Everman Prosperity LLC
8647 Oak Chase Circle
Fairfax Station, VA 22039
571-244-1802
Form ADV Part 2A – Firm Brochure
Dated: January 19, 2024
This Brochure provides information about the qualifications and business practices of Everman Prosperity LLC. If you have any questions about the contents of this Brochure, please contact us at 571-244-1802. The information in this Brochure has not been approved or verified by the United States Securities and Exchange Commission or by any state securities authority.
Everman Prosperity LLC is a registered investment adviser. Registration does not imply a certain level of skill or training.
Additional information about Everman Prosperity LLC also is available on the SEC’s website at www.adviserinfo.sec.gov, which can be found using the firm’s identification number, 329528.
Item 2: Material Changes
Since this is the first filing of the Form ADV Part 2A for Everman Prosperity LLC, there is nothing to report. In the future, any material changes made during the year will be reported here.
Item 3: Table of Contents
Item 1: Cover Page
Item 2: Material Changes
Item 3: Table of Contents
Item 4: Advisory Business
Item 5: Fees and Compensation
Item 6: Performance-Based Fees and Side-By-Side Management
Item 7: Types of Clients
Item 8: Methods of Analysis, Investment Strategies, and Risk of Loss
Item 9: Disciplinary Information
Item 10: Other Financial Industry Activities and Affiliations
Item 11: Code of Ethics, Participation or Interest in Client Transactions and Personal Trading
Item 12: Brokerage Practices
Item 13: Review of Accounts
Item 14: Client Referrals and Other Compensation
Item 15: Custody
Item 16: Investment Discretion
Item 17: Voting Client Securities
Item 18: Financial Information
Item 19: Requirements for State-Registered Advisers
Form ADV Part 2B – Brochure Supplement
Item 4: Advisory Business
Description of Advisory Firm
Everman Prosperity LLC is an Investment Adviser principally located in the state of Virginia. We are a limited liability company founded on November 18, 2022. Everman Prosperity LLC became registered in 2024. Robert Moore is the principal owner and Chief Compliance Officer (“CCO”).
As used in this brochure, the words “EP”, "we", "our firm", “Advisor” and "us" refer to Everman Prosperity LLC and the words "you", "your" and "Client" refer to you as either a client or prospective client of our firm.
Types of Advisory Services
EP is a fee-only firm, meaning the only compensation we receive is from our Clients for our services. We offer Investment Management and Financial Planning. From time to time, EP recommends third-party professionals such as attorneys, accountants, tax advisors, insurance agents, or other financial professionals. Clients are never obligated to utilize any third-party professional we recommend. EP is not affiliated with nor does EP receive any compensation from third-party professionals we may recommend.
Investment Management Services
Our firm provides continuous advice to a Client regarding the investment of Client funds based on the individual needs of the Client. Through personal discussions in which goals and objectives based on a Client's particular circumstances are established, we develop a Client's personal investment policy or an investment plan with an asset allocation target and create and manage a portfolio based on that policy and allocation targets. We will also review and discuss a Client’s prior investment history, as well as family composition and background. Account supervision is guided by the stated objectives of the Client (e.g., maximum capital appreciation, growth, income, or growth, and income), as well as risk tolerance and tax considerations.
We primarily advise our Clients regarding investments in stocks, bonds, mutual funds, ETFs, U.S. government and municipal securities, and cash and cash equivalents. We may also provide advice regarding investments held in Client’s portfolio at the inception of our advisory relationship and/or other investment types not listed above, at the Client’s request.
When we provide investment management services, Clients grant us limited authority to buy and sell securities on a discretionary basis. More information on our trading authority is explained in Item 16 of this Brochure. Clients may impose reasonable restrictions on investing in certain securities, types of securities, or industry sectors.
Financial Planning Services
Financial planning involves an evaluation of a Client's current and future financial state by using currently known variables to predict future cash flows, asset values, and withdrawal plans. The key defining aspect of financial planning is that through the financial planning process, all questions, information, and analysis will be considered as they affect and are affected by the entire financial and life situation of the Client. Clients purchasing this service will receive a written report, providing the Client with a detailed financial plan designed to help achieve the Client’s stated financial goals and objectives.
In general, the financial plan will address some or all of the following areas of concern. The Client and EP will work together to select specific areas to cover. These areas may include, but are not limited to, the following:
Business Planning: We provide consulting services for Clients who currently operate their own business, are considering starting a business, or are planning for an exit from their current business. Under this type of engagement, we work with you to assess your current situation, identify your objectives, and develop a plan aimed at achieving your goals.
Cash Flow and Debt Management: We will conduct a review of your income and expenses to determine your current surplus or deficit along with advice on prioritizing how any surplus should be used or how to reduce expenses if they exceed your income. Advice may also be provided on which debts to pay off first based on factors such as the interest rate of the debt and any income tax ramifications. We may also recommend what we believe to be an appropriate cash reserve that should be considered for emergencies and other financial goals, along with a review of accounts (such as money market funds) for such reserves, plus strategies to save desired amounts.
College Savings: Includes projecting the amount that will be needed to achieve college or other post-secondary education funding goals, along with advice on ways for you to save the desired amount. Recommendations as to savings strategies are included, and, if needed, we will review your financial picture as it relates to eligibility for financial aid or the best way to contribute to children and grandchildren (if appropriate).
Employee Benefits Optimization: We will provide review and analysis as to whether you, as an employee, are taking the maximum advantage possible of your employee benefits. If you are a business owner, we will consider and/or recommend the various benefit programs that can be structured to meet both business and personal retirement goals.
Estate Planning: This usually includes an analysis of your exposure to estate taxes and your current estate plan, which may include whether you have a will, powers of attorney, trusts, and other related documents. Our advice also typically includes ways for you to minimize or avoid future estate taxes by implementing appropriate estate planning strategies such as the use of applicable trusts. We always recommend that you consult with a qualified attorney when you initiate, update, or complete estate planning activities. We may provide you with contact information for attorneys who specialize in estate planning when you wish to hire an attorney for such purposes. From time-to-time, we will participate in meetings or phone calls between you and your attorney with your approval or request.
Financial Goals: We will help Clients identify financial goals and develop a plan to reach them. We will identify what you plan to accomplish, what resources you will need to make it happen, how much time you will need to reach the goal, and how much you should budget for your goal.
Insurance: Review of existing policies to ensure proper coverage for life, health, disability, long-term care, liability, home, and automobile.
Investment Analysis: This may involve developing an asset allocation strategy to meet Clients’ financial goals and risk tolerance, providing information on investment vehicles and strategies, reviewing employee stock options, as well as assisting you in establishing your own investment account at a selected broker/dealer or custodian. The strategies and types of investments we may recommend are further discussed in Item 8 of this brochure.
Retirement Planning: Our retirement planning services typically include projections of your likelihood of achieving your financial goals, typically focusing on financial independence as the primary objective. For situations where projections show less than the desired results, we may make recommendations, including those that may impact the original projections by adjusting certain variables (e.g., working longer, saving more, spending less, taking more risk with investments).
If you are near retirement or already retired, advice may be given on appropriate distribution strategies to minimize the likelihood of running out of money or having to adversely alter spending during your retirement years.Risk Management: A risk management review includes an analysis of your exposure to major risks that could have a significant adverse impact on your financial picture, such as premature death, disability, property and casualty losses, or the need for long-term care planning. Advice may be provided on ways to minimize such risks and about weighing the costs of purchasing insurance versus the benefits of doing so and, likewise, the potential cost of not purchasing insurance (“self-insuring”).
Tax Planning Strategies: Advice may include ways to minimize current and future income taxes as a part of your overall financial planning picture. For example, we may make recommendations on which type of account(s) or specific investments should be owned based in part on their “tax efficiency,” with the consideration that there is always a possibility of future changes to federal, state or local tax laws and rates that may impact your situation.
We recommend that you consult with a qualified tax professional before initiating any tax planning strategy, and we may provide you with contact information for accountants or attorneys who specialize in this area if you wish to hire someone for such purposes. We will participate in meetings or phone calls between you and your tax professional with your approval.
Financial Planning Services are offered on a Project-Based and via an Ongoing engagement.
Ongoing Financial Planning. This service involves working one-on-one with a financial planner (“planner”) over an extended period of time. Through this ongoing arrangement, Clients are expected to collaborate with the planner to develop and assist in the implementation of their financial plan (the “plan”). The planner will monitor the plan, recommend any appropriate changes and ensure the plan is up-to-date as the Client’s situation, goals, and objectives evolve.
Upon engaging the firm for financial planning, EP is responsible for obtaining and analyzing all necessary qualitative and quantitative information from the Client that is essential to understanding the Client’s personal and financial circumstances; helping the Client identify, select, and prioritize certain financial goals while understanding the effect that pursuing one goal may have on other potential goals; assessing the Client’s current course of action and alternative courses of action to identify required changes that provide the best opportunity for the client to meet their financial goals; developing & presenting financial planning recommendations based on the aforementioned actions while including all information that was required to be considered in preparing the recommendations; and ongoing monitoring of the Client’s progress toward the goals and objectives that the recommendations are based around. These components all require in-depth communication with the Client in order for the planner to establish a financial plan and implementation strategy that provides the Client with the most appropriate options in pursuing their established goals and objectives.
Project-Based Financial Planning. We provide project-based financial planning services on a limited scope one-time engagement. Project-Based Financial Planning is available for Clients looking to address specific questions or issues. The Client may choose from one or more of the above topics to cover or other areas as requested and agreed to by EP. For Project-Based Financial Planning, the Client will be ultimately responsible for the implementation of the financial plan.
Client Tailored Services and Client Imposed Restrictions
We tailor the delivery of our services to meet the individual needs of our Clients. We consult with Clients initially and on an ongoing basis, through the duration of their engagement with us, to determine risk tolerance, time horizon and other factors that may impact the Clients’ investment and/or planning needs.
Clients are able to specify, within reason, any restrictions they would like to place as it pertains to individual securities and/or sectors that will be traded in their account All such requests must be provided to EP in writing. EP will notify Clients if they are unable to accommodate any requests.
Wrap Fee Programs
We do not participate in wrap fee programs.
Assets Under Management
As of December 13, 2023, EP has $0 in discretionary and $0 in non-discretionary assets under management.
Item 5: Fees and Compensation
Please note, unless a Client has received this brochure at least 48 hours prior to signing an Advisory Contract, the Advisory Contract may be terminated by the Client within five (5) business days of signing the Advisory Contract without penalty.
How we are paid depends on the type of advisory services we perform. Below is a brief description of our fees, however, you should review your executed Advisory Contract for more detailed information regarding the exact fees you will be paying. No increase to the agreed-upon advisory fees outlined in the Advisory Contract shall occur without prior Client consent.
Investment Management Services
The fee for EP’s Investment management services is 1.00% of the value of assets under management and may be negotiable. The annual advisory fee is paid quarterly in arrears based on the value of Client’s account(s) as of the last day of the billing period. Our minimum annual fee for Investment Management services is $2,750.
In determining the advisory fee, we may allow accounts of members of the same household to be aggregated. EP relies on the valuation as provided by Client’s custodian in determining assets under management. Our advisory fee is prorated for any partial billing periods occurring during the engagement, including the initial and terminating billing periods. Clients may make additions or withdrawals from their account at any time; however, EP reserves the right to adjust our advisory fees on a pro-rata basis on account of any such cash-flow transactions.
Ongoing Financial Planning
We charge a recurring fixed fee for Ongoing Financial Planning starting at $1,080 per quarter. Fees are paid quarterly in arrears. The fee range is dependent upon variables including the specific needs of the Client, complexity, estimated time, research, and resources required to provide services to you, among other factors we deem relevant. Fees are negotiable and the final agreed upon fee will be outlined in your Advisory Contract.
Project-Based Financial Planning
EP charges either a fixed or hourly fee for Project-Based Financial Planning. Fixed fee rates range between $1,770 to $4,470. Our hourly rate is $320.
The fee range is dependent upon variables including the specific needs of the Client, complexity, estimated time, research, and resources required to provide services to you, among other factors we deem relevant. Fees are negotiable and the final agreed upon fee will be outlined in your Advisory Contract. EP may request a portion of the fee be collected in advance with the remainder due upon completion of the services. EP will not bill an amount above $500 more than 6 months or more in advance of rendering the services.
Fee Payment
For Investment Management services, we deduct our advisory fee from one or more account(s) held at an unaffiliated third-party custodian, as directed by the Client. Please refer to Item 15 of this Brochure regarding our policy on direct fee deduction. Clients may also pay by electronic funds transfer (EFT). We use an independent third party payment processor in which the Client can securely input their banking information and pay their fee. We do not have access to the Client’s banking information at any time. The Client will be provided with their own secure portal in order to make payments.
For Financial Planning services, fees are paid by electronic funds transfer (EFT). We use an independent third party payment processor in which the Client can securely input their banking information and pay their fee. We do not have access to the Client’s banking information at any time. The Client will be provided with their own secure portal in order to make payments.
Other Types of Fees and Expenses
Our fees are exclusive of brokerage commissions, transaction fees, and other related costs and expenses which may be incurred by the Client. Clients may incur certain charges imposed by custodians, brokers, and other third parties such as custodial fees, deferred sales charges, odd-lot differentials, transfer taxes, wire transfer, and electronic fund fees, and other fees and taxes on brokerage accounts and securities transactions. Mutual fund and exchange-traded funds also charge internal management fees, which are disclosed in a fund's prospectus. Such charges, fees, and commissions are exclusive of and in addition to our fee, and we shall not receive any portion of these commissions, fees, and costs.
Item 12 further describes the factors that we consider in selecting or recommending custodians for Client’s transactions and determining the reasonableness of their compensation (e.g., commissions).
Clients may incur fees from third-party professionals such as accountants and attorneys that EP may recommend, upon Client request. Such fees are separate and distinct from EP’s advisory fees.
Terminations and Refunds
For Investment Management services the Advisory Contract may be terminated with written notice at least 30 calendar days in advance. Since fees are paid in arrears, no refund will be needed upon termination of the Advisory Contract. Clients will be responsible for payment of fees up to the date of termination.
For Ongoing Financial Planning services, the Advisory Contract may be terminated with written notice at least 30 calendar days in advance. Since fees are paid in arrears, no refund will be needed upon termination of the Advisory Contract. Clients will be responsible for payment of fees up to the date of termination, based on the percentage of work completed by the Advisor.
For Project-Based Financial Planning services, this service is not an ongoing engagement, thus upon receipt of the final fees, the Advisory Contract will automatically be terminated. Clients may terminate at any time provided written notice. If fees are paid in advance, a prorated refund will be given, if applicable, upon termination of the Advisory Contract for any unearned fee. For fees paid in arrears, Client shall be charged a pro-rata fee based upon the percentage of the work done up to the date of termination.
Sale of Securities or Other Investment Products
Advisor and its supervised persons do not accept compensation for the sale of securities or other investment products including asset-based sales charges or service fees from the sale of mutual funds.
Item 6: Performance-Based Fees and Side-By-Side Management
We do not offer performance-based fees and do not engage in side-by-side management.
Item 7: Types of Clients
We provide financial planning and investment management services to individuals and high net-worth individuals.
We do not have a minimum account size requirement.
Item 8: Methods of Analysis, Investment Strategies, and Risk of Loss
Below is a brief description of our methods of analysis and primary investment strategies
Methods of Analysis
Fundamental analysis involves analyzing individual companies and their industry groups, such as a company’s financial statements, details regarding the company’s product line, the experience, and expertise of the company’s management, and the outlook for the company’s industry. The resulting data is used to measure the true value of the company’s stock compared to the current market value. The risk of fundamental analysis is that the information obtained may be incorrect and the analysis may not provide an accurate estimate of earnings, which may be the basis for a stock’s value. If securities prices adjust rapidly to new information, utilizing fundamental analysis may not result in favorable performance.
Cyclical analysis is a type of technical analysis that involves evaluating recurring price patterns and trends based upon business cycles. Economic/business cycles may not be predictable and may have many fluctuations between long-term expansions and contractions. The lengths of economic cycles may be difficult to predict with accuracy and therefore the risk of cyclical analysis is the difficulty in predicting economic trends and consequently the changing value of securities that would be affected by these changing trends.
Modern Portfolio Theory (MPT)
The underlying principles of MPT are:
Investors are risk averse. The only acceptable risk is that which is adequately compensated by an expected return. Risk and investment return are related and an increase in risk requires an increased expected return.
Markets are efficient. The same market information is available to all investors at the same time. The market prices every security fairly based upon this equal availability of information.
The design of the portfolio as a whole is more important than the selection of any particular security. The appropriate allocation of capital among asset classes will have far more influence on long-term portfolio performance than the selection of individual securities.
Investing for the long-term (preferably longer than ten years) becomes critical to investment success because it allows the long-term characteristics of the asset classes to surface.
Increasing diversification of the portfolio with lower correlated asset class positions can decrease portfolio risk. Correlation is the statistical term for the extent to which two asset classes move in tandem or opposition to one another.
Mutual Fund and/or ETF Analysis: We look at the experience and track record of the manager of the mutual fund or ETF in an attempt to determine if that manager has demonstrated an ability to invest over a period of time and in different economic conditions. We also look at the underlying assets in a mutual fund or ETF in an attempt to determine if there is significant overlap in the underlying investments held in other funds in the Client’s portfolio. In addition, we monitor the funds or ETFs in an attempt to determine if they are continuing to follow their stated investment strategy.
A risk of mutual fund and/or ETF analysis is that, as in all securities investments, past performance does not guarantee future results. A manager who has been successful may not be able to replicate that success in the future. In addition, as we do not control the underlying investments in a fund or ETF, managers of different funds held by the client may purchase the same security, increasing the risk to the client if that security were to fall in value. There is also a risk that a manager may deviate from the stated investment mandate or strategy of the fund or ETF, which could make the fund or ETF less suitable for the Client’s portfolio.
Investment Strategies
Asset Allocation
In implementing our Clients’ investment strategy, we begin by attempting to identify an appropriate ratio of equities, fixed income, and cash (i.e. “asset allocation”) suitable to the Client’s investment goals and risk tolerance.
A risk of asset allocation is that the Client may not participate in sharp increases in a particular security, industry or market sector. Another risk is that the ratio of equities, fixed income, and cash will change over time due to stock and market movements and, if not corrected, will no longer be appropriate for the Client’s goals. We attempt to closely monitor our asset allocation models and make changes periodically to keep in line with the target risk tolerance model.
Passive Investment Management
Passive investing involves building portfolios that are composed of various distinct asset classes. The asset classes are weighted in a manner to achieve the desired relationship between correlation, risk, and return. Funds that passively capture the returns of the desired asset classes are placed in the portfolio. The funds that are used to build passive portfolios are typically index mutual funds or exchange-traded funds.
Passive investment management is characterized by low portfolio expenses (i.e. the funds inside the portfolio have low internal costs), minimal trading costs (due to infrequent trading activity), and relative tax efficiency (because the funds inside the portfolio are tax efficient and turnover inside the portfolio is minimal).
In contrast, active management involves a single manager or managers who employ some method, strategy or technique to construct a portfolio that is intended to generate returns that are greater than the broader market or a designated benchmark.
Socially Responsible Investing
We may utilize various socially conscious investment approaches if a Client desires. EP may construct portfolios that utilize mutual funds, ETFs, or individual securities with the purpose of incorporating socially conscious principles into a Client’s portfolio. These portfolios may sometimes also be customized to reflect the personal values of each individual, family, or organization. This allows our Clients to invest in a way that aligns with their values. EP may rely on mutual funds and ETFs that incorporate Environmental, Social and Governance (“ESG”) research as well as positive and negative screens related to specific business practices to determine the quality of an investment on values-based merits. Additionally, EP may construct portfolios of individual securities in order to provide Clients with a greater degree of control over the socially conscious strategies they are utilizing. EP relies on third-party research when constructing portfolios of individual securities with socially conscious considerations.
If you request your portfolio to be invested according to socially conscious principles, you should note that returns on investments of this type may be limited and because of this limitation you may not be able to be as well diversified among various asset classes. The number of publicly traded companies that meet socially conscious investment parameters is also limited, and due to this limitation, there is a probability of similarity or overlap of holdings, especially among socially conscious mutual funds or ETFs. Therefore, there could be a more pronounced positive or negative impact on a socially conscious portfolio, which could be more volatile than a fully diversified portfolio.
Long-term/Short-term purchases
We purchase securities and generally hold them in the Client's account for a year or longer. Short-term purchases may be employed as appropriate when:
We believe the securities to be currently undervalued, and/or
We want exposure to a particular asset class over time, regardless of the current projection for this class.
A risk in a long-term purchase strategy is that by holding the security for this length of time, we may not take advantage of short-term gains that could be profitable to a client. Moreover, if our predictions are incorrect, a security may decline sharply in value before we make the decision to sell.
Material Risks Involved
All investing strategies we offer involve risk and may result in a loss of your original investment which you should be prepared to bear. Many of these risks apply equally to stocks, bonds, commodities, and any other investment or security. Material risks associated with our investment strategies are listed below.
Market Risk: Market risk involves the possibility that an investment’s current market value will fall because of a general market decline, reducing the value of the investment regardless of the operational success of the issuer’s operations or its financial condition.
Strategy Risk: The Adviser’s investment strategies and/or investment techniques may not work as intended.
Small and Medium Cap Company Risk: Securities of companies with small and medium market capitalizations are often more volatile and less liquid than investments in larger companies. Small and medium cap companies may face a greater risk of business failure, which could increase the volatility of the Client’s portfolio.
Turnover Risk: Actively managed mutual funds tend to have a higher turnover rate than passive funds. A high portfolio turnover would result in higher transaction costs and in higher taxes when shares are held in a taxable account. These factors may negatively affect the account’s performance.
Limited markets: Certain securities may be less liquid (harder to sell or buy) and their prices may at times be more volatile than at other times. Under certain market conditions, we may be unable to sell or liquidate investments at prices we consider reasonable or favorable or find buyers at any price.
Interest Rate Risk: Bond (fixed income) prices generally fall when interest rates rise, and the value may fall below par value or the principal investment. The opposite is also generally true: bond prices generally rise when interest rates fall. In general, fixed income securities with longer maturities are more sensitive to these price changes. Most other investments are also sensitive to the level and direction of interest rates.
Legal or Legislative Risk: Legislative changes or Court rulings may impact the value of investments, or the securities’ claim on the issuer’s assets and finances.
Inflation: Inflation may erode the buying power of your investment portfolio, even if the dollar value of your investments remains the same.
Risks Associated with Securities
Apart from the general risks outlined above which apply to all types of investments, specific securities may have other risks.
Modern Portfolio Theory (MPT) is built on the idea that an investment portfolio can be created to maximize expected return while aligning with a given level of acceptable risk. While the aim of MPT is to remain within acceptable risk levels, it is susceptible to all risks associated with the securities contained within the portfolio. This primarily includes systematic and unsystematic risks along with any or all risks listed for securities below.
Passive Investment Management is the practice of investing using broad sectors or securities indexes and holding over long time periods. By design, primary risk associated with passive Investment is systematic (market) risk. While passive investing is created to minimize shorter term and unsystematic risks, it is susceptible to any and all risks associated with securities contained in the chosen indexes and listed below.
Bank Obligations including bonds and certificates of deposit may be vulnerable to setbacks or panics in the banking industry. Banks and other financial institutions are greatly affected by interest rates and may be adversely affected by downturns in the U.S. and foreign economies or changes in banking regulations.
Commercial Paper is, in most cases, an unsecured promissory note that is issued with a maturity of 270 days or less. Being unsecured the risk to the investor is that the issuer may default.
Common stocks may go up and down in price quite dramatically, and in the event of an issuer’s bankruptcy or restructuring could lose all value. A slower-growth or recessionary economic environment could have an adverse effect on the price of all stocks.
Corporate Bonds are debt securities to borrow money. Generally, issuers pay investors periodic interest and repay the amount borrowed either periodically during the life of the security and/or at maturity. Alternatively, investors can purchase other debt securities, such as zero coupon bonds, which do not pay current interest, but rather are priced at a discount from their face values and their values accrete over time to face value at maturity. The market prices of debt securities fluctuate depending on factors such as interest rates, credit quality, and maturity. In general, market prices of debt securities decline when interest rates rise and increase when interest rates fall. The longer the time to a bond’s maturity, the greater its interest rate risk.
Exchange Traded Funds (ETFs) prices may vary significantly from the Net Asset Value due to market conditions. Certain exchange traded funds may not track underlying benchmarks as expected. ETFs are also subject to the following risks: (i) an ETF’s shares may trade at a market price that is above (premium) or below (discount) their net asset value and an ETF purchased at a premium may ultimately be sold at a discount; (ii) trading of an ETF’s shares may be halted if the listing exchange’s officials deem such action appropriate, the shares are delisted from the exchange, or the activation of market-wide “circuit breakers” (which are tied to large decreases in stock prices) halts stock trading generally. The Adviser has no control over the risks taken by the underlying funds in which the Clients invest.
Municipal Bonds are debt obligations generally issued to obtain funds for various public purposes, including the construction of public facilities. Municipal bonds pay a lower rate of return than most other types of bonds. However, because of a municipal bond’s tax-favored status, investors should compare the relative after-tax return to the after-tax return of other bonds, depending on the investor’s tax bracket. Investing in municipal bonds carries the same general risks as investing in bonds in general. Those risks include interest rate risk, reinvestment risk, inflation risk, market risk, call or redemption risk, credit risk, and liquidity and valuation risk.
Mutual Funds When a Client invests in open-end mutual funds or ETFs, the Client indirectly bears its proportionate share of any fees and expenses payable directly by those funds. Therefore, the Client will incur higher expenses, many of which may be duplicative. In addition, the Client's overall portfolio may be affected by losses of an underlying fund and the level of risk arising from the investment practices of an underlying fund (such as the use of derivatives).
Options and other derivatives carry many unique risks, including time-sensitivity, and can result in the complete loss of principal. While covered call writing does provide a partial hedge to the stock against which the call is written, the hedge is limited to the amount of cash flow received when writing the option. When selling covered calls, there is a risk the underlying position may be called away at a price lower than the current market price.
Item 9: Disciplinary Information
Criminal or Civil Actions
EP and its management persons have not been involved in any criminal or civil action.
Administrative Enforcement Proceedings
EP and its management persons have not been involved in any administrative enforcement proceedings.
Self-Regulatory Organization Enforcement Proceedings
EP and its management persons have not been involved in any self-regulatory organization (SRO) proceeding.
Item 10: Other Financial Industry Activities and Affiliations
Broker-Dealer Affiliation
Neither EP or its management persons is registered, or have an application pending to register, as a broker-dealer or a registered representative of a broker-dealer.
Other Affiliations
Neither EP or its management persons is registered, or have an application pending to register, as a futures commission merchant, commodity pool operator, commodity trading advisor, or an associated person of the foregoing entities.
Related Persons
Neither EP or its management persons have any relationship or arrangement with any outside financial industry related parties.
Recommendations or Selections of Other Investment Advisers
EP does not recommend or select other investment advisers for our clients.
Item 11: Code of Ethics, Participation or Interest in Client Transactions and Personal Trading
As a fiduciary, our firm has a duty of utmost good faith to act solely in the best interests of each Client. Our Clients entrust us with their funds and personal information, which in turn places a high standard on our conduct and integrity. Our fiduciary duty is a core aspect of our Code of Ethics and represents the expected basis of all of our dealings.
Code of Ethics Description
This Code of Ethics does not attempt to identify all possible conflicts of interest, and compliance with each of its specific provisions will not shield our firm or its access persons from liability for misconduct that violates a fiduciary duty to our Clients. A summary of the Code of Ethics' Principles is outlined below.
Integrity - Access persons shall offer and provide professional services with integrity.
Objectivity - Access persons shall be objective in providing professional services to Clients.
Competence - Access persons shall provide services to Clients competently and maintain the necessary knowledge and skill to continue to do so in those areas in which they are engaged.
Fairness - Access persons shall perform professional services in a manner that is fair and reasonable to Clients, principals, partners, and employers, and shall disclose conflict(s) of interest in providing such services.
Confidentiality - Access persons shall not disclose confidential Client information without the specific consent of the Client unless in response to proper legal process, or as required by law.
Professionalism - Access persons conduct in all matters shall reflect the credit of the profession.
Diligence - Access persons shall act diligently in providing professional services.
We periodically review and amend our Code of Ethics to ensure that it remains current, and we require all firm access persons to attest to their understanding of and adherence to the Code of Ethics at least annually. Our firm will provide a copy of its Code of Ethics to any Client or prospective Client upon request.
Investment Recommendations Involving a Material Financial Interest and Conflicts of Interest
Neither our firm, its access persons, or any related person is authorized to recommend to a Client or effect a transaction for a Client, involving any security in which our firm or a related person has a material financial interest, such as in the capacity as an underwriter, adviser to the issuer, principal transaction, among others.
Advisory Firm Purchase of Same Securities Recommended to Clients and Conflicts of Interest
Our firm, its access persons, and its related persons may buy or sell securities similar to, or different from, those we recommend to Clients. This may provide an opportunity for representatives of EP to buy or sell securities before or after recommending securities to Clients resulting in representatives profiting off the recommendations they provide to Clients; however, EP will never engage in trading that operates to the Client’s disadvantage if representatives of EP buy or sell securities at or around the same time as Clients. In addition, our Code of Ethics may require that we restrict or prohibit access persons’ transactions in specific reportable securities. Any exceptions or trading pre-clearance must be approved by EP’s Chief Compliance Officer in advance of the transaction in an account. EP maintains a copy of access persons’ personal securities transactions as required.
Trading Securities At/Around the Same Time as Client’s Securities
From time to time our firm, its access persons, or its related persons may buy or sell securities for themselves at or around the same time as they buy or sell securities for Clients’ account(s). This creates a conflict of interest in that we have an incentive to trade securities that may place our interests ahead of the Clients. In order to mitigate these conflicts of interest involving the firm and personal trading practices, we will ensure all trading is done in a manner that never disadvantages Clients or places our interests ahead of theirs.
Item 12: Brokerage Practices
Factors Used to Select Custodians
EP does not have any affiliation with any custodian we recommend. Specific custodian recommendations are made to the Client based on their need for such services. We recommend custodians based on the reputation and services provided by the firm.
In recommending custodians, we have an obligation to seek the “best execution” of transactions in Client accounts. The determinative factor in the analysis of best execution is not the lowest possible commission cost, but whether the transaction represents the best qualitative execution, taking into consideration the full range of the custodian’s services. The factors we consider when evaluating a custodian for best execution include, without limitation, the custodian’s:
Combination of transaction execution services and asset custody services (generally without a separate fee for custody);
Capability to execute, clear, and settle trades (buy and sell securities for your account);
Capability to facilitate transfers and payments to and from accounts (wire transfers, check requests, bill payment, etc.);
Breadth of available investment products (stocks, bonds, mutual funds, exchange-traded funds (ETFs), etc.);
Availability of investment research and tools that assist us in making investment decisions;
Quality of services;
Competitiveness of the price of those services (commission rates, margin interest rates, other fees, etc.) and willingness to negotiate the prices;
Reputation, financial strength, security and stability;
Prior service to us and our clients.
With this in consideration, our firm recommends Altruist or Charles Schwab & Co., Inc. (“Schwab”), independent and unaffiliated SEC registered broker-dealer firms and members of the Financial Industry Regulatory Authority (“FINRA”) and the Securities Investor Protection Corporation (“SIPC”).
Research and Other Soft-Dollar Benefits
We do not have any soft-dollar arrangements with custodians whereby soft-dollar credits, used to purchase products and services, are earned directly in proportion to the amount of commissions paid by a Client. However, as a result of being on their institutional platform, Altruist or Schwab may provide us with certain services that may benefit us.
Altruist
EP offers investment advisory services through the custodial platform offered by Altruist Financial LLC, an unaffiliated SEC-registered broker-dealer and FINRA/SIPC member (“Altruist”). EP’s Clients establish brokerage accounts through Altruist. EP maintains an institutional relationship with Altruist whereby Altruist provides certain benefits to EP, including a fully digital account opening process, a variety of available investments, and integration with software tools that can benefit EP and its Clients.
Schwab
Schwab Advisor Services™ is Schwab’s business serving independent investment advisory firms like us. They provide our Clients and us with access to their institutional brokerage services (trading, custody, reporting and related services), many of which are not typically available to Schwab retail customers. Schwab also makes available various support services. Some of those services help us manage or administer our Clients’ accounts, while others help us manage and grow our business. Schwab’s support services are generally available on an unsolicited basis (we don’t have to request them) and at no charge to us. The benefits received by Advisor or its personnel do not depend on the number of brokerage transactions directed to Schwab. As part of its fiduciary duties to Clients, Advisor at all times must put the interests of its Clients first. Clients should be aware, however, that the receipt of economic benefits by Advisor or its related persons in and of itself creates a potential conflict of interest and may indirectly influence the Advisor’s choice of Schwab for custody and brokerage services. This conflict of interest is mitigated as Advisor regularly reviews the factors used to select custodians to ensure our recommendation is appropriate. Following is a more detailed description of Schwab’s support services:
Services that benefit you. Schwab’s institutional brokerage services include access to a broad range of investment products, execution of securities transactions, and custody of Client assets. The investment products available through Schwab include some to which we might not otherwise have access or that would require a significantly higher minimum initial investment by our Clients. Schwab’s services described in this paragraph generally benefit you and your account.
Services that may not directly benefit you. Schwab also makes available to us other products and services that benefit us but may not directly benefit you or your account. These products and services assist us in managing and administering our Clients’ accounts. They include investment research, both Schwab’s own and that of third parties. We may use this research to service all or a substantial number of our Clients’ accounts, including accounts not maintained at Schwab. In addition to investment research, Schwab also makes available software and other technology that:
provide access to Client account data (such as duplicate trade confirmations and account statements)
facilitate trade execution and allocate aggregated trade orders for multiple Client accounts
provide pricing and other market data
facilitate payment of our fees from our Clients’ accounts
assist with back-office functions, recordkeeping, and Client reporting
Services that generally benefit only us. Schwab also offers other services intended to help us manage and further develop our business enterprise. These services include:
Educational conferences and events
Consulting on technology, compliance, legal, and business needs
Publications and conferences on practice management and business succession
Your brokerage and custody costs. For our Clients’ accounts that Schwab maintains, Schwab generally does not charge you separately for custody services but is compensated by charging you commissions or other fees on trades that it executes or that settle into your Schwab account. Certain trades (for example, many mutual funds and ETFs) may not incur Schwab commissions or transaction fees.
Brokerage for Client Referrals
We receive no referrals from a custodian, broker-dealer or third party in exchange for using that custodian, broker-dealer or third party.
Clients Directing Which Broker/Dealer/Custodian to Use
Our firm recommends Clients establish account(s) at Altruist or Schwab to execute transactions through. We will assist with establishing your account(s) at Altruist or Schwab however, we will not have the authority to open accounts on the Client's behalf. Not all investment advisers require their Clients to use their recommended custodian. By recommending that Clients use Altruist or Schwab, we may be unable to achieve the most favorable execution of Client transactions, and this practice may cost Clients more money. We base our recommendations on the factors disclosed in Item 12 herein and will only recommend custodians if we believe it's in the best interest of the Client.
If Clients do not wish to utilize our recommended custodians, we permit Clients to direct brokerage. We will be added to your account through a limited trading authority. However, due to restraints from not having access to an institutional platform, we are unable to achieve most favorable execution of Client transactions. Clients directing brokerage may cost Clients more money. For example, in a directed brokerage account, the Client may pay higher brokerage commissions because we may not be able to aggregate orders to reduce transaction costs, or the Client may receive a higher transaction price at their selected custodian versus our recommended custodian.
Aggregating (Block) Trading for Multiple Client Accounts
Aggregating orders, batch trading, or block trading is a process where trades for the same securities are purchased or sold for several clients at approximately the same time. We do not engage in block trading. It should be noted that implementing trades on a block or aggregate basis may be less expensive for client accounts; however, it is our trading policy to implement all client orders on an individual basis. Therefore, we do not aggregate or “block” client transactions. Considering the types of investments we hold in advisory client accounts, we do not believe clients are hindered in any way because we trade accounts individually. This is because we develop individualized investment strategies for clients and holdings will vary. Our strategies are primarily developed for the long-term and minor differences in price execution are not material to our overall investment strategy.
Item 13: Review of Accounts
Periodic Reviews
Robert Moore, Founder/Owner and CCO of EP, will work with Clients to obtain current information regarding their assets and investment holdings and will review this information as part of our financial planning services. EP does not provide specific reports to Clients, other than financial plans. Clients who engage us for investment management services will have their account(s) reviewed regularly on a quarterly basis. The account(s) are reviewed with regards to the Client’s investment policies and risk tolerance levels.
Triggers of Reviews
Events that may trigger a special review would be unusual performance, addition or deletions of Client-imposed restrictions, excessive draw-down, volatility in performance, or buy and sell decisions from the firm or per Client's needs.
Review Reports
Clients will receive trade confirmations from the custodian(s) for each transaction in their accounts as well as monthly or quarterly statements and annual tax reporting statements from their custodian showing all activity in the accounts, such as receipt of dividends and interest.
EP does not provide written performance or holdings reports to Investment Management Clients outside of what is provided directly by their custodian.
Item 14: Client Referrals and Other Compensation
Compensation Received by Everman Prosperity LLC
EP is a fee-only firm that is compensated solely by its Clients. EP does not receive commissions or other sales-related compensation. Except as mentioned in Item 12 above, we do not receive any economic benefit, directly or indirectly, from any third party for advice rendered to our Clients.
Client Referrals from Solicitors
EP does not, directly or indirectly, compensate any person who is not advisory personnel for Client referrals.
Item 15: Custody
EP has limited custody of Client funds due to our ability to deduct advisory fees from the Client(s) account. All Client assets are held at a qualified custodian.
If EP deducts its advisory fee from Client’s account(s), the following safeguards will be applied:
The Client will provide written authorization to EP, permitting us to be paid directly from Client’s accounts held by the custodian.
The custodian will send at least quarterly statements to the Client showing all disbursements from the accounts, including the amount of the advisory fee.
In jurisdictions where required, EP will send an itemized invoice to the Client at the same time it instructs the custodian to debit the advisory fee. Itemization includes the formula used to calculate the fee, the amount of assets under management the fee is based on, and the time period covered by the fee.
We urge you to carefully review custodial statements and compare them to the account invoices or reports that we may provide to you and notify us of any discrepancies. Clients are responsible for verifying the accuracy of these fees as listed on the custodian’s brokerage statement as the custodian does not assume this responsibility. Our invoices or reports may vary from custodial statements based on accounting procedures, reporting dates, or valuation methodologies of certain securities.
Item 16: Investment Discretion
For those Client accounts where we provide Investment Management Services, EP has discretionary authority and limited power of attorney to determine the securities and the amount of securities to be bought or sold for a Client’s account without having to obtain prior Client approval for each transaction. Investment discretion is explained to Clients in detail when an advisory relationship has commenced. At the start of the advisory relationship, the Client will execute a Limited Power of Attorney, which will grant our firm discretion over the account(s). Additionally, the discretionary relationship will be outlined in the Advisory Contract and signed by the Client. Clients may limit our discretion by requesting certain restrictions on investments. However, approval of such requests are at the firm’s sole discretion.
Item 17: Voting Client Securities
We do not vote Client proxies. Therefore, Clients maintain exclusive responsibility for: (1) voting proxies, and (2) acting on corporate actions pertaining to the Client’s investment assets. The Client shall instruct the Client’s qualified custodian to forward to the Client copies of all proxies and shareholder communications relating to the Client’s investment assets. If the Client would like our opinion on a particular proxy vote, they may contact us at the number listed on the cover of this brochure.
In most cases, you will receive proxy materials directly from the account custodian. However, in the event we were to receive any written or electronic proxy materials, we would forward them directly to you by mail, unless you have authorized our firm to contact you by electronic mail, in which case, we would forward you any electronic solicitation to vote proxies.
Item 18: Financial Information
We have no financial commitment that impairs our ability to meet contractual and fiduciary commitments to our Clients, nor have we been the subject of any bankruptcy proceeding. We do not have custody of Client funds or securities, except as disclosed in Item 15 above, or require or solicit prepayment of more than $500 in fees six months or more in advance.
Item 19: Requirements for State-Registered Advisers
Principal Officers
Robert Moore serves as EP’s sole principal and CCO. Information about Robert Moore’s education, business background, and outside business activities can be found in his ADV Part 2B, Brochure Supplement attached to this Brochure.
Outside Business
All outside business information, if applicable, of EP is disclosed in Item 10 of this Brochure.
Performance-Based Fees
Neither EP or Robert Moore is compensated by performance-based fees.
Please refer to Item 6 of this brochure.
Material Disciplinary Disclosures
No management person at EP has ever been involved in an arbitration claim of any kind or been found liable in a civil, self-regulatory organization, or administrative proceeding.
Material Relationships That Management Persons Have With Issuers of Securities
EP nor Robert Moore have any relationship or arrangement with issuers of securities.
Everman Prosperity LLC
8647 Oak Chase Circle
Fairfax Station, VA 22039
571-244-1802
Form ADV Part 2B – Brochure Supplement
Dated: January 19, 2024
For
Robert Moore
Founder/Owner and Chief Compliance Officer
This brochure supplement provides information about Robert Moore that supplements the Everman Prosperity LLC (“EP”) brochure. A copy of that brochure precedes this supplement. Please contact Robert Moore if the EP brochure is not included with this supplement or if you have any questions about the contents of this supplement.
Additional information about Robert Moore is available on the SEC’s website at www.adviserinfo.sec.gov which can be found using the identification number 7846587.
Item 2: Educational Background and Business Experience
Robert Moore
Born: 1977
Educational Background
2023 - Certificate in Personal Financial Planning, Penn State University
2003 - Music Performance, University of North Texas
2000 - Music Education, Michigan State University
Business Experience
11/2022 - Present, Everman Prosperity LLC, Founder/Owner and Chief Compliance Officer
07/2003 - Present, Active Duty, United States Army
Item 3: Disciplinary Information
Robert Moore has never been involved in an arbitration claim of any kind or been found liable in a civil, self-regulatory organization, or administrative proceeding.
Item 4: Other Business Activities
Robert Moore is an Active Duty member of the US Army. This may create a potential conflict of interest because Robert Moore dedicates 100% of his time during trading hours to this activity, however, as a fiduciary, Mr. Moore has a duty of utmost good faith to act solely in the best interests of each Client and will ensure all Client’s needs are promptly addressed. This conflict is mitigated as EP’s investment strategy does not involve daily active trading.
Item 5: Additional Compensation
Robert Moore does not receive any economic benefit from any person, company, or organization, in exchange for providing Clients advisory services through EP.
Item 6: Supervision
Robert Moore as Chief Compliance Officer of EP, supervises the advisory activities of our firm. Robert Moore is bound by and will adhere to the firm’s policies and procedures and Code of Ethics. Clients may contact Robert Moore at the phone number on this brochure supplement.
Item 7: Requirements for State Registered Advisers
Robert Moore has NOT been involved in an arbitration, civil proceeding, self-regulatory proceeding, administrative proceeding, or a bankruptcy petition.