Lincoln Financial Advisors (LFA) offers brokerage account services through National Financial Services LLC® (NFS), a Fidelity® Investments company and clearing firm that is well-known and highly respected across the financial services industry.
LFA fee and commission schedule
You are encouraged to review the LFA Fee and Commission Schedule for detailed information on the trading, execution, and other service fees and charges applicable to your LFA brokerage and investment advisory accounts that are held with NFS and for which LFA serves as the broker-dealer of record. Should you have any questions regarding the LFA Fee and Commission Schedule or the fees that are applicable to your accounts with LFA, please contact your LFA financial professional.
For additional information on the broker-dealer and investment advisory services LFA offers and related fees and expenses, please see LFA’s Form CRS, Regulation Best Interest Disclosure Document, and Form ADV, Part 2A disclosure brochures, as applicable, which are available here.
NFS base lending rate
NFS sets a base lending rate according to commercial lending rates, industry conditions regarding the extension of margin credit and general credit conditions. As of March 1, 2023, the NFS Base Lending Rate (the NFBLR) was 9.25 percent. The NFBLR is set at the discretion of NFS and can change without notice.
Margin trading costs
If you have been approved for a margin borrowing account, you will pay interest on any outstanding margin debit balance in your account. The margin borrowing interest rate is the sum of the NFBLR and a surcharge based on the size of your margin debit balance. You are encouraged to review the NFS Margin Borrowing Brochure and speak with your LFA financial professional before deciding whether margin investing is appropriate for you.
Margin trading entails considerable risk and is not suitable for all investors. If the market value of securities in your margin account declines, you may be required to deposit more money or securities in order to maintain your line of credit. If you are unable to do so, your assets that are pledged as collateral may be sold. Investment losses will not minimize your obligation to repay your margin loan in full.
How LFA addresses debit balances in client accounts
Depending on the type of account you have with LFA and your account’s holdings, LFA may charge you trading, execution, and other service fees and charges as described in the LFA Fee and Commission Schedule linked above when LFA serves as the broker-dealer of record for your account. These fees include, but are not limited to, inactive account fees, annual account maintenance fees, and annual custody and valuation fees for certain asset types, as applicable. If there is not enough cash in your account to pay for these fees as and when they are charged to your account, your account will go into a debit position. To resolve a debit in your account, you may work with your LFA financial professional to deposit additional cash into your account or sell securities held in your account to generate cash. If you do not take prompt action to resolve any debit in your account, LFA will take action to raise cash in your account to satisfy the total amount of your outstanding debit (and any fees and expenses associated with the resolution of your outstanding debit). An outline of the process that LFA uses to resolve outstanding debits in client accounts can be found here.