Help Center

What are the main benefits of opening an investment account?

Investment accounts allow you to take advantage of AlphaClone's research without having to manage, trade and rebalance your account yourself. Simply select one or more of AlphaClone's Core Strategies and we'll do the rest.

What are AlphaClone Core Strategies?

AlphaClone Core Strategies are simply clone portfolios that have been selected by AlphaClone for investors who want to open investment accounts. AlphaClone Core Strategies allow investors to tap the collective intelligence of the world's best fund managers based on their public disclosures. Each "core strategy" holds US equity securities that reflect a specific investment theme such as value investing, activist investing and international investing. Learn more here.

What are your fees for investment accounts?

Your fees are determined by your choice of custodian (see below).

Folio Investments Inc.

Investment account clients who custody at Folio Investments do not pay any trading commissions. Instead they pay an annual fee charged quarterly based on the amount of assets in their account (or across all their accounts if they have more than one account). The table below summarizes fees for clients who custody their assets at Folio.

For amounts
Annual fee (charged quarterly)
First $250,000
1.50%
$250,001 to $500,000
1.35%
$500,001, to $1,000,000
1.15%
More than $1,000,000
1.00%
Minimum annual fee per account
$750.00
Other fees (charged by our Custodian)

Charles Schwab

Investment account clients who custody at Charles Schwab pay both trading commissions and management fees separately. Trading commissions and account servicing fees are determined by Schwab and will vary based on the client's participation and/or investment levels. The table below summarizes our management fees for clients who custody at Schwab.

For amounts
Annual fee (charged quarterly)
First $1 - $25 million
1.00%
$25 - $50 million
0.90%
$50 - $75 million
0.80%
$75 - $100 million
0.70%
Over $100 million
0.60%

How do I open an investment account?

Easy. The entire process is online and it takes about 10 minutes. You can begin here. Once you've completed the online application process, we'll confirm your details, open your account and give you instructions on how to fund your account by wire transfer or check.

Who can open an investment account?

Folio Investments account owners, trustees, and custodians must be U.S. citizens or permanent residents with a valid Social Security number or Taxpayer Identification number. An account owner must have a permanent U.S. address that is not a post office box. Charles Schwab can accommodate account holders from certain foreign jurisdictions, please contact us to inquire.

Are investment accounts suitable for all investors?

No. AlphaClone's investment approach invests in US equities including American Depository Receipts of foreign companies. As such, our investment accounts are for investors seeking moderate to aggressive capital appreciation and are not suited for investors whose primary objective is capital preservation. Our suitability questions at the start of the account opening process will help you determine your suitability.

Do I get online access to my investment accounts?

Once you open and fund your investment account. We'll give you online access to your account(s) 24 hours a day, 7 days a week through your selected custodian's web-based investor portal.

How do I access account statements and reporting?

Through your selected custodian's web-based investor portal, you'll get instant access to online reporting tools, electronic statements, downloadable tax documents and more so you can directly access important information about your accounts. Learn more.

Is there a minimum investment required to open an account?

The minimum investment required to open an account at Folio Investments is $100,000. The minimum investment required to open an account at Charles Schwab is $1,000,000. After that you can transfer funds into your account at any time and in any amount.

What's the best way to set up recurring fund transfers?

After the initial funding, if you're planning to transfer funds to your account at regular intervals, we recommend you transfer funds (by wire or check) no later than 45 days after the end of each quarter (ie. February 15, May 15, August 15 and November 15). AlphaClone's portfolios are updated quarterly roughly fifty days after the end of each calendar quarter so new funds wired into your account will be allocated to your investment choices when updates are made.

Where will my funds be held?

Based on your preference and investment level, your assets will be held either at Folio Investments or at Charles Schwab.

How are my assets (securities and cash) protected at Folio Institutional?

Folio Institutional is a member of the Securities Investor Protection Corporation (SIPC®). As a result, client' assets are protected by SIPC, up to $500,000 in value, including $100,000 in cash awaiting reinvestment. SIPC provides protection for brokerage firms against losses should a SIPC member firm fail financially and become unable to meet obligations of its securities clients. For additional security, Folio Institutional also provides coverage in excess of SIPC limits. In addition, all cash deposits are FDIC insured up to $4.5 million for individual accounts and $9 million for joint accounts. Neither SIPC nor FDIC insurance protect against losses resulting from a decline in the market value of securities. To learn more about how your assets are protected by Folio Institutional, click here.

What types of accounts can I open?

The table below summarizes the different types of accounts you can open with AlphaClone. Please don't hesitate to contact us if you have a question about which type of account is right for you.
Retirement
  • Roth IRA
  • Traditional IRA
  • Rollover IRA
  • SEP-IRA
  • General Investing
  • Individual
  • Joint (multiple)
  • Custodial
  • Trust
  • Business
  • Investment Club
  • For taxable accounts, how are tax lots managed?

    For the first 12 months, there are tax implications due to quarterly rebalancing. After the initial twelve months, AlphaClone pursues a tax lot management strategy that sells shares in the order of largest loss to largest gain. AlphaClone does not give tax advice. Please consult your tax advisor.

    Does AlphaClone vote proxies on behalf of clients?

    No. AlphaClone does not vote proxies on behalf of clients. Clients will receive automatic email notifications regarding upcoming corporate actions and votes relating to securities held in their account.

    How should I decide which AlphaClone Core Strategy(s) to choose?

    AlphaClone is for investors who are comfortable making basic choices regarding their equity investment portfolios. We've provided as much information as possible about how our AlphaClone Core Strategies are constructed, their investing style, their backtested theoretical performance over time and the types of securities they hold. If you still have questions, please don't hesitate to contact us.

    Can I modify the holdings of a core strategy that I'm invested in?

    No. With the exception of any "exclusion" rules the client sets up when they first open the account, a client cannot modify the holdings within each AlphaClone Core Strategy. Please visit the AlphaClone Core Strategies page to understand how each AlphaClone Core Strategy is constructed and its buy/sell rules.

    Can I trade on my own inside an investment account?

    No. An AlphaClone investment account is not a self-directed brokerage account. Our focus is on providing a money management strategy to those investors who want an easy way to follow our investment approach.

    When and how does AlphaClone use risk management tools in an investment account?

    Part of the account opening process involves assessing each client's risk tolerance. Based on that assessment and the core strategies selected by the client, AlphaClone will recommend a risk management program.

    How quickly can I access funds if I need to close my account?

    Your stock positions can be sold at your request. Normally it takes approximately three (3) business days for the trades to settle and for the money to be available. Funds can either be wired to an account that is properly documented in our files or a check can be sent to the address of record for your account.

    Where do I send my funds?

    You can fund your account in one of several ways including check by mail or overnight delivery, one time or recurring electronic funds transfers and wire transfers. Your AlphaClone account representative will give you instructions on how to fund your account based on the option you select.

    Can I transfer an existing IRA account for you to manage?

    Yes.

    Is there anyone at AlphaClone who can help me if I have a question?

    We're always here to help. Drop us a line by email and we'll respond promptly.

    Do you have a free trial?

    We've recently re-designed our service tiers to give members greater and more convenient access to our research. Our Guest Pass is free and now allows members to access a vast majority of our features. Please review our research service Plans and Pricing.

    How do I cancel or upgrade/downgrade my service?

    Simply sign in and click on the "Your Membership" link at the very top of every page. The link takes you to your Member Center where you'll be able to cancel or upgrade/downgrade your membership level and edit your personal and billing information. If you want to cancel a paid membership level, simply downgrade to our Guest Pass level which is free - no need to call or send an email - isn't that refreshing? Your cancellation or upgrade/downgrade is effective immediately and you will receive an email confirming your change.

    What is your refund policy?

    You can cancel a paid plan at any time by accessing the Member Center and downgrading to our free Guest Pass level. Cancellation is effective immediately and you will receive an email confirming your cancellation. NO NEED TO CALL OR EMAIL us requesting cancellation – isn't that refreshing? If you choose to cancel a paid plan you will never be charged again, but you are responsible for charges already incurred for the current billing period. AlphaClone does not prorate for partial periods and all a la carte purchases are final. Please review our Terms of Use for more information.

    Once signed up, how do I get support?

    Simply click on the "Contact US" link found on the top right of every page and send us a message using the form we've provided. We strive to solve all support requests within eight business hours (PT, Pacific Time).

    How do I provide feedback?

    Feel free to email us at contact@alphaclone.com anytime. To report a bug or for technical problems please use the "Customer Support" link found in the help section at the bottom of each page.

    Which browser platforms are supported?

    We are continuously testing on Internet Explorer (v7 & v8) for PC, Firefox (v2 & v3) for both PC and Mac, and Safari (v3 and v4) for Mac. We recommend Firefox 3. We currently do not test on Internet Explorer (v6).

    Do I need to provide my credit card details to access clones?

    No you don't. Guest Pass membership is free and does not require a credit card. Just fill out the short and simple registration form to gain access at that level. When you're ready to view holdings for more clones simply upgrade to Basic or Full membership status in the Member Center and give us your credit card details. It's that easy.

    What is a clone?

    A clone is a portfolio of stocks created based on the stock ideas of one or more fund managers. We backtest all of our clones assuming that investment in those stock ideas is made at the time they are made public - thus giving our users the confidence to apply those stock ideas for themselves. This process is called "cloning".

    Why is cloning valuable?

    Cloning allows investors who might not otherwise qualify to benefit from the stock picking prowess of hedge fund managers. Numerous academic studies have demonstrated the effectiveness of cloning and its potential to consistently outperform. Cloning can also be a powerful way to validate an investor's own stock picks or find new ones.

    How do I know which clones perform best?

    Simple. Our research service allows you to instantly identify the top performing clones across several different time horizons up to ten years. You can view clones by investment theme (ie sector, value, activist, international), and sort by several performance metrics including: total return, annualized return, sharpe ratio, annualized volatility and alpha. Clone performance is updated daily.

    What public filings are used to derive stock holdings?

    The form we aggregate is the 13F-HR form that managers must file with the SEC no later than 45 days after quarter end. We automatically aggregate the public filings of nearly 300 institutional investment managers and hedge funds.

    How are the managers/funds in your database chosen?

    The funds in our database represent roughly 70% or more of the total market value disclosed by all funds that file 13F-HR forms. When creating our fund database, we generally chose the largest institutional funds and hedge funds as measured by the total market value disclosed on their filings. Most of the managers we track are fundamentals driven, value oriented investors. We tend to avoid funds that are owned/operated by prime brokers, those with large ETF businesses, and those with very high turnover.

    What happens if a fund goes out of business?

    If a fund is no longer making filings, clones of that fund will no longer be accessible going forward. However, the historical effect the manager had on clones it impacted remains unchanged and is not purged - this helps us avoid survivorship bias.

    What is a clone strategy?

    You can choose to follow different stock idea attributes from one or a group of managers. For example, following Warren Buffett's largest holdings each quarter is different than following his largest new holdings. AlphaClone currently allows members to clone:
    • Top Holdings (largest positions)
    • Best Ideas (largest new positions)
    • Popularity (largest number of holders - for groups only)
    Each cloning strategy has its own set of buy and sell rules. View our glossary for more information.

    Can I customize a clone?

    Yes, research service members can customize clones across several attributes including:
    • Strategy (top holdings, best ideas, popularity)
    • Number of holdings
    • Long-only or hedged
    • Rebalance method (equal weighted or normalized)
    Members can also generate clones based on a combination of up to 30 funds (a fund group) that they select. All clones (both user-generated and pre-generated) can be customized.

    How often do you rebalance your clones?

    We rebalance (add/delete holdings and reset investment weights) quarterly, 5 business days after the expiration of the SEC's deadline to file form 13F-HR (45 calendar days after each quarter end). You can always find our current and next rebalance dates here.

    Can I employ a hedge in my clone strategy?

    Yes, you can backtest the hedged performance of clone strategies by "shorting" any one of several broad based or sector indexes. AlphaClone performs hedges on its clones assuming that 100% of the clone's invested principal is always in the clone's long positions. Research service subscribers can select from more than one hedging level. For example:
    - $10,000 portfolio, hedged 25%:
  • $10,000 long
  • $2,500 short S&P 500
  • - $10,000 portfolio, hedged 50%:
  • $10,000 long
  • $5,000 short S&P 500
  • - $10,000 portfolio, hedged 75%:
  • $10,000 long
  • $7,500 short S&P 500
  • - $10,000 portfolio, hedged 100%:
  • $10,000 long
  • $10,000 short S&P 500
  • Hedging is meant for illustrative purposes only and results will vary depending on choice of brokerage and products used (ETFs, futures, options). Hedged clones do not adjust for short rebates.

    Do you account for survivorship bias?

    Yes, we account for survivorship bias in two ways. First, we include both active AND inactive securities in our backtest results. Second, we include funds that have gone out of business in our backtest results to preserve the historical effects that fund had on clone performance (see "What happens if a fund no longer files or goes out of business?")

    Do you provide insight into short positions?

    No. manager's who file 13F-HR currently are not required to disclose their short positions.

    What are the limitations of cloning?

    We have gone to great lengths to ensure the quality and timeliness of our data and simulations. However, our clones are restricted to common equity investments that trade on US markets, are publicly disclosed, and for which we have been able to obtain return data.

    Are you affiliated with the funds in your database?

    AlphaClone is in no way affiliated with the investment funds in our database and the service does not attempt to replicate a manager's specific investment approach or strategy.

    % Market Value in Top 10

    This measure tells you what percent of the total market value for all disclosed holdings is represented by the ten largest equity positions.

    % Portfolio

    The percent of a manager's portfolio that is allocated to a particular holding.

    ADRs

    American Depository Receipts or ADRs are stocks of foreign companies that trade on US stock exchanges.

    Alpha

    This is a measure of the risk-adjusted performance of an investment portfolio. Alpha takes the volatility (price risk) of an investment portfolio and compares its risk-adjusted performance to a benchmark index. A positive alpha of 1.0 means the fund has outperformed its benchmark index by 1%. Correspondingly, a similar negative alpha would indicate an underperformance of 1%.

    Annualized Return

    This measure is the geometric mean growth rate of the value of a clone portfolio on an annualized basis. It represents the smoothed annualized gain earned over the investment period. All Annualized Return and Total Return figures are adjusted for stock and cash dividends and for the effects of stock splits.

    Annualized Volatility

    This measure yields the standard deviation of returns for a clone over a specific time period. Typically the higher the annualized volatility, the more risky the investment portfolio.

    Average Turnover

    Average Turnover measures what percent of a portfolio's holdings are new on average over more than one quarter or over more than one fund for the same quarter.

    Best Ideas (Clone Strategy)

    The rules associated with this clone strategy are:
    1. Buy manager(s) top "new buys" as determined by the market value of the holdings.
    2. Limit clone portfolio to no more than 50 holdings selected first on the basis of whether they are a new buy and next based on the % Portfolio of the holding.
    3. Sell when manager(s) reports holding as sell out
    4. Sell if the number of shares held by a manager decreases by 50% or more from the original amount.

    Beta

    Measures the volatility, or systematic risk, of a security or a portfolio as compared to the overall stock market.

    Clone

    A clone is simply a portfolio of stocks created based on the stock ideas of one or more investment manager(s). The clone simulates investing in those stock ideas at the time they are made public thus factoring in the inherent time-delay associated with public filings - a process called "cloning".

    Clone Strategy

    This is the core criteria that is used to select the stocks that make up a clone. Available clone strategies include Top Holding(s), Popularity and Best Ideas.

    Correlation to Index

    Correlation to Index is a statistical measure of how two portfolios change in relation to each other. The measure ranges between -1 and 1, where perfect positive correlation (1) implies that as the performance of one portfolio changes, either up or down, the other security will change in lockstep, in the same direction. Alternatively, perfect negative correlation (-1) means the performance of the two portfolio move in opposite directions by an equal amount. If the measure is 0, the movements of the portfolios are said to have no correlation; they are completely random

    Current Clone Portfolio

    The Current Clone Portfolio table lists a clone's current holdings. You can view the clones past holdings by clicking on the Past Portfolios tab.

    Dynamic Group

    A fund group in which the funds that make up the group change every quarter based on subjective selection criteria (e.g., turnover, market value).

    Equal Weighted

    A portfolio weighting method where the performance of each holding in a clone is given the same weight as any other holding in the clone (e.g., a clone with 10 holdings allocates 10% weight to the performance of each holding). For "Top Holding" and "Best Ideas" clones in a fund group, if there are multiple instances of the same security in a portfolio, we treat each instance as a separate holding. See "Popularity Weighted" to learn how we weight Popularity clones.

    Exchange Traded Fund (ETF)

    A security that tracks a basket of stocks (e.g., S&P 500) or assets (e.g., commodities) just like a mutual fund but trades like a stock (e.g., the price of one share changes and is tradable though out the day).

    Fund Group

    A group of funds from which clones are then generated.

    Hedge Fund

    There is no statutory or regulatory definition of hedge fund, although many have several characteristics in common. Hedge funds are organized by professional investment managers who frequently have a significant stake in the funds they manage and receive a management fee that includes a substantial share of the performance of the fund.

    Hedging

    AlphaClone's clone portfolio can be hedged against downside market risk by shorting any one of several broad based or sector indexes. You can choose from several hedging levels. To learn more about how we hedge our clones please go to our FAQ section on cloning. The link is in the footer below.

    Holdings

    Equity positions disclosed by a fund manager in their public filings. Holdings can also refer to the constituencies within a clone.

    Inactive Security

    An inactive security is one that is no longer listed on the exchange from which it trades. Securities become inactive when the company that issued the security is acquired, taken private, merged or no longer in compliance with the listing requirements of the exchange. AlphaClone includes the effects of inactive securities on the performance of clone portfolios, thus avoiding bias in the results.

    Long Only/Hedged

    This option allows the user to manage a clone's risk profile by allocating a proportion of the clone's returns to the inverse returns of the SP 500 index.

    Market Value

    Refers to the disclosed dollar value of an individual holding within a fund manager's public filing.

    Match the Manager

    A portfolio weighting method where the performance of each holding in a clone is given a weight that is equal to the disclosed market value of that holding at the most recent quarter end divided by the total market value for all holdings in that clone.

    Max Drawdown

    The largest peak-to-trough decline over a specific period for a clone.

    New Buy

    A new holding that was reported by a fund manager for the most recent quarter but did not appear as a holding in the previous quarter.

    Past Portfolios

    The Past Portfolios table lists a clone's holdings over previous quarters. This view allows you to see how a clone's constituencies have changed over the recent past.

    Popularity (Clone Strategy)

    The rules associated with this clone strategy are:
    1. Buy the most popular (widely-held) holdings in a fund group as determined by the number of managers that hold a security in their top 20 holdings (i.e. the more managers that report a security as a holding the more popular it is).
    2. Sell when the holding no longer ranks as being amongst the most popular for that portfolio.
    3. For a holding to be ranked as popular at least two managers in the group must report it as a holding in the same period.

    Popularity Weighted

    A portfolio weighting method where each clone holding is weighted based on how popular the holding is amongst the group. For example, a security which is held by 10 funds will have twice the weight as a security held by 5 funds. This weighting method applies to popularity clones only.

    Public Filings

    To generate clones, AlphaClone uses data contained in historical and current filings submitted by managers in our database to the Securities and Exchange Commission each quarter - specifically we rely on Form 13F.

    Rebalance Date

    The date on which all clone portfolios are updated by adding/deleting holdings based on the most recent public filings. Clones are rebalanced 50 calendar days after the end of each quarter.

    Rebalance Method

    Rebalance methods determine what weight we give to the performance of each holding in a clone at each rebalance date.

    Recent Trades

    The Recent Trades table allow you to view what stocks were sold or bought and at what price at each of the past several rebalance dates for a specific clone.

    Sentiment

    Sentiment measures the aggregate portfolio allocation to a given holding. For example, if 140 out of 326 funds own AAPL with a combined total market value in AAPL of $87.5 billion and the combined market values for all holdings across all 326 funds is $5.162 trillion, AAPL's Sentiment would be ($87.5B/$5162B) x 100,000 or 1694.

    Sellout

    A holding for which a manager has sold out or eliminated their position.

    Sharpe Ratio

    A measure of the excess return (or Risk Premium) per unit of risk in an investment asset or a trading strategy. The higher the Sharpe Ratio the better.

    Single Fund

    Refers to any one of the investment companies or hedge funds being tracked by AlphaClone (e.g., Berkshire Hathaway).

    Static Group

    A fund group in which the funds that make up the group do not change from one quarter to the next.

    Survivorship Bias

    Survivorship bias is the tendency for failed companies or funds to be excluded from performance studies because they no longer exist. It often causes the results of studies to skew higher because only companies which were successful enough to survive until the end of the period are included. AlphaClone avoids survivorship bias by including both currently active and inactive companies in our performance results, and by maintaining a fund's effect on performance results even after it is no longer active.

    Top Holding(s) (Clone Strategy)

    The rules associated with this clone strategy are:
    1. Buys the largest holdings for each manager(s) as determined by the market value of the holdings at the end of the quarter.
    2. Sells when the holding is no longer ranked as being a top holding for that portfolio.

    Total Market Value

    Refers to the aggregate market values for all holdings disclosed by one or more fund manager(s) in a given quarter.

    Total Number of Holdings

    The total number of equity positions reported by a fund manager for a specific quarter (excludes put/calls, and fixed income securities).

    Total Return

    Displayed in percent, Total Return represents the total gain or loss on a clone portfolio over a specific time period. Total Return and Annualized Return figures are adjusted for stock and cash dividends and for the effects of stock splits.

    Turnover

    Turnover measures what percent of a portfolio's holdings are new from one quarter to the next. For a clone, this measures the average turnover over the prior four rebalance periods.

    Review the video demonstration below to see how easy it is to use our online research service to create custom cloning strategies that meet your investment objectives.