The full name of the service I use primarily is Loring Ward Adviser Services. “What do they do?” “How are they paid?”
Loring Ward Adviser Services functions primarily, and foremost, as my complete back office solution when it comes to administering client portfolios. Rather than increase my fees to clients to my own separate support staff at my office (and reinvent the wheel), the Staffing at Loring Ward serves that function for me and my clients. Who actually processes client requests, etc? That would be my back office support staff in San Jose.
Loring Ward is compensated for their client and adviser services through either 1) an administrative fee added to their portfolio, or 2) through the operating expenses of SA Funds (the most common method for most of my clients). SA Funds are not meant to be stand alone funds, rather mutual funds that work in tandem for diversification purposes. SA Funds are guided through an investment committee, with sub-management provided by Dimensional Fund Advisers (DFA) who are a well-respected institutional style management firm that makes their decisions based on applied academic research.
So let’s think Madoff for a moment… all of the above functions were missing because he did them himself or in-house. You need independent firms performing key functions so that cross-checks are in place to protect your assets from malfeasance. Thus, the support staff function at Loring Ward frees up my time from administration duties, so that the adviser function I do, is separate from your investment in SA Funds, which are managed by the investment committee and DFA, and held at a custodian. Each piece is vital.
These are key components you should be looking for with any adviser you work with:
- The adviser’s background, qualifications, ethics, core competencies, etc
- Staffing to properly manage administration of your investments (in my case Loring Ward Adviser Services),
- Investment Philosophy (in my case DFA’s Philosophy sums it up the best) (i.e., philosophy of both the adviser and of the firm implementing that philosophy – do they match?),
- Investment Philosophy application … are they consistent? (In my case SA Funds, or DFA funds in certain situations), and finally,
- Custodian who hold your investments (in my case primarily TD Ameritrade Institutional)… are they independent and separate from all the other functions?.
Disclosure: I am not compensated by sales commissions. Rather, compensation comes from the client through their fee assessed per their client agreement. Those fees come from their holdings which are at the particular custodian the client and I are using. I do utilize SA Funds for myself and clients. This is not a solicitation for SA Funds which are not available to retail clients; they are only available through registered investment advisers.