Anybody work at JP Morgan? What’s the lowest fee you charge for a managed account, say 500k? Client telling me 45 basis point. Hmmm. I had wife’s account and now needs to combine to reach the 500k to reach threshold.

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How do they even compete with such extortionate fees? Doesn't everyone just no fee platforms these days?

likefunny

No I work for JPM, $500k is a 1.15% management fee, not including internal expenses like SMA’s or managed account expense ratios. They can try to negotiate the fee, I don’t allow it, but some of my colleagues do.

In an IRA, if you use JPM funds, you receive a refund for the expense ratios and internal management fees.

But nobody is charging 0.45%, unless you are a part of the private bank, maybe. That’s a $10M net worth minimum…

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Why do you need them to actively manage it for you? Why not Vanguard and chill?

funnylike

Not me, for a client that moved there with her husband

For SMAs? .45 sounds right.

likehelpful

Really? Ughhh

How much of this is negotiable / in your control? (Just curious from an outsiders perspective)

like

That's insane

helpful

I keep thinking no way!

Is your client ultra conservative? I work at JPM and we charge 0.70% on bond ladders. On $500k+ advisors tend to discount the fee down to 0.50% so that’s maybe what he’s talking about…

helpful

How does advisor get paid?

35% revenue share, so if the client pays 0.50% the advisor gets 0.175%

helpful

It dies nit make sense. I’m going down to .95% but those are accounts over 1mm

The race to zero is on.

like

Good grief. How are we to make money?

Just to to clarify. The 0.50% is a discounted fee on a muni/treasury/corporate bond ladder. Far from a core portfolio and designed as a satellite allocation.

smart

Then probably 1.00% - 1.15% at $500k.

SMA can go .4 if passive strategy or .62 for active strategy

Was the .45 for internal expenses only and then an advisor/management fee on top? Seems very low for an advisory account of that size. If I were you I’d check their statements and look at the total fees charged over a year, do the math.

When I was at JPMS there is no way I’d charge that low for a $500k account.

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