Mainstreet Investment Advisors, Llc
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MAINSTREET INVESTMENT ADVISORS, LLC DISCLOSURE BROCHURE— PART 2A OF FORM ADV March 29, 2021 120 NORTH LASALLE, SUITE 3300 CHICAGO, IL 60602 P 312.223.0270 F 312.223.0276 WWW.MAINSTREETADV.COM [email protected] THIS BROCHURE PROVIDES INFORMATION ABOUT THE QUALIFICATIONS AND BUSINESS PRACTICES OF MAINSTREET INVESTMENT ADVISORS, LLC. IF YOU HAVE ANY QUESTIONS ABOUT THE CONTENTS OF THIS BROCHURE, PLEASE CONTACT US BY PHONE AT 312.223.0270 OR BY EMAIL AT [email protected]. THE INFORMATION IN THIS BROCHURE HAS NOT BEEN APPROVED OR VERIFIED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION (SEC) OR BY ANY STATE SECURITIES AUTHORITY. MAINSTREET INVESTMENT ADVISORS, LLC IS A REGISTERED INVESTMENT ADVISER. REGISTRATION AS AN INVESTMENT ADVISER DOES NOT IMPLY ANY LEVEL OF SKILL OR TRAINING. THE ORAL AND WRITTEN COMMUNICATIONS OF AN ADVISER PROVIDE YOU WITH INFORMATION WHICH YOU CAN USE TO DETERMINE WHETHER TO HIRE OR RETAIN AN ADVISER. ADDITIONAL INFORMATION ABOUT MAINSTREET INVESTMENT ADVISORS, LLC IS AVAILABLE ON THE SEC’S WEBSITE AT WWW.ADVISERINFO.SEC.GOV. ITEM 2: MATERIAL CHANGES ANNUAL UPDATE The Material Changes of this brochure will be updated annually or as frequently as needed. Please review both Form ADV Parts 1 and 2. MATERIAL CHANGES SINCE THE LAST UPDATE Set forth below are the material changes to MainStreet Investment Advisors, LLC Firm Brochure that occurred since the March 26, 2020 annual update: Item 4 was updated to note the discontinuation of MainStreet Marketing Tools, to reflect the addition of a branch office in Grand Rapids, Michigan and closure of the branch office in Shelton, Connecticut. Also, in this Item, changes were made to reflect the name change to Sustainable Leaders Portfolio and Strategies (previously Responsible Leaders). Item 5 was updated to remove the fee schedule for Non-Discretionary Management Utilizing the Black Diamond Platform. Additionally, the Minimum Fees and Minimum Account Sizes were adjusted for the Traditional Fixed Income Asset Management Strategies. Item 8 was updated to include additional potential investment risks and add disclosure regarding responsibilities of dual employees of MainStreet and Fifth Third Bank, National Association. Item 10 was updated to remove reference to the MainStreet Marketing Tools service. Also, H2C Securities, Inc. was added as an affiliated entity. Due to the sale by Fifth Third, R.G. McGraw Insurance Agency, Inc. and Epic Insurance Solutions Agency, LLC were removed as affiliated entities. Item 12 was updated to clarify that MainStreet is prohibited from participating in any offerings in which an affiliated entity is part of the syndicate until those securities are available in the secondary market. Additional information about MainStreet Investment Advisors, LLC is also available via the SEC’s web site www.adviserinfo.sec.gov. The SEC’s web site also provides information about persons affiliated with MainStreet who are registered, or are required to be registered, as investment adviser representatives of MainStreet. 2 ITEM 3: TABLE OF CONTENTS ITEM 2: MATERIAL CHANGES ........................................................................................................................................ 2 Annual Update .......................................................................................................................................................... 2 Material Changes Since the Last Update ................................................................................................................. 2 ITEM 3: TABLE OF CONTENTS ...................................................................................................................................... 3 ITEM 4: ADVISORY BUSINESS ....................................................................................................................................... 5 Firm Description ........................................................................................................................................................ 5 Principal Owners ....................................................................................................................................................... 5 Categories of Advisory Services ............................................................................................................................... 5 Fiduciary Services ..................................................................................................................................................... 5 Separate Account Management (SAM) .................................................................................................................... 7 Fund Allocation Portfolios (FAP) ............................................................................................................................... 7 Automated Portfolio Solution (APS) .......................................................................................................................... 7 Retirement Plan Solutions (RPS) .............................................................................................................................. 7 Traditional Fixed Income Asset Management........................................................................................................... 8 Advisory Services ...................................................................................................................................................... 8 Total Assets Under Management and Advisement .................................................................................................. 8 Termination ............................................................................................................................................................... 9 ITEM 5: FEES AND COMPENSATION ............................................................................................................................ 9 Description ................................................................................................................................................................ 9 Negotiability of Fees And Minimum Account Size .................................................................................................. 10 Fee Billing ............................................................................................................................................................... 10 Institutional Advisory Services Fee Schedules ....................................................................................................... 10 Traditional Fixed Income And Equity SRI Asset Management Fee Schedules ...................................................... 11 Individual Advisory Services Fee Schedule ............................................................................................................ 12 Investment Advisers’ Advisory Services Fee Schedule .......................................................................................... 12 Other Fees and Charges......................................................................................................................................... 12 Fund Fees and Expenses ....................................................................................................................................... 12 Fees and Commissions for Custodial and Brokerage Services.............................................................................. 13 ITEM 6: PERFORMANCE-BASED FEES AND SIDE-BY-SIDE MANAGEMENT .......................................................... 13 Performance-Based Fees/Sharing of Capital Gains ............................................................................................... 13 Side-By-Side Management ..................................................................................................................................... 14 ITEM 7: TYPES OF CLIENTS ......................................................................................................................................... 14 Types of Clients ...................................................................................................................................................... 14 Minimum Account Size............................................................................................................................................ 14 ITEM 8: METHODS OF ANALYSIS, INVESTMENT STRATEGIES, AND RISK OF LOSS ........................................... 14 Methods of Analysis ................................................................................................................................................ 14 Types of Investments .............................................................................................................................................. 18 Risk of Loss ............................................................................................................................................................. 18 Allocation of Investment Opportunities ................................................................................................................... 20 ITEM 9: DISCIPLINARY INFORMATION ....................................................................................................................... 20 Legal and Disciplinary ............................................................................................................................................