| APW Capital, Inc. is registered with the U.S. Securities and Exchange Commission (SEC) as a broker-dealer, and Aurora Private Wealth, Inc., and Comprehensive Capital Management, Inc. are registered with the SEC as investment advisers. References below to “we”, “our” or “us” refer to these entities and their associated persons collectively.
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| Our clients work with their investment professionals to determine the services that are most appropriate given their financial goals and circumstances. Based on the services you request, we can act as a broker-dealer, as an investment adviser or as both. Some of our investment professionals are qualified and licensed to provide both brokerage and investment advisory services. In addition, certain of APW Capital, Inc.’s investment professionals are licensed through unaffiliated investment advisers. This document provides important information about the distinctions between entities that we control and operate. You will also want to review the Form ADV Part 2A and Form CRS (as applicable) for any unaffiliated investment adviser that you may engage.
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| In addition, some of our investment professionals hold educational or professional credentials, such as the CERTIFIED FINANCIAL PLANNERTM (CFP®) designation (Certified Financial Planner Board of Standards Inc. own these certification marks in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements). Holding a professional designation typically indicates that the investment professional has completed certain courses or continuing education. However, an investment professional’s designation does not change ours or your investment professional’s obligation in providing investment advisory or brokerage services to you.
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| It is important to understand that brokerage and investment advisory services are separate and distinct and each is governed by different laws and separate arrangements that we may have with you. The specific services we provide, our relationship with you and our legal duties to you in each arrangement are described in our applicable contracts with you. This disclosure summarizes the key distinctions between brokerage and investment advisory services and our respective duties and obligations. We encourage you to review this document carefully, along with your applicable contracts, and discuss it with your investment professional.
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| Our services as a broker-dealer and relationship with you |
| Although a brokerage relationship can be a cost-effective way of investing your assets, it is not for everyone. As a brokerage client, you need to understand and agree to our service limitations and conflicts. |
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In our capacity as broker-dealer, we generally make recommendations to our brokerage clients about whether to buy, sell or hold securities. We do not make investment decisions for you or manage your accounts on a discretionary basis. We will only buy or sell securities for brokerage clients based on specific directions from you.
You may open a brokerage account through APW Capital, Inc. who then introduces the account to Pershing, LLC. Alternatively, you may hold certain securities directly through the sponsor of those securities (which we sometimes refer to as holding your securities direct).
We receive transaction-based compensation for trades you decide to enter into, which includes commissions, administrative fees and compensation from third parties that are disclosed to you.
Unlike how we or our unaffiliated investment advisers might charge for investment advisory services, we do not charge or receive a separate fee for our advice or recommendations and our recommendations are provided solely incidental to our brokerage services.
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| Our responsibilities to you as a broker-dealer |
When APW Capital, Inc. acts as a broker-dealer, including when we recommend securities transactions, recommend that you enroll in an investment advisory program or make any recommendation on an account that has terminated investment advisory services, APW Capital does not act as a “fiduciary” under the federal securities or retirement laws nor as a registered investment adviser.
When we act as your broker-dealer, we are subject to the Securities Exchange Act of 1934, the Securities Act of 1933, the rules of self-regulatory organizations such as the Financial Industry Regulatory Authority (FINRA), the rules of the New York Stock Exchange and applicable state laws. The standards for broker-dealers under these rules and regulations include the following:
- o As your broker-dealer, we have a duty to deal fairly with you. Consistent with our duty of fairness, we are obligated to make sure that the prices you receive when we execute transactions for you are reasonable and fair in light of prevailing market conditions and that the commissions and other fees we charge you are not excessive.
- o We must have a reasonable basis for believing that any securities recommendations we make to you are suitable and appropriate for you, given your individual financial circumstances, needs and goals.
- o We are permitted to trade with you for our own account (a practice termed “principal trading”) or for an affiliate or another client and may earn a profit on those trades. When we engage in these trades, we disclose the capacity in which we acted on your confirmation, though we are not required to communicate this or obtain your consent in advance or to inform you of the profit earned on the trades. Absent special circumstances, we are not held to the same legal standards that apply when providing investment advisory services to you. Our legal obligations to disclose detailed information to you about the nature and scope of our business, personnel, fees, conflicts between our interests and your interests and other matters are more limited than when we are providing investment advisory services to you.
You are responsible for understanding and agreeing to our service limitations and for considering and evaluating our conflicts.
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| Conflict of interest: Transactional compensation |
When we act as a broker-dealer, we are compensated by the commissions and fees you pay us as well as through revenue we receive from third-parties that often include the sponsors of investment products. Your financial professional does not receive a portion of all of these types of payments so that some conflicts apply at the financial professional level and some apply only to APW Capital, Inc. at the firm level.
Financial professional conflicts include incentives to recommend:
- o Investments that result in greater compensation;
- o that you trade more frequently; and
- o products that provide the financial professional with reimbursements for marketing expenses.
APW Capital, Inc. firm-level conflicts include incentives to:
- o Offer products and services from companies that offer us revenue;
- o Maintain cash in a money market fund in an account introduced by APW Capital, Inc. and maintained at Pershing, LLC.
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| We have no duty to provide ongoing recommendations or monitor your investments |
We are not obligated to provide recommendations to you, or to update recommendations made previously, and not doing so should not be viewed as a recommendation to hold an investment.
We will not (and have no obligation to) monitor your account investments (including cash and cash equivalents) on an ongoing basis. However, if you have an investment advisory relationship with Aurora Private Wealth, Inc., Comprehensive Capital Management, Inc., or an unaffiliated investment adviser, your financial professional may agree to provide ongoing advice regarding investments that you purchase from APW Capital, Inc. Any agreement to do so must be in writing.
You are responsible for independently ensuring that the investments in your retirement account remain appropriate, given your investment objectives, risk tolerance, financial circumstances and investment needs.
By choosing brokerage for your assets, you must understand these conflicts and limitations and agree that we are not acting as a “fiduciary” with respect to any recommendations we provide regarding the assets held in your brokerage account. You also acknowledge that “Understanding our Fees and Compensation Practices” disclosure at www.aurorapw.com/fees.php contains a more detailed discussion of our compensation practices and limitations. If you want a fiduciary relationship with us under the federal securities laws, then consider engaging one of our affiliated investment advisers or contact an unaffiliated investment adviser.
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| Our services as an investment adviser and relationship with you |
| We believe that investment advisory services can help investors pursue their investment objectives. However, the fees and expenses associated with advisory services may exceed those that apply to brokerage services. Advisory services are not for everyone. Please speak with your investment professional for additional information. |
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In our capacity as an investment adviser, we offer a number of investment advisory services and programs, including fee-based financial planning, discretionary investment management and non-discretionary investment advisory programs, and advice on the selection of investment managers, mutual funds and exchange traded funds and other securities offered through our investment advisory programs. You may be able to receive all of these services and others through an unaffiliated investment adviser.
The fees for these services and programs are calculated as a percentage of assets in the account or a flat or annual fee and are charged on an ongoing basis. Unaffiliated investment advisers may have different fee structures.
When we act as your investment adviser, we will enter into a written agreement with you expressly acknowledging our investment advisory relationship with you and describing our specific obligations to you. At the beginning of our advisory relationship, we will give you our Form ADV Part 2A brochure or a similar wrap fee program brochure, which provides detailed information about, among other things: the program(s) you select; the advisory services we provide; our fees, personnel, other business activities and financial industry affiliations; and describes our conflicts of interests. Unaffiliated investment advisers are required to provide similar disclosure documents.
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| Our responsibilities as an investment adviser |
| When you participate in one of our investment advisory programs, we are considered to have a fiduciary relationship with you under the Investment Advisers Act of 1940. Our responsibilities include the obligation: |
To disclose all material facts to you, including conflicts of interests. Please see Aurora Private Wealth, Inc.’s or Comprehensive Capital Management, Inc.’s Form ADV brochures for our conflicts of interest disclosure at:
Aurora Private Wealth, Inc. - https://adviserinfo.sec.gov/firm/brochure/281604
Comprehensive Capital Management, Inc. - https://adviserinfo.sec.gov/firm/summary/119890
To inform you if we or our affiliates receive additional compensation from you or a third party as a result of our relationship with you.
How we seek best execution of your securities transactions.
To act in what we reasonably believe to be your best interests, and in the event of a conflict of interest, place your interests before our own.
Provide recommendations that we reasonably determine are suitable for you given your individual financial situation, investment objectives and goals (based on information you provide) and that are consistent with any restrictions you have placed on us.
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| Conflict of interest—asset-based compensation |
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When we act as your investment adviser, we and our financial professionals earn more when you invest more in your advisory account, and we earn the same advisory fee rate regardless of how frequently you trade. In certain instances, your financial professional may directly pay the transaction costs in your account. We also stand to receive payments from third parties, including the investment products in which you invest. These third-party fees are disclosed in our Form ADV Brochure and the investment product’s prospectus and other offering documents.
This creates an incentive for us to recommend that you:
Increase the assets in your advisory accounts to increase our fees;
o Invest in investment products that result in greater compensation to us (including products and services provided by us and our affiliates or those for which we receive a portion of product-level fees that you pay); and
>Maintain cash balances in a sweep investment or money market mutual fund that provides us with revenue.
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| Ongoing Advice and Monitoring |
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If you maintain a relationship with one of our affiliated investment advisers or an unaffiliated investment adviser, then that entity will provide advice and management services (as applicable) on an ongoing or agreed upon basis.
That entity may agree to monitor your account investments (including cash and cash equivalents) and provide investment recommendations on an ongoing basis.
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By choosing an investment advisory program, you understand these conflicts and limitations and that you will pay a separate fee for those services. You also acknowledge that Aurora Private Wealth, Inc.’s or Comprehensive Capital Management, Inc.’s Form ADV brochures at
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| Aurora Private Wealth, Inc. - https://adviserinfo.sec.gov/firm/brochure/281604 |
| Comprehensive Capital Management, Inc. - https://adviserinfo.sec.gov/firm/summary/119890 |
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| and our “Understanding our Fees and Compensation Practices” disclosure at www.aurorapw.com/fees.php contain more detailed discussions of these conflicts, compensation practices and limitations. If you have any questions or concerns, please talk to your financial professional. If you do not want to pay for fee-based ongoing investment advice and monitoring through an investment advisory service, then consider opening a brokerage account instead.
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