Form ADV Part 3: Relationship Summary – June 2020
Introduction
Leeb Capital Management, Inc. (“LCM”) is registered with the U.S. Securities and Exchange Commission (“SEC”) as an investment adviser. Clients and prospective clients should be aware that services and fees differ between investment advisers and broker-dealers and it is important for retail investors to understand the differences. Free tools are available to research advisory firms at investor.gov/CRS, which also provides educational materials about broker-dealers, investment advisers and investing.
What investment services and advice can you provide me?
LCM offers investment supervisory services which involves LCM providing you with continuous and ongoing supervision over and management of your specified accounts (collectively, the “Account”). As part of the service, we actively monitor the Account and provide advice regarding buying, selling, reinvesting or holding securities, cash or other investments of the Account, and we execute trades.
LCM offers its services on a discretionary basis, meaning we will have the authority to determine the type and amount of securities that can be bought or sold for your portfolio without obtaining your consent for each transaction. You must appoint our firm as your investment adviser of record on the Account and grant us the authority to determine the assets to purchase or sell in the Account. However, you will have the ability to place reasonable restrictions on management of the Account, such as the types of investments that can be purchased in your Account. The Account consists only of separate account(s) held by qualified custodian(s) under your name. The qualified custodians maintain physical custody of all funds and securities of the Account, and you retain all rights of ownership (e.g., right to withdraw securities or cash, exercise or delegate proxy voting and receive transaction confirmations) of the Account. The Account is managed by us based on your financial situation, investment objectives and risk tolerance.
LCM’s investment supervisory services focus on the selection of domestic stocks but also may include foreign stocks, bonds, options, mutual funds, annuities and money markets. We currently offer three main investment strategies, focused on growth, income, and natural resources. Please refer to LCM’s ADV Part 2A, Item 8 for more information about each strategy.
Requirements to open and maintain an account: LCM generally requires discretionary separately managed accounts to have a minimum account value of $100,000. However, in certain cases, at its discretion, LCM will waive this requirement.
Additional Information: Additional information on relationships, fees and services can be found in the LCM Form ADV, Part 2A (items 4-7) which is available on our website at www.leeb.net.
What fees will I pay?
Principal Fees and Costs: LCM management fees for discretionary accounts are based on a percentage of the value of the assets in your separately managed account for which we are providing services. The annual fee for investment supervisory services will be based upon a fee schedule which generally ranges between 1.00% and 2.00% depending on the strategy used to manage your account. Please refer to LCM’s ADV Part 2A, Item 5 for more information. LCM retains full authority to negotiate the fees it charges for discretionary advisory services. LCM fees are generally payable quarterly in advance and calculated based on the ending AUM in the preceding quarter.
LCM’s fees are exclusive of brokerage commissions, wrap program fees, transaction fees, custodial fees, deferred sales charges, exchange fees, SEC fees, transfer taxes, wire transfer, electronic fund fees, and other related costs and expenses which are incurred by the client from custodians, brokers, third-party advisor and other third parties.
Conversation Starter – 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?
Additional Information: 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. Additional information can be found in the LCM Form ADV, Part 2A, which is available on our website http://leeb.net.
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?
Standard of Conduct: When LCM acts 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. Here are some examples to help you understand what this means. For those discretionary accounts for which we also have discretion to select broker-dealers to execute transactions, Form ADV, Part 2A, Item 12 – Brokerage Practices describes the conflict of interest we have with respect to broker- dealers that provide us research and brokerage services. Additionally, because we charge a flat percentage fee based on asset under management, the higher the value of your account, the higher dollar amount in fee we would receive, so there is an incentive for LCM to recommend that you add more assets to your account. You should understand and ask us about these conflicts because they can affect the investment advice we provide you. LCM has adopted a Code of Ethics describing its standards of business conduct, potential conflicts of interest and fiduciary duties. Additionally, Research Chairman Stephen Leeb and Portfolio Manager Kuen (Scott) Chan both write for newsletters published by Capitol Information Group as independent contractors. LCM may trade for its clients in securities that are included in the newsletters. However, despite such policy, LCM is aware of the conflicts of interest that may arise when trading securities for advisory clients that are recommended in the newsletters. LCM will, at all times, strive to act in the best interest of its advisory clients. Please see Form ADV, Part 2A, Item 10 for detailed information.
Additional information: Additional information on conflicts of interest can be found in our Form ADV, Part 2A (Items 7,8,10,11 and 12) which is on our website at www.leeb.net.
How do your financial professionals make money?
LCM personnel are compensated based on a yearly salary or an hourly wage.
Do you or your financial professionals have legal or disciplinary history?
No. LCM has not been subject to any disciplinary events by regulators nor is it a party to any legal events that are material to client evaluation of our advisory business. You can visit Investor.gov/CRS for free and simple search tools to research us and our financial professionals.
Additional Information About LCM
Additional information about us and a copy of this relationship summary are available on the Internet at http://www.leeb.net. If you have any questions about our services or if you wish to request a copy of the relationship summary, please contact Scott Chan at 212-400-2241 or schan@leeb.com. Additional information is also available on the SEC’s website at https://adviserinfo.sec.gov.
Conversation Starter – How might your conflicts of interest affect me, and how will you address them?
Conversation Starter – As a financial professional, do you have any disciplinary history? For what type of conduct?
Conversation Starter – Who is my primary contact person? Is he or she a representative of an investment adviser or broker- dealer? Who can I talk to if I have concerns about how his person is treating me?
