Investment in AXP products - Frequently Asked Questions (FAQs)
1. How can I invest? Answer: By giving an order to your bank to purchase our investment product you have chosen using ISIN (will be provided). Your bank will hold our product in custody on your behalf and it will not reduce your assets under management in your bank. Your bank will be getting daily valuations of purchased products.
2. How much should I invest? Answer: While our products are excellent and fully liquid investments, you should prudently invest in this asset class. We generally imply that by investing in our products, you are a wealthy or sophisticated investor who understands the risks, including the risk of total capital loss. The minimum regulatory investment is CHF 100,000 equivalent; however, we typically accept investments not below USD 300,000. This should be part of liquid assets you can afford to lose.
3. How long should I stay invested? Answer: Our products are for medium- to long-term investors. Although there is no hard lock-up period, we recommend an average investment holding period of 3 to 5 years.
4. What level of return can I expect from AXP products? Answer: The historical average annual return of the AXP reference portfolio is around 25% after costs. While past performance is not indicative of future results, mid- to long-term investors can reasonably expect returns in this range.
5. In which currency can I invest? Answer: Most of our products are denominated in USD but if you want to invest in a different currency, please get in touch with us at info@axpadvisors.com and we can offer a hedging solution (extra hedging costs may be involved)
6. Can I invest outside of Switzerland? Answer: Generally, any bank with access to the Swiss market can facilitate investment. However, local regulatory restrictions may apply. Contact AXP at info@axpadvisors.com for assistance in finding a suitable solution.
7. How can I see where my assets are invested? Answer: Via an online tool (will be available shortly) or by request through email.
8. Why is investing in AXP products better than in a low-cost ETF or fund? Answer: Due to the ability to actively manage market volatility.
9. How can I be sure my funds are safe? Answer: The custodian of the underlying assets is Interactive Brokers, one of the largest and most reputable brokers globally. Your bank acts as the custodian of the AMC(Actively Managed Certificate), which is issued under Swiss law. The paying agent is Kaiser Partner Private Bank, a reputable financial institution. AXP Advisors have no access to funds, only access to manage them on the Interactive Brokers account.
10. What happens if the bank holding AXP product in custody for me is in trouble? Answer: AXP products are off-balance financial instruments, so they will be segregated from the bank’s liquidation balance (DFP) and can be moved to a different financial institution. AXP can assist in finding alternatives.
11. How can I have some liquidity if the product performs well? Answer: You can redeem through the standard redemption mechanism either fully or partially.
12. How are the fees calculated? Answer: The performance fee is calculated daily with a High Water Mark implemented on the actual profit net of management fee.
13. Can I invest through my operational company, trust, or foundation account? Answer: Yes, as long as your bank has acces to the Swiss market and the entity account have the correct classification. If there is an issue, contact AXP at info@axpadvisors.com for assistance in finding a suitable solution.
14. Where can I find the terms and conditions of the product I intend to invest? Answer: In the Term Sheet which will be provided by request
15. What risk mechanisms are embodied in AXP products? Answer: monitoring trends, adjusting portfolios, hedging, and using derivatives to protect against market declines, interest rate changes, and currency fluctuations.
16. Are there any taxes? Answer: There are no taxes on the level of our investment products. The taxes after the redemption of our product will be based on your tax residence.
17. Is there a reference real-life portfolio? Answer: Yes
18. How quickly can I receive redemptions? Answer: We have daily liquidity with funds typically received by investor T+2 after the investor’s bank submits a sell order.
19. Where can I find additional information about AXP? Answer: You can find general information on our website www.axpadvisors.com and if you have any questions, you can contact us at info@axpadvisors.com
20. How can I get more insight into AXP strategy (e.g., investor letters, calls)? Answer: We are distributing regular newsletters to investors and also, investors can participate in our periodic investment conference calls.
21. Can you explain the redemption mechanism in detail? Answer: Investors must notify their intention to redeem before 5:00 AM UTC on any given trading day via email at redemptions@axpadvisors.com
Valuation Basis
Once the notification is received, the redemption will be valued using the
official Net Asset Value (NAV) of that same day, calculated after markets
close (typically available shortly after 5:00 AM UTC the following morning).
Confirmation
After receiving the NAV, the investor (via their bank) must confirm the
redemption within a short time window, typically by [e.g. 10:00 AM UTC on
the same day the NAV is released], to proceed with execution.
Final Execution
Only upon confirmation will the redemption be processed. If no
confirmation is received within the specified window, the redemption will
not be executed, and a new request will be required.
Settlement
Proceeds are settled typically within T+2 business days following the
valuation day.
22. What happens if I just instruct my bank to sell shares in AXP products? Answer: The bank contacts the paying agent. The sell order is processed at the next NAV date (e.g., Wednesday). The sale price will reflect the NAV at that time multiplied by the number of shares sold. You won’t know the exact price until you receive the funds.
23. What is the legal framework of AXP products? Answer: Governed by Swiss obligations law and the product term sheet.
24. Which asset classes does AXP use? Answer: Highly liquid US equities, ETF’s, commodities, crypto, and derivatives, including options and futures, in both long and short positions.
25. How liquid are the positions in AXP products? Answer: Highly liquid; AXP’s trades do not affect price movements.
26. Is there any leverage used? Answer: we can use leverage from time to time, mostly when training futures, but very low margin-to-equity ratio.
27. Does AXP use stop losses? Answer: Rarely, and mostly dynamically. The portfolio is mostly hedged with derivatives to minimize losses during flash crashes or extreme volatility.
28. Does AXP use compliance for client onboarding? Answer: Normally not; this is the function of the bank.
29. Can I become an introducer for AXP? Answer: Yes, contact us at info@axpadvisors.com
30. Which financial institutions are involved in DASA? Answer: Interactive Brokers (custodian of assets), Kaiser Partner Privatebank (as paying agent)
31. Do I have counterparty risk in AXP products? Answer: Your counterparty risk is risk in Interactive Brokers (one of the world’s largest and most reputable brokerages)
32. Can I influence the investment strategy of AXP? Answer: No.
33. Why invest in AXP products today? Answer: Due to increased volatility, economic uncertainty (e.g., Trump-era effects), and market opportunities.