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Frequently Asked Questions

Getting Started

Investment Strategy

Account Operations & Reports

Insurance & Other Matters


Getting Started

What if I want to transfer my account from another investment firm?

Kagan Cocozza Asset Management will assist you with all paperwork necessary for a smooth transition and will act to minimize any fees your current broker / custodian charges that are associated with transitioning your portfolio.

What is the next step if I want to hire Kagan Cocozza Asset Management?

Contact us to set up an initial meeting to determine if Kagan Cocozza Asset Management is a good fit for your needs.

Investment Strategy

Am I involved in the day-to-day management decisions?

Kagan Cocozza Asset Management generally has discretion over all accounts and manages portfolios day-to-day. Each portfolio follows a highly customized and risk managed strategy that is decided in advance and outlined in a written Investment Policy Statement.
If a client wishes to make changes to their investment structure KCAM will consult with you and work with you to write an updated Investment Policy Statement.

How will I know a trade has occurred in my account?

TD Ameritrade Instituional (the custodian where your assets are held) will notify you by mail or email each time KCAM makes a trade for you. All trades are conducted in accordance with your written Investment Policy Statement.
You do not need to contact anyone when you see a trade has been made, although you are always free to contact us with any questions at any time.

Do investments differ from client to client?

Many investments are used in all portfolios although the percentage allocated to an asset class may differ depending on the needs of each client. In addition, taxes may affect which investments are selected for taxable accounts and which are selected for retirement accounts.

How do you select one fund over another?

KCAM is strong advocate of disintermediation. Disintermediation is a fancy way of saying that there are too many levels of fees charged to retail clients in the investment world and we do our best to get rid of all middlemen and unnecessary fees.
For this reason, we utilize either a hybrid passive/active strategy utilizing index ETFs to obtain market exposure for our clients at minimal cost or we construct a conservative strategy of dividend paying high quality blue chip stocks.
We are able to further reduce risk in our client’s equity (stock) holdings by utilizing conservative techniques to dampen volatility. Please contact us for a more full discussion on how we achieve these objectives. Where we absolutely have no choice, we will utilize mutual fund managers selected on 10-year track records and cost. Areas where we have no choice but to use mutual funds include 529s and most 401(k)’s.

Do you publish the past performance of your strategies?

As fiduciaries, we adhere to the strictest performance reporting standards. Each client receives a personal quarterly performance report benchmarked to their investment policy. While we do calculate composite performance information on all portfolio strategies, we do not publish this data in the public domain because these composite results have not been verified by an independent third party.

Account Operations & Reports

Is TD Ameritrade Institutional the only custodian available to clients?

TD Ameritrade Institutional is the custodian and clearing firm that we have selected. They act as a custodian to most of our clients’ assets, which means they hold securities and cash and facilitate trading activities. KCAM has selected TD Ameritrade Institutional as custodian primarily due to their integrity as custodian and the safety of client assets. They also charge low trading costs and have a very robust technology platform. Our management fees are able to be reduced by using TD Ameritrade as a primary custodian.

Is Kagan Cocozza Asset Management affiliated with TD Ameritrade Institutional?

KCAM is not affiliated with TD Ameritrade Institutional or their parent company, nor are we compensated by TDAI through fees, commissions, or incentives. We are, however, supplied necessary software that allows us to manage portfolios efficiently. The same software is available to all investment advisors that custody at TDAI and is generally available to firms like ours from custodians across the industry.

Do I communicate with the Custodian?

No. There is no reason to visit a TDAI office or to open TD Ameritrade accounts yourself. You will be signing TDAI paperwork that we will send to you. All deposits are made by KCAM into your TDAI account.

Will I have Internet access to my account?

Yes. Free Internet access is available to clients through a special TDAI website which is accessible through KCAM’s website. The website also is the source for immediate information on account activity and provides you with many reports including year-end tax information.

How often do I receive statements and reports?

TDAI generates monthly account statements and sends those statements directly to all clients for all accounts. These statements show account balances, trades, cash flows, and unrealized gains. Statements are available in paper as well as through email. In addition, KCAM will send a detailed performance report each quarter that compares your portfolio’s performance to a series of relevant market indices.

Will I receive reports that will help with tax preparation?

Yes. At the end of each year, TDAI will send 1099s to each client that has a taxable account. In addition, a realized gain/loss statement is available on-line from TDAI.

Is there a cost to terminate the agreement if I am not satisfied with your services?

No, either party can terminate the Agreement at any time and for any reason, but there is a 30 day waiting period, if necessary, to allow trades to settle or illiquid investments to clear. There are no termination charges. A final invoice will be drafted based on the number of days during the current quarter that the account was under management.

Insurance & Other Matters

Does anyone at KCAM have access to my money?

No. Nobody at KCAM has access to the money in your account. We have limited power of attorney to do only three things in a client’s account: 1) trade securities with discretion and only in accordance with each client’s Investment Policy Statement; 2) request that TDAI send a check to a client directly or to a client’s bank account; and 3) be paid a quarterly management fee from the account based on the contract rate. We have no other access to your assets or authority to distribute them.

Are my accounts insured from theft, fraud, errors, omissions and insolvency?

All accounts are insured on multiple levels. TDAI insurance coverage is extensive and is explained in a public brochure that is available to all investors. KCAM also carries Errors and Omissions insurance.

How is my privacy protected?

Each year our clients receive a Privacy Statement that outlines this responsibility in detail. KCAM will not release any information to any person who is not directly named on your account unless we have your permission to do so, with the exception of legal and regulatory authorities.

What does it mean to be a Registered Investment Advisor (RIA)?

KCAM is a Registered Investment Advisor (RIA). All professional investment management companies are required to register with the U.S. Securities and Exchange Commission (SEC) and/or the State(s) in which the firm conducts business activities. That registration is called an ADV, and it is available in two parts. ADV Part I is basic information about the advisory business and ADV Part II explains our services and fees. Each of these documents is available upon request.

How does an RIA differ from a brokerage firm?

RIAs are in the investment management business and we are regulated by the Investment Advisors Act of 1940. In contrast, brokerage firms are primarily in the financial product sales and distribution business and they are regulated by the Securities Act of 1933 as well as other laws. As an RIA under the 1940 Act, we have a higher level of fiduciary responsibility than brokerage firms. We are required by law to work in our clients’ best interest. Our fee is based on assets under management (AUM) rather than the brokerage model that is tied to the sale and distribution of financial products generally for commissions.

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