FAQ
Q: What do I need to do to purchase an Archford sponsored Market Participation CD?
A: The first thing to do is to setup an account and an Archford Investment Advisor will contact you.
Q: How can my investment be principal guaranteed by the FDIC but still take advantage of a rising stock market? This sounds too good to be true.
A: These investments have been around for a while but not widely publicized. They did gain recent popularity with the 2008 stock market crash. In addition, some of these investments become very complicated, highly volatile, and difficult to understand. These Market Participation CDs are backed by major financial institutions when held to maturity. To learn more, read Market Participation CD’s Explained.
Q: Is it true these investments are only offered once a month?
A: Yes, the current Treasury Yield, market outlook, and investment expenses are the three variables that are taken into account during each offering release. Banks require lead time to package each offering which is why they are offered monthly.
Q; Are all Market Participation CDs the same?
A: No, there are many different Market Participation CDs ranging from very simple investment strategies to very complex scenarios. In addition, not all of these CDs are FDIC insured. Archford sponsored Market Participation CDs are based on simple investment strategies that are easy to understand.
Q: Why does the balance on my statement appear lower than my original investment?
A: Your statement will show your balance net of fees and also include market gains or losses. Also remember, your original investment, prior to any fees, is protected by FDIC insurance up to the $250,000 FDIC limit.
Q: Can I personally buy an Archford sponsored Market Participation CD?
A: Yes, but there are different tax consequences for individual investors compared to different legal entities that you will want to understand before investing.
Q: Can I sell my Archford sponsored Market Participation CD before its maturity date?
A: Yes, but be aware these investments are not widely traded and will typically trade at a discount on the open market. This is why we have lined up pre-approved loans on these investments. Note – qualified accounts with the exception of ESOPs will be unable to borrow against the investment.
Q: Are the gains on Archford sponsored Market Participation CDs also covered by FDIC Insurance?
A: No, only your original principal investment, prior to any and all fees, is covered by FDIC Insurance.
Q: What if I have other deposits with the bank that issued the Archford sponsored Market Participation CD?
A: This could impact your FDIC coverage which is why we offer the FDIC coverage tracking software. Understand that the pass-through coverage in a qualified plan for participations of $250,000 is independent of their personal FDIC exposure.
Q: How can I ensure my Archford sponsored Market Participation CD is actually covered by FDIC Insurance?
A: The prospectus will identify the Institution providing the FDIC coverage.
Q: Does Archford Capital Strategies hold or control any of my money or investments?
A: No, all of your investments and cash are held by Pershing, A Bank of New York Mellon Company, who is the largest custodian of financial assets in the world.
Q: What are the investment expenses?
A: There are three components of investment expenses. The Custodian Fee, Money Center Bank Fee, and Advisory Fee. Note that your stated participation is net of all three fees indicated. Archford, as a registered investment advisor, will earn an ongoing investment advisory fee as your investment management. In addition, the broker-dealer and other unaffiliated parties involved in the issuance of the Market Participation Fees will charge a commission based on the percentage of the initial investment value. Archford does not receive any portion of these commissions or fees, aside from its advisory fee.