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Fayez Sarofim Review

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Fayez Sarofim & Co.

Fayez Sarofim & Co. is a financial advisor firm headquartered in Houston. This large firm specializes in providing investment management services to a range of individual and institutional clients. There's a sizable team of financial advisors employed at this firm, and they oversee billions in client assets under management (AUM).

As a fee-only firm, all of Fayez Sarofim & Co.'s compensation comes from the advisory fees that clients pay. That means it doesn't take third-party commissions (such as from financial product or insurance sales), as a fee-based firm would.

Fayez Sarofim Background

Fayez Sarofim founded the firm that bears his name in 1958. Today, Sarofim still works at the firm, serving as its chairman and co-chief investment officer (CIO). The firm is a wholly-owned subsidiary of holding company The Sarofim Group, which is in turn owned by employees of Fayez Sarofim & Co. and members of the Sarofim family. Fayez Sarofim is the majority shareholder of The Sarofim Group.

The firm employs 15 chartered financial analysts (CFAs) and one certified public accountant (CPA).

Fayez Sarofim Client Types and Minimum Account Size

Fayez Sarofim & Co. provides services to a spectrum of clients, including both high-net-worth and non-high-net-worth individuals, investment companies, pooled investment vehicles, pension and profit-sharing plans, charities, government entities, insurance companies and corporations. Individuals without a high net worth make up the largest percentage of this client base.

Typically, the minimum investment requirement for new client accounts at this firm is $5 million. If you're looking to utilize the firm's Global Equity and International products, though, the minimum jumps to $10 million. Fayez Sarofim & Co. reserves the right to waive these minimums as it sees fit.

Services Offered by Fayez Sarofim

Fayez Sarofim & Co. focuses its services on investment management and counseling. The firm offers management programs like the Large Capitalization Equity Product, the Global Equity Product, the International Equity Product, the Concentrated Equity Product, the Equity Income Product, the Core Fixed-Income Product, Municipal Bond Portfolios and Balanced Portfolios. The firm can manage assets on both a discretionary and non-discretionary basis.

Wrap fee programs are available through this firm as well. Fayez Sarofim & Co. also acts as a sub-advisor for certain BNY Mellon mutual funds, as well as running its own mutual fund called the Sarofim Equity Fund.

Fayez Sarofim Investment Philosophy

The selection of investment programs at Fayez Sarofim & Co. is the basis for the firm's services. Whereas some firms will take the time to create personalized portfolio plans for each client, this firm creates sets of programs that clients then invest in. The investments that exist within these groups are chosen based on the recommendations of the firm's investment committee.

The specific securities that flesh out Fayez Sarofim & Co.'s investment programs vary, such that different programs appeal to different types of investors. With that being said, the firm tends to pursue long-term growth strategies, with a fundamental method of analysis typically informing the makeup of these strategies.

Fees Under Fayez Sarofim

Fayez Sarofim & Co. charges advisory fees based on a percentage of the assets that a client invests in a specific program. Each product utilizes different fee schedules, though all fees are billed in three-month rolling periods. For each of these periods, the market value of your account at the end of the last day that the NYSE is open will be used to determine the fees you owe.

Fee Schedule for Large Capitalization Equity Product, Concentrated Equity Product, Equity Income Product and the Equity Portfolios of Balanced Accounts
Account Size Annual Fee
First $2,000,000 0.75%
Next $18,000,000 0.50%
Next $20,000,000 0.40%
Next $20,000,000 0.35%
Over $60,000,000 0.20%

 

Fees for the Global Equity Product and International Equity Product
Account Size Annual Fee
First $50,000,000 0.60%
Next $50,000,000 0.40%
Over $100,000,000 0.30%

The annual fee for all fixed-income accounts and cash positions is 0.20%. If you use private placements, your annual fee will be 0.50%.

What to Watch Out For

Fayez Sarofim & Co. has two disclosures listed on its SEC-filed Form ADV. Both of these disclosures are attributed directly to the firm's founder, Fayez Sarofim.

Fayez Sarofim & Co. is solely focused on investment management, so unlike some advisor firms, it does not provide financial planning services. If you're searching for an advisor who can help you create a financial plan, try SmartAsset's free matching tool to find options in your area.

Opening an Account With Fayez Sarofim

Becoming a client of Fayez Sarofim & Co. is as easy as calling the firm at (713) 654-4484 or visiting its website and filling out a contact form so an advisor can reach out to you directly.

All information is accurate as of the writing of this article.

Tips for Your Retirement Plans

  • Regardless of whether you're new to retirement planning or you're about to retire, a financial advisor could be a big help. Luckily, finding an advisor in your area isn't hard with SmartAsset's free matching tool. If you're ready, get started now.
  • To figure out what kind of income you'll need in retirement, take a look at SmartAsset's retirement calculator. By entering information about your age, income and savings, you can see whether you're on pace for a secure retirement.

How Long $1mm Lasts in Retirement

SmartAsset's interactive map highlights places where $1 million will last the longest in retirement. Zoom between states and the national map to see the top spots in each region. Also, scroll over any city to learn about the cost of living in retirement for that location.

Least
Most
Rank City Housing Expenses Food Expenses Healthcare Expenses Utilities Expenses Transportation Expenses

Methodology We analyzed data on average expenditures for seniors, cost of living and investment returns to determine how many years of retirement a $1 million nest egg would cover in cities across America.

First, we looked at data from the Bureau of Labor Statistics (BLS) on the average annual expenditures of seniors. We then applied cost of living data from the Council for Community and Economic Research to adjust those national average spending levels based on the costs of each expense category (housing, food, healthcare, utilities, transportation and other) in each city. Using this data, SmartAsset calculated the average cost of living for retirees in the largest U.S. cities.

We assumed the $1 million would grow at a real return (interest minus inflation) of 2%. Then, we divided $1 million by the sum of each of those annual numbers to determine how long $1 million would cover retirement expenses in each of the cities in our study. Cities where $1 million lasted the longest ranked the highest in the study.

Sources: Bureau of Labor Statistics (BLS), Council for Community and Economic Research