As a pioneer in the industry, we are the first to give 100% Cashback on trailer fees that we receive from fund managers to our clients.
Trailer fees are a form of commission paid by fund managers to distributors (i.e. your broker/financial advisor). This commission is paid continuously, so long as the client continues to hold the funds, and usually ranges between 15%-50% of the annual fund fees, which could be as much as 1% per annum. This potentially leads to misalignment of incentives between an investor and distributor, and higher fund fees.
Endowus clients get these trailer fees back as Cashback. This is so that we, as your financial advisor, are always aligned to your best interests, and continuously work to improve your investment outcomes and lower your costs. When available, Endowus also saves you money by accessing institutional share classes of funds that are lower cost and have no trailer fees embedded.
Generally, we distribute the Cashback on a quarterly basis. Thus, you can generally expect to receive the Q1 Cashback in Q2.