assets that FFG does not manage (the
“Unmanaged Assets”). FFG does not provide investment management, monitoring, or
implementation services for the Unmanaged Assets. Therefore, FFG shall not be responsible
for the investment performance of the Unmanaged Assets. Rather, the client and/or their
advisor(s) that maintain management authority for the Unmanaged Assets, and not FFG,
shall be exclusively responsible for such investment performance. The client may choose to
engage FFG to manage some or all of the Unmanaged Assets under the terms and conditions
of an Investment Advisory Agreement between FFG and the client. The Platforms may also
provide access to other types of information and applications, including financial planning
concepts and functionality, which should not be construed as services, advice, or
recommendations provided by FFG. FFG shall not be held responsible for any adverse results
a client may experience if the client engages in financial planning or other functions available
on the Platforms without FFG’s assistance or oversight.
Trustee Directed Plans. FFG can be engaged to provide discretionary investment advisory
services to ERISA retirement plans, whereby the Firm shall manage Plan assets consistent
with the investment objective designated by the Plan trustees. In such engagements, FFG will
serve as an investment fiduciary as that term is defined under The Employee Retirement
Income Security Act of 1974 (“ERISA”). FFG will generally provide services on an “assets
under management” fee basis per the terms and conditions of an Investment Advisory
Agreement between the Plan and the Firm.
Fee Dispersion. FFG, in its discretion, may charge a lesser investment advisory fee, charge a
flat fee, waive its fee entirely, or charge fee on a different interval, based upon certain criteria
(i.e. anticipated future earning capacity, anticipated future additional assets, dollar amount
of assets to be managed, related accounts, account composition, complexity of the
engagement, anticipated services to be rendered, grandfathered fee schedules, employees
and family members, courtesy accounts, competition, negotiations with client, etc.). Please
Note: As result of the above, similarly situated clients could pay different fees. In addition,
similar advisory services may be available from other investment advisers for similar or
lower fees.
Custodian Charges-Additional Fees. As discussed below at Item 12 below, when requested
to recommend a broker-dealer/custodian for client accounts, FFG generally recommends
that Charles Schwab and Co, Inc. (“Schwab”) serves as the broker-dealer/custodian for client
investment management assets. Broker-dealers such as Schwab charge brokerage
commissions, transaction, and/or other type fees for effecting certain types of securities
transactions (i.e., including transaction fees for certain mutual funds, and mark-ups and
mark-downs charged for fixed income transactions, etc.). The types of securities for which
transaction fees, commissions, and/or other type fees (as well as the amount of those fees)
shall differ depending upon the broker-dealer/custodian (while certain custodians,
including Schwab, do not currently charge fees on individual equity or ETF transactions,
others do. Please Note: there can be no assurance that Schwab will not change its transaction
fee pricing in the future. Please Also Note: Schwab may also assess fees to clients who elect
to receive trade confirmations and account statements by regular mail rather than
electronically. These fees/charges are in addition to FFG’s investment advisory fee at Item 5
below. FFG does not receive any portion of these fees/charges.
Margin / Securities Based Loans. Upon client request, FFG may recommend that a client
establish a margin loan or a securities-based loan (collectively, “SBLs”) with the client’s
broker-dealer/custodian or their affiliated banks (each, an “SBL Lender”) to access cash flow.
Unlike a traditional real estate-backed loan, an SBL has the potential benefit of enabling
borrowers to access funds in a shorter time period, providing greater repayment flexibility,
and certain tax benefits. Clients interested in learning more about the potential tax benefits
of borrowing money on margin should consult with an accountant or tax advisor. The terms
and conditions of each SBL are contained in a separate agreement between the client and the
SBL Lender selected by the client, which terms and conditions may vary from client to client.
Borrowing funds on margin is not suitable for all clients and is subject to certain risks,
including but not limited to: increased market risk, increased risk of loss, especially in the
event of a significant downturn; liquidity risk; the potential obligation to post collateral or
repay the SBL if the SBL Lender determines that the value of collateralized securities is no
longer sufficient to support the value of the SBL; the risk that the SBL Lender may liquidate
the client’s securities to satisfy its demand for additional collateral or repayment / the risk
that the SBL Lender may terminate the SBL at any time. Before agreeing to participate in an
SBL program, clients should carefully review the applicable SBL agreement and all risk
disclosures provided by the SBL Lender including the initial margin and maintenance
requirements for the specific program in which the client enrolls, and the procedures for
issuing “margin calls” and liquidating securities and other assets in the client’s accounts.
If FFG recommends that a client apply for an SBL instead of selling securities that FFG
manages for a fee to meet liquidity needs, the recommendation presents an ongoing conflict
of interest because selling those securities (instead of leveraging those securities to access
an SBL) would reduce the amount of assets to which FFG’s investment advisory fee
percentage is applied, and thereby reduce the amount of investment advisory fees collected
by FFG. Likewise, the same ongoing conflict of interest is present if a client determines to
apply for an SBL on their own initiative. These ongoing conflicts of interest would persist as
long as FFG has an economic disincentive to recommend that the client terminate the use of
SBLs. Clients are therefore reminded that they are not under any obligation to employ the
use of SBLs, and are solely responsible for determining when to use, reduce, and terminate
the use of SBLs. Although FFG seeks to disclose all conflicts of interest related to its
recommended use of SBLs and related business practices, there may be other conflicts of
interest that are not identified above. Clients are therefore reminded to carefully review the
applicable SBL agreement and all risk disclosures provided by the SBL Lender as applicable,
and contact FFG’s Chief Compliance Officer with any questions regarding the use of SBLs.
FFG does not recommend such borrowing unless it is for specific short-term purposes (i.e. a
bridge loan to purchase a new residence). FFG does not recommend such borrowing for
investment purposes (i.e. to invest borrowed funds in the market). Regardless, if the client
was to determine to utilize margin or a pledged assets loan, the following economic benefits
would inure to FFG:
• by taking the loan rather than liquidating assets in the client’s account, FFG
continues to earn a fee on such Account assets; and,
• if the client invests any portion of the loan proceeds in an account to be managed by
FFG, FFG will receive an advisory fee on the invested amount; and,
• if FFG’s advisory fee is based upon the higher margined account value, FFG will earn
a correspondingly higher advisory fee. This could provide FFG with a disincentive to
encourage the client to discontinue the use of margin.
Please Note: The Client must accept the above risks and potential corresponding
consequences associated with the use of margin or a pledged assets loan.
Cash Sweep Accounts. Certain account custodians can require that cash proceeds from
account transactions or new deposits, be swept to and/or initially maintained in a specific
custodian designated sweep account. The yield on the sweep account will generally be lower
than those available for other money market accounts. When this occurs, to help mitigate the
corresponding yield dispersion, FFG shall generally (with exceptions) purchase a higher
yielding money market fund (or other type security) available on the custodian’s platform,
unless FFG reasonably anticipates that it will utilize the cash proceeds during a subsequent
period to purchase additional investments for the client’s account. Exceptions and/or
modifications can and will occur with respect to all or a portion of the cash balances for
various reasons, including, but not limited to the amount of dispersion between the sweep
account and a money market fund, the size of the cash balance, an indication from the client
of an imminent need for such cash, or the client has a demonstrated history of writing checks
from the account.
Please Note: The above does not apply to the cash component maintained within a FFG
actively managed investment strategy (the cash balances for which shall generally remain in
the custodian designated cash sweep account), an indication from the client of a need for
access to such cash, assets allocated to an unaffiliated investment manager, and cash
balances maintained for fee billing purposes. Please Also Note: The client shall remain
exclusively responsible for yield dispersion/cash balance decisions and corresponding
transactions for cash balances maintained in any FFG unmanaged accounts.
Client Obligations. In performing its services, FFG shall not be required to verify any
information received from the client or from the client’s other professionals, and is expressly
authorized to rely thereon. Clients remain responsible to promptly notify us if there is ever
any change in their financial situation or investment objectives for the purpose of reviewing,
evaluating, or revising our previous recommendations or services.
Please Note: Investment Risk. Different types of investments involve varying degrees of risk,
and it should not be assumed that future performance of any specific investment or
investment strategy (including the investments and/or investment strategies recommended
or undertaken by FFG) will be profitable or equal any specific performance level(s).
Disclosure Brochure. A copy of FFG’s written Brochure as set forth on Part 2 of Form ADV
and Client Relationship Summary as set forth in Form CRS shall be provided to each client
prior to, or contemporaneously with, the execution of the Investment Advisory Agreement
or Financial Planning and Consulting Agreement.
FFG shall provide investment advisory services specific to the needs of each client. Prior to
providing investment advisory services, an investment adviser representative will ascertain each
client’s investment objective(s). Thereafter, FFG shall allocate and/or recommend that the client
allocate investment assets consistent with the designated investment objective(s). FFG does not
participate in a wrap program.