SEC Guidelines 2017-03-26T19:47:49+00:00

SEC Guidelines

Finding the right financial planner can be a confusing process. To simplify the search, the SEC has published their Investor Bulletin: Top Tips for Selecting a Financial Professional. This publication contains the following 5 tips for finding a financial advisor:

  • Tip 1: Do your homework and ask questions.
  • Tip 2: Find out whether the products and services available are right for you.
  • Tip 3: Understand how you’ll pay for services and products, and how your financial professional gets paid as well.
  • Tip 4: Ask about the financial professional’s experience and credentials.
  • Tip 5: Ask the financial professional if he or she has had a disciplinary history with a government regulator or had customer complaints.

Additionally, the bulletin contains a checklist of questions for investors to ask a financial professional whose services under consideration. These questions cover three areas: expectations from the relationships; the planner’s experience and background; and products.

Below is a list of each of the questions, along with Apex’s response to each.

Expectations of the Relationship

How often should I expect to hear from you?

Because financial planning in an ongoing process, we communicate with clients on a regular basis to discuss cash flow needs, tax projections, investment performance as well as any personal or professional updates. Annual reviews include a complete set of personal financial statements.

How often will you review my account?

We review our investment portfolios weekly and continuously refine and adjust, taking many factors into consideration such as market conditions, asset allocation, risk exposure and gains/losses to name a few. All accounts are managed on a discretionary basis.

If my investments aren’t doing well, will you call me and recommend something else?

There are many benefits to managing investments in-house as Apex does: flexibility of proactive investment management and reduced management costs are the two major benefits. Because we do not hire outside money managers, we are able to adjust specific investments as well as asset allocation as often as needed. Keep in mind that Apex is a fiduciary and required by the SEC to act in clients’ best interests. We are compensated on a percentage basis of assets and receive no commissions for trades.

If I invest with you, how can I keep track of how well my investments are doing?

You will receive monthly statements from our custodians. You also have on-line access to your accounts through the custodian’s website, as well performance tracking available through a third-party data service provided by Apex.

Experience and Background

What education have you had that relates to your work? What professional licenses do you hold?

Robert Connell holds a Bachelor of Science degree from Pennsylvania State University and completed two additional years of advanced studies and research for NASA. Mr. Connell earned his CERTIFIED FINANCIAL PLANNER(TM) designation in May of 1978 and was one of the first 500 in the country to achieve said designation.

Are you registered with the SEC, a state securities regulator, or FINRA?

As a Registered Investment Advisor, Apex Financial Advisors is registered with the SEC. As an Investment Advisor Representative, Robert Connell is registered with individual states in which Apex conducts business.

As a Commodity Trading Advisor, Apex is registered with the Commodity Futures Trading Commission and is a member of the National Futures Association. Robert Connell and Stuart Caplan are principals on trading decisions.

How long have you done this type of work?

Robert Connell has over 35 years experience in the financial advisory field. Mr. Connell founded Apex Financial Advisors in August 2010. Prior to Apex, Mr. Connell was a Branch Manager and Senior Vice President/Financial Advisor with Morgan Stanley Smith Barney, LLC and its predecessors, and a Senior Vice President and Financial Advisor with Merrill Lynch.

Have you ever been disciplined by a regulator? If yes, what was the problem and how was it resolved?

Have you had customer complaints? If yes, how many, what were they about, and how were they resolved?


What type of products do you offer? How many different products do you offer? Do you offer “house” products? If so, what types of products are they, and do you receive any incentives for selling these products, or for maintaining them in a customer’s account? What kind of incentives are they?

A major benefit of being an independent advisor and having no affiliation with a bank or broker/dealer is the fact that Apex has no house products.

Apex is a fiduciary and therefore required by the SEC to act in clients’ best interests. We are compensated on a percentage basis of assets and receive no commissions on investment products or trades.

For example, Apex utilizes the lowest cost institutional shares that have no 12b1 fees, whereas broker/dealers typically use A-shares which have front-end load expenses or C-shares which often have contingent deferred sales charges of 1% or more in additional to an additional management fee expense of 1%.

Payments and Fees

Given my situation and what I’m looking for, what is the [best / most cost effective] way for me to pay for financial services? Why?

We believe fee only is the best and most cost-effective method, as it offers transparency and aligns clients’ interests with our own.

What are the fees that I will pay for products and services?

Apex receives no fees or commissions for investment services other than our agreed upon asset management percentage fees.

The management fee paid to Apex is for the comprehensive financial planning services provided by the professionals at Apex and is a percentage of your assets under management. This management fee includes all aspects of the financial planning process: investment management, tax planning, retirement planning and estate planning.

The low cost commission charges are paid to third-party custodians who hold client assets and execute trades. These transactions incur dramatically reduced fees or no cost.

Apex receives no commissions or other compensation on investment assets from outside sources, so there are no conflicts of interest or financial incentives for Apex to utilize one product over another.

How and when will I see the fees I pay?

Our account management fees are discussed in the initial meeting with clients. These fees are listed and accepted in writing by clients in our Client Agreement. These account management fees are deducted from your investment account on a regular basis, depending on the investment).

Which of those fees will I pay directly (such as a commission on a stock trade) and which are taken directly from the products I own (such as some mutual fund expenses)?

Apex utilizes third-party custodians to hold all assets. Apex has negotiated reduced commissions for clients through these custodians; these commissions are paid by clients directly from their investment accounts. As we receive no part of any commissions, we always negotiate to the smallest charges.

If I invested $1,000 with you today, approximately how much would you get paid during the following year, based on my investment?

Investment management fees range from 0.20% to 1.50% depending on the asset class and total assets under management. This would equate to anywhere from $2 to $15.

How do you get paid? Does someone else (such as a fund company) pay you for offering or selling these products or services?

Apex receives no compensation from outside sources or fund companies. We are compensated for our services on a percentage basis of assets and receive no commissions on investment products or trades from fund companies, so there are no conflicts of interest or financial incentives for Apex to utilize one product over another.