Automatic Billing Methods and Examples

Percent of Net Liquidation Value

Description: Percentage of Net Liquidation Value entered as an annualized percentage, applied on a daily basis (252 business days are applied in this calculation method).

Assumption: You specify 5% of Net Liquidation Value as an annualized percentage, and your client’s previous day ending-equity is $100,000.

Calculation: Your advisor client fees for the given day will be: 5%*$100,000/252=$19.84.

Flat Fee

Description: Flat fee entered as an annualized amount, applied on a daily basis (apportioned by 252 days).

Assumption: You specify $1,000 as an annual flat fee for your client.

Calculation: Your advisor client fees daily payment will be: $1,000/252=$3.97.

Percent of Annual P+L

Description: Percentage of Annual Positive P+L entered as an annualized percentage, applied on an annually basis as of 12/31.

Assumption: You specify 20% of annual positive P+L as your advisor client fees, and you made $50,000 in P+L for your client for that year.

Calculation: Your advisor client fees would be: $50,000*20%=$10,000.

Percent of Market-to-Market P+L

Description: Percentage of Positive Market-to-Market P&L entered as a percentage, applied on a quarterly basis as of 3/31, 6/30, 9/30, and 12/31.

Assumption: As an example, if you specify 2% of Market-to-Market P+L, you made $50,000 in P+L for the last quarter.

Calculation: Your client will be charged $50,000*2%=$1,000 for the quarter.

The risk of loss in online trading of stocks, options, futures, currencies, foreign equities, and fixed income can be substantial. Options are not suitable for all investors. For more information, read the "Characteristics and Risks of Standardized Options".

Your capital is at risk and your losses may exceed the value of your original investment.

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