Portfolio Management Services

With Peridot Capital Management, no two client portfolios are the same.  If you own mutual funds, every shareholder owns the same fund.  Your fellow investors may have different investment objectives and risk tolerances than you.  Peridot takes your investment goals, and only yours, to heart when constructing your portfolio. Only after understanding how much risk you wish to take and what kinds of investments you prefer, do we then build a winning portfolio for you. 

Mutual fund owners dislike paying taxes on capital gains distributions even when their fund loses value.  PCM manages portfolios with the tax law in mind.  Some managers will simply try to maximize gains, sticking you with a huge tax obligation.   If you have a tax exempt account, we will focus on taking advantage of that with income-producing investments that are shielded from taxes.  If your account is taxable, we will work to maximize your investment returns and minimize your capital gains taxes.  

Portfolios managed by Peridot are kept with discount brokerages that provide online access.   That way, you can see how much your portfolio is worth and what investments you own 24 hours a day, 7 days a week from any computer.  No more having to rely on portfolio holdings from a mutual fund company that are six months outdated or monthly account statements from your broker.

With Peridot, you have direct access to the portfolio manager who is overseeing your account.  Maybe you think that a certain company you read about may be worth a closer look, or maybe you are a socially responsible investor and wish to avoid tobacco, alcohol, or gaming stocks.  Even if you prefer to be hands-off and let us take care of everything, our investors are always free to give us a call to discuss their account.

The Details

Since the greatest strength of Peridot Capital Management is superior portfolio management, we only manage accounts held with brokerage firms that offer online access.  We prefer to spend our time researching investments and managing portfolios, not taking custody of assets, sending out transaction confirmations and monthly account statements, or other back office functions.  So, if you have an account with a firm that offers online trading, there is no need to move any of your assets.  If you do not have such an account, opening one is quick and simple on the Internet.

Because Peridot never takes custody of your investment assets, the only access we have to your portfolio is via trading authorization.  By giving us "limited power of attorney" privileges over your online brokerage account, we can spend all of our time trying to make sure that you own the right investments at the right time. Nothing with your account will change, so you may deposit and/or withdraw funds quickly and easily by phone, mail, or from any computer. In fact, since we only request "limited" power of attorney powers from you, we are not allowed to withdraw or deposits funds. We will only be authorized to enter buy and/or sell orders on your behalf.   

By demanding an online broker, Peridot can ensure the lowest possible commissions.  Full service commissions in this day and age are simply unnecessary. We believe that our business model for portfolio management services minimizes the investors' cost, maximizes ease of use, and most importantly, generates the highest possible investment returns.

Independent Research

Many financial advisors will base their buy and sell recommendations on their firm's research reports.  As investors have saw in the 1990's, the objectivity of research analysts on Wall Street is compromised due to investment banking and other conflicts of interest. We conduct our own independent research, and as a result, our views on particular investments will never be biased in any way.

Management Fees

Many investment professionals are compensated solely on commission.  Inherently, they do not have the client's interests aligned with their own. Their compensation is not based on performance, but rather on how many buy and sell orders are placed. Frequent trading has been proven to hurt long-term performance. Commission-based fees serve to motivate frequent trading, whereas asset-based fees, like ours, offer incentives for capital protection and appreciation.  

Peridot does not endorse commission-based compensation for investment management services.  Our fees are calculated as a percentage of total assets in order to align the interests of both the client and the investment manager.  If the client makes money, the manager's fee increases.  If money is lost, the manager is penalized with a lower fee.

Peridot charges between 1% and 2% of total assets per year depending on the value of the client's portfolio, which is equal to the expense ratio of the average mutual fund. We seek to provide a more valuable service to our clients than mutual funds do, all for the same price mutual funds charge. Clients may choose to prepay their portfolio management fee either quarterly or annually.  Choosing to prepay annually could result in a discounted fee.   Also, our portfolio management fee is considered by the IRS to be a "miscellaneous" tax deduction, unlike mutual fund fees or commissions paid to a broker. This fee structure combined with low commissions and favorable tax treatment allows for superior investment results at a lower cost to our clients than a traditional broker or mutual fund company relationship.

Please Note: While the fee schedule above is typical, PCM's portfolio management services are
personalized for each client, and as a result, fees are negotiable based on one's desired service.