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FAQs- Custodian

Who is your custodian and what is their purpose?

Folio Investments, Inc. is a self-clearing registered broker-dealer with billions of dollars under custody and thousands of advisors and institutions on their platform. They are responsible for all SIPC insurance as the broker/dealer on the account, and they allocate client cash to over 10 third-party FDIC insured banks, who hold your cash deposits. This allows us to offer the industry’s highest and most secure cash vehicle. We partner with Folio for a variety of reasons such as increasing the security of your investments and SIPC and FDIC insurance. We also believe that outsourcing custodial services better allows us to focus on investment management and asset allocation.

What happens if Folio goes out of business?

In the unlikely event that Folio Institutional were to become insolvent, your brokerage accounts are covered by SIPC insurance, SIPC insurance protects against losses stemming from the financial failure of SIPC member brokerage firms. SIPC insurance protects the securities and cash in a brokerage account up to $500,000 (which includes a limit of $250,000 protection for cash in an account). SIPC insurance protection for customers with multiple accounts is determined by “separate capacity” as defined by SIPC. A brochure explaining SIPC coverage is available on the SIPC website (www.sipc.org). Independent of and in addition to SIPC coverage, Folio Institutional provides brokerage customers with additional supplemental insurance coverage, which would only be used when SIPC insurance coverage is exhausted. Purchased from underwriters at Lloyds of London this separate, supplemental insurance provides coverage for an additional amount of loss to clients limited to a combined aggregate return to all customer from SIPC and certain underwriters at Lloyds of London of $10 million each with a sub-limit of $900,000 to cover cash based on any one customer’s presentation of an excess SIPC claim. Neither SIPC insurance nor the supplemental insurance coverage protects against investment losses from the decline in the market value of securities. In addition to the SIPC insurance coverage for cash, you also may be entitled to insurance through the Federal Deposit Insurance Corporation (“FDIC”). All cash deposits held in Folio Institutional’s bank sweep program (“the Program” as defined in Exhibit 2 to the Folio Institutional Customer Agreement), by account ownership category as recognized by the FDIC, are covered by insurance from the FDIC, up to certain amounts. Under the Program, Folio Institutional provides extended FDIC insurance by placing your cash, by account ownership category, in a bank or multiple banks when it would exceed the limits of any one bank. For the number and identity of the current banks in the Program, the available FDIC insurance, and a full explanation of the Program please see Folio’s website. You can get publicly available financial information concerning any or all of the banks at http://www.ffiec.gov/nicpubweb/nicweb/nichome.aspx and more detail on FDIC insurance from http://www.fdic.gov/deposit/deposits/index.html by contacting the FDIC Public Information Center by mail at 3501 North Fairfax Drive, Room E-1005, Arlington, VA 22226 or by phone at (877) 275-3342 or (703) 562-2200.

What happens if Altruistic Investing goes out of business or is acquired by another firm?

If Altruistic Investing were to go out of business or were to be acquired by another company, you would maintain complete control over your assets held by Folio, a SEC registered broker dealer that provides custody related services to clients within the Program. You would be free to add or withdraw money from your Folio account at any time.

Why do you use a custodian?

We partner with Folio for a variety of reasons such as increasing the security of your investments and SIPC and FDIC insurance. We also believe that outsourcing custodial services better allows us to focus on investment management and asset allocation. Altruistic Investing specializes in digital wealth management, Folio specializes in account servicing.

Are my investments insured through SIPC?

Yes, SIPC insurance is provided on all investment accounts. This means your securities are insured up to $500,000 for each client (including $100,000 on claims for cash). SIPC covers against losses stemming from a member broker/dealer’s financial failure.