Neither Natalliance, LLC (“Natalliance”), a member of FINRA and SIPC, and a broker-dealer registered with the SEC nor any of its affiliates, makes any representation or warranty regarding the correctness of any information contained herein, or the appropriateness, for any person, of any transaction. The information contained in this electronic message and any attachments to this message are intended for the exclusive use of the addressee(s) only and may contain confidential or privileged information. Any errant transmission is not intended to waive confidentiality or privilege. No representation is made on its accuracy or completeness of the information contained in this electronic message and any attachments. If you are not the intended recipient, you are hereby notified that any dissemination, distribution or copying of this e-mail and any attachment(s) is strictly prohibited. Please reply to the sender and immediately destroy all copies of this message and any attachments from your system.
When you invest through a brokerage account, your representative receives a commission for buying or selling securities products. This compensation occurs on a transaction basis. As a result, a brokerage relationship may be best for clients who are seeking a pure buy-and-hold strategy. In addition, through a brokerage relationship, your representative may provide education, research, and information about financial products, but he or she is not obligated to provide ongoing investment advice, which is a duty of an advisor to clients in an advisory relationship. Also unlike an advisory relationship, you may not provide your advisor with discretion to buy and sell securities for you in a brokerage account; instead, you must approve each transaction prior to execution
The commissions you pay will depend on the type and nature of the security purchased or sold in your account. Brokerage accounts also will incur certain account fees. For a list of fees charged by Hilltop Securities, our custodian for brokerage accounts and related services, please see the Correspondent Customer Information Brochure
Fixed Income Client Statement Pricing Disclosure
Unlike equities where prices are usually evaluated based on their daily closing prices, bonds generally do not have a uniform closing price, as a majority trade in over-the-counter (OTC) markets or a negotiated market. Additionally, bond prices are affected by many different factors and, consequently, are often derived using pricing models and/or benchmark indices. These factors include but are not limited to; issuer’s credit rating, order size and other features as well as by valuation methods used by independent pricing services.
Third-party resources may provide comparative prices for evaluation purposes. NatAlliance Securities LLC through a third-party pricing vendor supplies these independent daily bond valuations. Typically, pricing services use proprietary pricing models which may or may not be an accurate representation of actual prices. A continually changing market environment presents additional challenges, which may affect the price of bond valuations and, consequently, make statement prices less reliable indications of at what price certain bonds may be trading.
Actual bond prices are determined by what someone is willing to pay – a bid price reflects the price at which a customer can sell. Consequently, an offer or ask price reflects the price at which a customer can buy. The difference between the two prices is referred to as the price spread. When conditions of significant increases in price volatility, the spreads between bids and asks for bonds can increase to wide levels, making bond valuations even less precise. Bond prices reflected on statements are “best-effort estimates” which can be useful for evaluating a portfolio and establishing an allocation mix. However, they should not be interpreted as actual bid or ask prices.
Clients should carefully review their monthly statements and monitor changes in bond prices. However, investment decisions should not be based solely on statement pricing as it may not be indicative of current market prices. Any investor interested in selling bonds prior to maturity should seek assistance from their financial professional. Additionally, when purchasing a bond, clients can evaluate the pricing they received at http://emma.msrb.org/ and http://finramarkets.morningstar.com/BondCenter/Default.jsp or by contacting your financial representative.