Major Risks with investment management agreement
Asset management under investment management agreement (including investment advisory agreement) may cause loss due to deterioration of its contracted assets value by fall of portfolio asset prices, deterioration of financial status, or bankruptcy of issuers of such portfolio assets, impact of foreign exchange variation as investment objectives includes mainly domestic and foreign stocks, bonds and other securities. Hence, your principal of investment is not guaranteed and may cause decline in the value of contract asset to suffer loss and lower its principal value. In addition, in derivative transactions, it may cause more loss than its margin deposit due to impact from fluctuation of financial indices which derivative transactions refer to, as derivative contracts trade more amount than the margin deposit as collateral. Due to differences in investment strategies and changes in domestic / foreign market environments, ratio of margin deposit to derivative transaction amount cannot disclose in advance.
Assets with investment management agreement should vary risks and natures due to difference in asset classes, investment restriction, trading market and countries with each contract, please refer to pre-contract documents before contracting the investment management agreement.
Fee for investment management agreement related to private asset investments
Fees and remunerations to us
We will ask for the investment management fee to you. Applicable rate or fee is subject to investment objectives, contract amount, terms etc., hence we cannot indicate fees or its cap in advance.
Other expenses：
You will owe other expenses than above (including brokerage fee and custody fees for securities). Those expenses are subject to portfolio management etc., hence we cannot indicate such expenses or those caps in advance. In addition, in case of investing into funds through investment management agreement, you will owe its management fees and other expenses (including audit fee, brokerage fees and custody fee borne by such fund) related to such fund investments.
For further information, please refer to pre-contract document or other documents.
Fee for investment management agreement related to hedge fund investments
Fees and remunerations to us
Remunerations pursuant to investment advisory contract or discretionary investment contact (“investment advisory fees”) are comprised of two separate charges; basic fee and performance fee, which will be determined, in principle, through individual negotiations between you and us (we may charge you only the basic fee for the relevant services based on an investment advisory contract) as below:
Basic fee: 0.5% – 5% per annum of the assets under contract. Provided, however, that we might offer you a fixed fee.
Performance fee: 10-35% of the increased portion of the assets under contract at fair value for the period of any pre-determined fiscal term under the contract. Provided, however, that we will not charge you any performance fee in any fiscal term unless the value of the assets under contract exceeds the highest asset value in the case of a continuing contract.
Consumption tax is subject to the amounts above. You will be required to pay the basic fee on a monthly basis and the performance fee on a yearly basis.
Where we invest your funds in an investment fund for which we act as investment manager, we will adjust the rate or amount of our investment advisory fees payable by you after taking into account our investment management fees receivable from such investment fund.
We cannot indicate in advance the size of such an adjustment because such adjustment is affected by the ratio of your assets invested in such investment fund to your total assets under our management.
We may charge you separate fees, after consultation with you, depending on specific situations, including, without limitation, situations where unique investment approaches are utilized or unique assets are managed.
Other expenses：
You will be responsible for bearing the following expenses that are deducted from your investment assets:
- Attorney’s fees, accountants fees and administrative and general expenses in connection with creation of the investment funds, etc., and sale of the beneficiary rights.
- Any relevant expenses in connection with investment into securities by the investment funds, etc., (commission on purchase or sale of securities, stock loan commission, interest expense on debt outstanding and any other expenses including system cost for investment programs and research expenses)
- Administrative expenses on the investment funds, etc., (expenses on accounting, auditing and any other administrative matters, attorney’s fees including their research expenses, as well as costs for reporting or providing information to existing and prospective investors).
- Investment fees incurred by the investment funds, etc.
Your trustee may separately charge trustee fee to you, in case you will invest through your trust assets entrusted to your trustee.
For further information, please refer to pre-contract document or other documents.