Frequently Asked Questions

Can you offer what the large financial planning and investment management firms offer?

We can do most of the things that they do, and handle the needs of middle and upper income families just fine. We prefer to keep our operation small, with a limited number of customer clients. This way we can give more attention to each. Also, we try to make the most of technology. We use the internet a lot, and have direct communications links to Schwab Institutional. We like to meet with customers in their offices, or in their homes, or at a coffee shop. Most of our clients are users of the internet too, and we communicate by Email and FAX. We have contacts with attorneys, accountants, and insurers so that we can refer people when they need these other services.

On December 31, 2023, Piedmont Street Management had more than $30 million under investment management for 19 individual and family clients.

What do you charge?

Please read our Brochure - Piedmont Street Management 2024.

Here are some examples of projects we have done:

• A client's aging mother turned up a shoebox full of old mutual fund statements. We helped her determine how many funds were still in business and the current value of her holdings.
• A client was in a divorce and asked that we review plans for splitting the family assets.
• A client had a number of scattered investments, and wanted an integrated plan for investment management.

For investment management, Piedmont Street Management charges 3/4% per annum on assets under management at Charles Schwab & Co., Inc. or other similar custodian. Fees are prorated for each quarter and are deducted from account balances at quarter end. Three quarters percent per annum works out to .0019 per calendar quarter.

Will you try to sell me mutual funds, or insurance?

We are independent, and do not work for any insurance company, broker, or mutual fund company. In this way we try to give impartial, objective advice to you. However, we do use Charles Schwab & Co, Inc. as custodian for securities accounts of our clients. Schwab charges discount commissions, and we do not share in them.

If we decide together that you need mutual funds, bonds, or securities as part of a proper, diversified investment portfolio, then we will recommend them. Similarly, if we learn that you are underinsured in one or more areas such as auto, life, or disability, we may recommend that you see an insurance agent. If we think you need a family trust or will as part of estate planning, we may recommend you to an attorney.

Are you a stockbroker?

No, although we can do many of the things that a stockbroker does. If you engage us as your Investment Manager, then we can enter trades at Schwab Institutional for you. Each trade must be approved in advance by you. What can't we do? Well, we do not have access to hot IPO's for one thing.

How does Charles Schwab & Co. fit in?

Piedmont Street Management is one of Schwab's 5,000 or so independent investment managers. Our investment management clients have their securities accounts at the Schwab Institutional division of Charles Schwab & Co. Our computer is linked to Schwab Institutional and so we can track customer securities portfolios and enter needed trades. Schwab charges commissions at discount levels. We do not participate in those commissions. Why did we choose Schwab? We know they are very large, well capitalized, make good use of technology, and we can be confident that they will do a good job for our clients.

Can you guarantee a certain return on my securities portfolio?

Only if we agree that the whole thing will be invested in US Treasury bonds, but we seldom recommend that. The process of investment management begins with knowing each other, and assessing how much risk you as client want to take, and should be taking. Young people often are in position to take more risk, and so often we agree on some high technology stock investments. Older people may be retired, and so conservative bonds are needed. But there are no guarantees for these investments. The point is we work to put each investor into the investments that are correct for their situation and risk tolerance. What happens thereafter depends upon the movements of securities markets, and the quality of the company securities purchased.

If I have an account, where will my securities be held?

Piedmont Street Management uses Charles Schwab & Co. as custodian. Schwab will hold your accounts, your securities will be with Schwab, you will receive monthly statements from Schwab, and if you pay money into your account you will make the check payable to Charles Schwab & Co. If you want money out of your account the request must go to Schwab who will send you a check. If you want to track your securities yourself, you will be able to do so through www.Schwab.com or www.SchwabAlliance.com.

How will I know what you are doing with my investments?

First, we start out with a detailed written investment plan that we both agree on. Then as we implement that plan, you as client must approve each investment decision. Typically we will provide an investment analysis report on a company, discuss it with you, explain how this investment would fit with the investment plan, and answer any questions. If you agree, then we go ahead with the investment. Each time a trade is done, Charles Schwab will mail you a confirmation of trade form. Clients can also track their portfolios through www.Schwab.com. At the end of the month, Schwab mails out regular account statements. After each quarter end, we try to meet with each client to review investments and make plans for the coming quarter's investment decisions.

Do you give tax advice?

Yes and no. We are not Enrolled Agents and so cannot give technical advice. We do not prepare tax returns for clients. However, tax is one of the subjects that a financial planner is supposed to know. Yes, we do know something about taxes, and if we see an apparent way to improve your tax situation we will say so. For example, if you are not using IRA accounts then we can point out to you the tax savings you are foregoing. Or if you want to sell your home, we can review together the capital gains exclusion on sale of personal residence.

Does Piedmont Street Management do Financial Planning?

No. We do investment management and that is certainly a big part of financial planning. If we see a clear cut issue in a related area of tax, or real estate, or other, we may bring that to a client’s attention. If a client has a question and we know the answer, then we will respond. But Piedmont Street Management does not offer full financial planning.

How Will I Know if My Investments are Really There?

All client securities, mutual funds, and cash are kept in accounts in clients’ names at Charles Schwab & Co. Clients receive monthly statements to their home address from Schwab. Clients also receive quarterly investment reports from Piedmont Street Management. Clients can compare and see that the securities and cash reported by Schwab exactly match the same information reported by Piedmont Street Management.