Letter from the CEO

Nearly two years ago the Clearwater Capital team committed ourselves to a deep review of our entire business model.  Following ten successful years in a rapidly evolving industry, we knew that we could take nothing for granted if we were to continue to excel.  Everything was on the table as we studied and evaluated all elements of our independent practice.    

This project has led to the relocation of our offices and the rebranding of our firm to Clearwater Capital Partners.  In addition to these highly visible changes, we have been quietly enhancing our technology, adding professional staff, and upgrading critical systems.  We have invested nearly $1 million dollars to reinforce our position as a world-class provider of comprehensive wealth services.  Now we have more exciting news to share with you. 

We are pleased to announce that we have selected Charles Schwab & Co., Inc. (“Schwab”), a subsidiary of The Charles Schwab Corporation, to be our premier custodian of record.  Going forward Clearwater Capital will be utilizing Schwab’s institutional platform for our client accounts and investment activity.

When it comes to serving our clients, and caring for their financial well-being, we have never settled for "good enough," and we certainly will not accept anything less than the finest possible resources available in the industry today.  Ultimately, this guiding principle led us to choose Schwab; a well-established organization currently supporting over 7,000 firms with client assets in excess of $3.36 trillion.  Schwab has a long history of financial viability and a 25-year track record of supporting the independent advisor and their clients.

Our team has worked diligently to earn the trust of our clients and we maintain that trust through full transparency and accountability.  From our first day we have operated according to the Fiduciary Standard of Care.  By definition of law, we are required to provide our clients with the very best resources and capabilities available, according to our experience and judgment.  This responsibility is perfectly aligned with our core principles and has led to our selection of Schwab.

The transition to Schwab as our custodian of record also sets into motion a series of additional enhancements to our client experience.  Soon we will have a suite of digital client facing tools including a sophisticated online client portal, a Clearwater Capital mobile app and significantly improved reporting functions.  All of these capabilities will be supported by the strictest security standards.

Our size and success have in part made the choice of Schwab as our custodian possible.  The institutional channel of Schwab is currently #1 in market share for successful advisors, serving 72% of the $1 billion plus RIA firms (based on Schwab internal estimates).  Size and scale will now make it possible for us to reduce or entirely eliminate certain brokerage related expenses for our clients. 

Specifically, we will be removing all account maintenance fees, all IRA account custodial fees, and Clearwater Capital will now absorb all trading costs for clients.  Other expenses being eliminated include securities and estate valuation fees, late settlement fees, duplicate statement and confirm fees (including those older than 90 days).  And of course, all expenses related to the Schwab transition itself will be fully covered by Clearwater Capital.   

Expenses are an important consideration in the selection of third party organizations necessary to support our advisory and investment activities.  We would never make important choices based solely on costs, however we are especially pleased that this transition allows us to greatly enhance the services and value to our clients while driving expenses down.

We take very seriously our duty to provide an outstanding suite of capabilities for our clients.    We value the trust our friends and clients have placed in Clearwater Capital Partners LLC and we are quite confident the improvements we have pursued are significant for our firm - and more importantly, for our clients.

We are excited to share these details of our two year transformation at this time, and we look forward to continuing to lead and innovate in the years ahead.  

Best regards,

John E. Chapman, CEO