Item 1 – Introduction
RiverFront Investment Group (“RiverFront”) is a SEC-registered investment adviser that provides advisory services. This document is
a summary of the types of services we provide and how you pay for these services. Free and simple tools are available to research
firms and financial professionals at investor.gov/CRS. You can also find educational materials about broker-dealers, investmentsadvisers and investing at this site.
Item 2 – Relationship and Services
What investment services and advice can you provide me?
We offer investment advisory services to retail investors through separately managed accounts (SMAs) and unified managed accounts(UMAs) in third party sponsored wrap fee programs. As part of these services, we manage model investment portfolios for a range of
investment objectives, risk tolerances and investment themes through program sponsor firms (“Sponsor(s)”).
RiverFront provides advisory services to you on a discretionary basis, meaning RiverFront has permission to determine the securities
bought and sold in your account. Such discretion is exercised based on the model portfolio chosen by you in consultation with your
Financial Adviser and Sponsor. RiverFront’s models are not tailored to your individual needs, any restrictions you impose on the
account will be communicated to RiverFront by your Sponsor. RiverFront will review your discretionary account on a weekly basis to
ensure it is in line with the model portfolio that you have selected. For more information on how RiverFront reviews client accounts,
see Item 13 – of RiverFront’s ADV Part 2A.
RiverFront’s minimum opening account balance is typically $200,000 for Advantage SMA clients and $100,000 for ETF Advantage,
RiverShares and RSPO SMAs; however, we will consider accepting a lower initial account balance. For additional information about
the products we offer, see Item 4 – of our Form ADV Part 2A.
- “Given my financial situation, should I choose an investment advisory service? Why or why not?”
- “How will you choose investments to recommend to me?”
- “What is your relevant experience, including your licenses, education and other qualifications? What do these qualifications mean?”
Item 3 – Fees, Costs, Conflicts, and Standard of Conduct
What fees will I pay?
Sponsors set the fees for clients in their wrap fee program. RiverFront charges an advisory fee based on a percentage of the market value
of assets under management in your account. While these fees vary by program, they typically do not exceed 0.5% per year of the assets
we manage for you. These fees are usually charged quarterly in advance, although certain Sponsors may charge you in arrears or on a
monthly basis. Fees are generally deducted by the Sponsor directly from your account, please see your agreement with your Sponsor
for specific information regarding your billing schedule.
Wrap fee clients are typically not charged a commission on trades executed through the Sponsor. However, because RiverFront places
a significant amount of trades away from the Sponsor (also known as step?out transactions), and the commissions or other fees for these
trades are in addition to the wrap fee.
RiverFront’s management fees are separate and distinct from fees and expenses charged by registered investment companies (i.e., mutual
funds, closed-end funds, and exchange-traded funds “ETFs”), which are held in client accounts or recommended by RiverFront to
clients. A description of these fees and expenses is available in each fund's prospectus. RiverFront’s fee does not include brokerage
commissions, transaction fees, custodial fees, transfer taxes, wire transfer fees, electronic fund fees, and other possible taxes and fees.
These ancillary fees and costs should appear on your quarterly statement that you receive from your broker and/or custodian.
You will pay fees and costs whether you make or lose money on your investments. Fees and costs will reduce any amount of money
you make on your investments over time. Please make sure you understand what fees and costs you are paying. Because we charge an
asset-based fee, the total fees you pay us will increase with the size of your account. This creates an incentive for us to recommend that
you increase the assets in your account. For additional information, please see Item 5- of our Form ADV Part 2A..
• “Given my financial situation, should I choose an investment advisory service? Why or why not?”
• “How will you choose investments to recommend to me?”
• “What is your relevant experience, including your licenses, education and other qualifications? What do these
“Help me understand how these fees and costs might affect my investments. If I give you $100,000 to invest, how much will go to fees and costs? How much will be invested for me?”
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What are your legal obligations to me when acting as my investment adviser? How else does your firm make money and what conflicts of interest do you have?
When we act as your investment adviser, we have to act in your best interest and not put our interest ahead of yours. At the same time,
the way we make money creates some conflicts with your interests. You should understand and ask us about these conflicts because
they can affect the investment advice we provide you. Below are some examples to help you understand what this means.
RiverFront permits its associates to engage, on a limited basis, in personal securities transactions. As a result, associates may purchase
or sell the same or similar securities at the same time that we place transactions for you. To avoid potential conflicts of interest involving
personal trades, RiverFront has adopted formal insider trading and personal securities transactions policies and procedures.
As described in Item 2 on the previous page, RiverFront provides investment advisory services to you as part of wrap fee programs
sponsored by various broker-dealers (Sponsors). Robert W. Baird & Co, Inc. (“Baird”), a minority owner of RiverFront Investment
Holding Group, LLC, is also a Sponsor, and RiverFront conducts maintenance trades and step-out trades for Baird accounts on behalf
of its discretionary wrap-fee client accounts. RiverFront does not, however, direct any step-out transactions through Baird.
RiverFront associates may also attend educational seminars and events hosted by vendors, Sponsor Firms, or ETF providers (“Outside
Parties”). These Outside Parties pay for reasonable travel, lodging, and other expenses related to the event; they may also co-sponsor
or sponsor RiverFront’s attendance at these events. RiverFront often uses the ETFs managed by Outside Parties within client models.
Outside Parties will share expenses for RiverFront-sponsored events, marketing campaigns, and/or broker-dealer sponsored events in
the form of sponsorships. These activities create conflicts of interest as RiverFront will have an incentive to use vendors and/or ETFs
sponsored by firms that participate in the activities above. RiverFront does not consider these benefits provided by Outside Parties when
selecting investment products for client portfolios. Nonetheless, RiverFront monitors these activities and requires that any expenses
paid, or sponsorships received be reasonable in value.
Additionally, RiverFront will invest its portfolios in various ETFs. Some of these ETFs will be sponsored by or affiliated with brokerdealers
through which RiverFront also executes your trades. RiverFront’s due diligence and security selection process does not take into
consideration whether the ETF sponsor for a particular security is affiliated with a broker-dealer that RiverFront uses to execute your
trades. For additional information, please see Items 11, 12 and 17 of our Form ADV Part 2A.
“How might your conflicts of interest affect me and how will you address them?”
How do your financial professionals make money?
RiverFront associates are compensated through the revenue generated by the clients they serve (advisory fees). Neither RiverFront nor
any of its supervised persons accept compensation for the sale of securities or other investment products, including asset-based sales
charges or service fees from the sale of mutual funds or ETFs. Certain RiverFront associates receive compensation based in part on
gross sales and assets under management of RiverFront’s investment programs and Funds. This compensation received by those
associates is structured so that it does not incentivize the sale of any given product over another.
Item 4 – Disciplinary History
Do you or your financial professionals have legal or disciplinary history?
On July 14, 2016, RiverFront, without admitting or denying any violation or wrongdoing, consented to the entry of an order instituting
administrative cease-and-desist proceedings (order) in settlement of an administrative proceeding instituted by the SEC for alleged
violations of Sections 207 and 204(a) of the Investment Advisors Act of 1940 and Rule 204-1. For more information, please see Item 9
of our Form ADV Part 2A. A free and simple search tool to research us and our financial professionals is available at investor.gov/CRS.
“As a financial professional, do you have any disciplinary history? For what type of conduct?”
Item 5 – Additional Information
Additional information about our investment advisory services and an up-to-date copy of the relationship summary is available by
calling us at (866) 583-0744 or emailing the Chief Compliance Officer at firstname.lastname@example.org.
“Who is my primary contact person?”
“Is he or she a representative of an investment adviser or a broker-dealer?”
“Who can I talk to if I have concerns about how this person is treating me?”