Lockwood Advisors is a financial advisory firm that provides investment management services through a series of wrap fee programs that are offered in conjunction with BNY Mellon, its parent company. Located in Pennington, New Jersey, the firm indirectly works with individual and institutional clients through affiliated advisors.
Some advisors at Lockwood can earn extra compensation when they sell specific investment products. This makes the firm fee-based (as opposed to fee-only), though it still abides by its fiduciary duty to act in its clients' best interests.
Lockwood Advisors Background
Lockwood Advisors was founded in 1996 and acquired by The Bank of New York Company, Inc. in 2002. As a result, the firm is now an indirect subsidiary of The Bank of New York Mellon Corporation or BNY Mellon. The firm was previously based in King of Prussia, Pennsylvania, but relocated to its current home in New Jersey.
Lockwood Advisors is led by a team that includes director and chief investment officer (CIO) Matthew Forester, chief operating officer (COO) Joel Hempel and director of investments Tony Destro. The firm's investment staff includes two chartered financial analysts (CFAs) and one certified investment management analyst (CIMA).
Lockwood Advisors Client Types and Minimum Account Sizes
Lockwood Advisors has over 30,000 clients, almost all of whom are individuals without a high net worth. However, the firm also manages the assets of high-net-worth individuals, pension and profit-sharing plans, charities and businesses.
The minimum required investment for opening an account at this firm depends on the services you utilize:
|Program||Minimum Annual Fee||Subsequent Contribution Minimum|
|Lockwood Investment Strategies (LIS)||$250,000||$2,500|
|Lockwood WealthStart Portfolios||$10,000||$1,000|
|Lockwood Asset Allocation Portfolios (LAAP)||$50,000||$1,000|
|AdvisorFlex Portfolios (AFP)||$50,000||$1,000|
|Lockwood/American Funds Core Portfolios (LAFCP)||$10,000||$1,000|
|Lockwood ESG ETF Portfolios (LESG)||$10,000||$1,000|
|Lockwood Low Balance Portfolios (LLBP)||$1,000||$0|
Services Offered by Lockwood Advisors
Lockwood Advisors offers investment management services through three main wrap fee programs: the Managed360 Program, the Managed Account Advisor (MAA) program and the Lockwood Sponsored Program (LSP).
When it comes to Lockwood's discretionary portfolio management services, these are split between five products:
- AdvisorFlex Portfolios (AFP): A flexible mutual fund and exchange-traded fund (ETF) wrap fee account
- Lockwood Investment Strategies (LIS): A unified managed account made up of a single portfolio and including five core models and four alternative models
- Lockwood WealthStart Portfolios: A mutual fund and ETF wrap-fee product with a low minimum account size
- Lockwood Asset Allocation Portfolios (LAAP): A fixed mutual fund and ETF wrap-fee account
- Lockwood/American Funds Core Portfolios: A fixed mutual fund and ETF wrap-fee account, made up of American Funds mutual funds.
The firm also offers its services to third-party wrap fee programs. Additionally, Lockwood provides financial advice and research to institutional clients on mutual funds and ETFs.
Lockwood Advisors Investment Philosophy
Lockwood and BNY Mellon's advisors work together to determine investment strategies for each of their investment management and wrap fee programs. To do this, the firm engages in proprietary investment research that it gathers from a wide range of sources. Based on these findings, the firm formulates its own in-house risk- and objective-based strategies that eventually inform client-facing investment programs. Lockwood often builds its portfolios around mutual funds and ETFs, but not always.
Fees Under Lockwood Advisors
Advisory fees at Lockwood Advisors vary significantly between programs, though they are all based on a percentage of each client's assets under management (AUM). Fees are collected on a quarterly basis. However, none of the following rates are set in stone, as Lockwood reserves the right to negotiate or alter any of its fees.
|Lockwood Advisors Program Fee Schedules|
|Program||Annual Fee Rates|
|AdvisorFlex Portfolios||0.25% - 0.40%|
|Lockwood Investment Strategies (LIS)||0.30% - 0.75%|
|WealthStart Portfolios||0.10% - 0.30%|
|Lockwood Asset Allocation Portfolios (LAAP)||0.20% - 0.40%|
|Lockwood/American Funds Core Portfolios||0.10% - 0.30%|
|Lockwood Third Party Model Provider||0.04% - 0.11%|
|Lockwood ESG ETF Portfolios (LESG)||0.15% or less|
|Lockwood Low Balance Portfolios (LLBP)||0.15% or less|
What to Watch Out For
Lockwood Advisors has 10 regulatory disclosures on its Form ADV. While most of these belong to various advisory affiliates of the firm, there are two that apply to the firm directly.
One is in reference to the firm allegedly providing inadequate information about third-party money managers' "trading away practices." Lockwood Advisors paid $200,000 to the U.S. Securities and Exchange Commission and was ordered to cease and desist. The other action concerns alleged incomplete disclosures in regards to mutual fund share class fees. The firm paid $52,187.98 in restitution and interest, consented to a censure and was ordered to cease and desist.
It's also important to note that Lockwood Advisors is a fee-based firm, as some of its advisors can earn commissions for the sale of certain investment products. This dynamic creates a potential conflict of interest, as advisors may be more likely to recommend certain financial products over others. That said, the firm is still a fiduciary, legally binding its advisors to act in the best interests of its clients.
Opening an Account With Lockwood Advisors
There are two main ways you can open an account with Lockwood Advisors. The first is by simply calling the firm at (800) 200-3033. If you'd prefer to have an advisor reach out to you, fill out the contact form on the firm's website.
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