Popular Securities, LLC (hereinafter “Popular Securities” or “firm” or “we”) is an SEC-registered
investment adviser with its principal place of business located in Hato Rey, Puerto Rico. Popular
Securities began conducting investment advisory business in 2001. Popular Securities is also a
registered securities broker-dealer and a member of the Financial Industry Regulatory Authority
(FINRA), and the Securities Investor Protection Corporation (SIPC) that has been in business since
1997.
Popular, Inc., a financial holding company, is the sole owner of Popular Securities. Popular, Inc. is
a public company with no shareholders owning 25% or more of its shares.
We offer investment advisory services to clients through Fidelity Managed Account Xchange
Program or (“FMAX Program”) sponsored by Fidelity Institutional Wealth Adviser LLC or
(“FIWA”), a third-party Registered Investment Advisor. Custody, clearing and other services are
provided by National Financial Services LLC or (“NFS”). FIWA is not a corporate affiliate of
Popular Securities or NFS. NFS does not provide investment advisory services of any kind in
connection with the FMAX Program. The FMAX Program platform utilizes services provided by
Envestnet, who operates the technology platform on which FMAX Program functions and
renders investment advice to Popular Securities and clients, including recommending an
appropriate asset allocation and specific investment managers or investment products with
respect to those assets invested in the FMAX Program (the “Program Assets”).
As part of Popular Securities investment management services, we will discuss with you your
financial situation and offer suggestions for one or more asset allocation portfolios consistent
with your investment objectives and risk tolerance. We will periodically, but no less than
annually, analyze your portfolio in light of your current financial situation and implement any
changes as authorized by you. You are responsible for promptly advising Popular Securities of
any significant changes in your financial or personal circumstances.
The Firm provides various investment advisory services to clients which include financial
planning, fund strategist portfolio, unified managed accounts, separately managed accounts, and
advisor directed models. Clients may invest in one or more of the programs available through
the FMAX Program. FIWA sponsors the platform used for the FMAX Program and the Firm is the
FMAX program sponsor and investment managers available on the platform manage their
respective model portfolios.
Mutual Fund and ETF Asset Allocation Program
Allows Popular Securities to create models by selecting from a variety of mutual funds and/or
exchange trades funds (“ETF”) on the FMAX Platform. With access to a universe of managed
models composed of funds, models can better align with client risk profiles and investment
objectives. Popular Securities designs the model portfolios including the target asset mix using
no-load funds or ETFs. The models follow a market-oriented investment philosophy with low
holdings turnover. Popular Securities receives historical market analysis, risk/return analysis,
research, and continuing education from the providers of the mutual funds and ETFs in the
program.
The Separately Managed Account Program (“SMA”)
Provides investors access within multiple accounts to individual stocks or bonds through
professionally managed portfolios and allows advisors to combine SMAs with mutual funds
and/or exchange traded funds. Assets invested in separate accounts are managed by investment
advisers as sub-managers pursuant to entered agreements.
The Unified Managed Account Program (“UMA”)
Provides investors access within a single account to multiple investment products including
mutual funds, exchange traded funds, other securities, funds strategist programs, and separate
managed accounts. Assets invested in a single account for a customized portfolio corresponding
to clients’ needs. Popular Securities is responsible for selecting the specific, underlying
investment vehicles in the appropriate model to meet your needs. In certain instances, Popular
Securities may determine the target asset mix in addition to selecting the underlying investment
vehicles.
Advisor Directed Model
This model allows for assets to be invested in mutual funds, ETFs and/or other securities and
investments to be managed by Popular Securities. Specific investment choices and asset
allocation will be selected by Popular Securities, who will have full discretionary authority over
these types of account granted by the Terms and Conditions agreed upon with the clients.
Reporting Only Services
Clients have the ability to allow Popular Securities to designate certain holdings as reporting
only, meaning they are held within an FMAX account but are not managed or overseen through
the FMAX Program. Popular Securities will be responsible for monitoring and managing the
designated holdings as reporting only. Popular Securities will be responsible for any fee
calculation and billing administration on the reporting only assets.
Non-FMAX Program Services
Popular Securities also offers investment management services through certain fixed income
money managers (“Fixed Income Managers”) outside of the FMAX Program. The Fixed Income
Program, held outside of the FMAX Program, will require the client to enter into a separate
agreement with the Fixed Income Manager containing separate terms and conditions and
important disclosures. A copy of the Fixed Income Manager’s Disclosure statement will be
provided.
If the client enters into an advisory agreement with a Fixed Income manager, the client
will be appoint the Fixed Income Manager as their investment adviser and will be granting full
authority to invest, reinvest and otherwise deal with the assets invested under the Fixed Income
Program, including without limitation the authority to select, allocate and reallocate the assets
under the Fixed Income Program to different Sub-Managers and to delegate such investment
discretion to such Sub-Managers. Such discretionary authority allows the Fixed Income Manager
to make all investment decisions with respect to the assets invested under the Fixed Income
Program and when it deems appropriate and without prior consultation with you, to buy, sell,
exchange, convert and otherwise trade in any bonds, mutual funds, and other securities. In
selecting investment vehicles and Sub-Managers for the assets invested under the Fixed Income
Program, the Fixed Income Manager will consider factors it deems relevant, including but not
limited to, your investment goals and objectives, and any reasonable restrictions imposed by you
on the management of such assets, including the designation of particular securities or types of
securities that should not be purchased for your accounts, or that should be sold if held in such
accounts. You should understand and be willing and able to accept the risk involved in the
selection of investments before entering into an advisory agreement. There is no assurance that
your investment objective will be achieved.
Financial Planning Services
Popular offers financial planning services to its advisory clients. For such clients, a financial
planning report is created to assist advisory clients in the area of personal financial planning, and
can cover or analyze various topics, including, but not limited to, net worth, budgeting and cash
flow, retirement planning, asset allocation, college financial planning, and disability planning.
Wrap Fee Programs
A wrap-fee program is a type of investment program that provides clients with access to several
money managers or mutual fund asset allocation models for a single fee that includes
administrative fees, management fees, and commissions. If you participate in this program, we
will provide you with a copy of FIWA’s disclosure document. You will also be provided with
separate disclosure documents for each independent Sub-Manager managing a separate
account for you. In addition, if the investment program recommended to you is a wrap fee
program, you will also receive the Appendix 1 or equivalent wrap fee brochure provided by the
sponsor of the program. If you participate in a wrap fee program, you will pay a single fee, which
includes our money management fees, certain transaction costs, and custodial and
administrative costs. We would receive a portion of the wrap fee for our services. The overall
cost you will incur if you participate in a wrap fee program may be higher or lower than those
that you might incur by separately purchasing the types of securities available in the wrap fee
program. You are encouraged to review all disclosure document(s) to learn more about the
particular characteristics of each of the services offered within the wrap fee program.
Types of Investments
We primarily offer advice on various types of securities, including, but not limited to, equity
securities, corporate debt securities, municipal securities, mutual fund shares and ETFs. ETFs and
mutual funds may be invested in real estate, oil and gas.
Additionally, we may advise you on other types of investments that we deem appropriate based
on your stated goals and objectives. We may also provide advice on other types of investments
held in your portfolio at the inception of our advisory relationship.
You may request that we, FIWA, the Fixed income Manager and/or Sub-managers refrain from
investing in particular securities or certain types of securities. You must provide these
restrictions in writing. We will employ our reasonable best efforts to accommodate your request.
Assets Under Management
As of December 31, 2023, we provide continuous management services for $2,228,633,352 in
client regulatory assets. The Firm also provides services to $63,755,213 in client non-regulatory
assets, for which Popular Securities provides limited investment advice.
Other Investment Advisory Services
We provide co-asset management services to the Popular Mezzanine Fund, LLC (the “Mezzanine
Fund”) a private equity fund organized as a limited liability company under the laws of the
Commonwealth of Puerto Rico that is designed to provide customized financing solutions to
privately held companies organized or engaged in a trade or business in Puerto Rico that meet
the requirements of the Community Reinvestment Act. Our services to the Mezzanine Fund
generally consist of the following: (i) determining the composition of the Mezzanine Fund’s
investment portfolio (ii) identifying, evaluating and negotiating the structure of such
investments; and (iii) recommending changes to the securities and other assets that may be
acquired by the Mezzanine Fund from time to time. The Mezzanine Fund is a subsidiary of our
affiliate Banco Popular de Puerto Rico. The other co-asset manager of the Mezzanine Fund is
Enhanced Puerto Rico LLC a wholly owned company of Enhanced Asset Management. Enhanced
Asset Management is a subsidiary of Enhanced Capital Group.
We also provide limited advisory services to retirement plans and/or personal trust accounts
held outside the firm and/or held at our affiliate, Banco Popular of Puerto Rico.