You’ve seen the headlines, and your clients have too. From tech disruptors to established brands, hotly anticipated Initial Public Offerings (IPOs) are capturing significant investor attention. In response to a notable increase in clients asking to participate in these offerings, we are introducing a formal policy to provide a clear and compliant path for handling these unsolicited requests. Our primary goal is to empower you to respond to client-directed instructions while upholding our collective fiduciary duty and managing the significant risks inherent in IPO investing.

A Structured Framework for Unsolicited Requests

Effective immediately, all unsolicited client requests to purchase an IPO must be processed through a case request utilizing the Client-Directed IPO Investment Acknowledgement, this document can be found in Nexus and is attached below. This is not a path for recommending IPOs which remains prohibited, but a supervised exception process for when a client, after being counseled on the risk of IPO’s, directs you to proceed.

Here are the key requirements you need to know:

• The process can only be initiated by a direct, unsolicited client request.
• The transaction is only available to clients who qualify as Accredited Investors. This is defined by either income of an individual of more than $200,000 per year, or a joint income with a spouse of more than $300,000 per year, for the last two years with the expectation of earning the same in the current year; or having a net worth of over $1 million, either individually or jointly with a spouse, excluding the value of a primary residence.
• Furthermore, the total cost of the IPO purchase cannot exceed 5% of the client's household assets held with Mutual Group
• The new "Client-Directed IPO Investment Acknowledgement" form is the cornerstone of this process. It documents that the request was unsolicited, that you counseled the client on the risks, and that the client is accepting the risks.
• Before any indication of interest is placed, the completed and signed form must be submitted to and approved in writing by a designated Principal/Supervisor.
• You must inform clients that our custodians and their underwriting partners strictly discourage flipping. Selling an IPO allocation within the initial holding period (typically 15-31 days) can cause a restriction to the Firm's access to future offerings.

Your Counsel Remains Critical

This policy reinforces your role as a trusted advisor. It creates a formal record that you have provided sound counsel regarding the high-risk, speculative nature of IPOs, even when the client chooses a different path.

We believe this framework provides a robust and compliant way to manage client demand for IPOs while ensuring our standards of care are met. Please familiarize yourself with the full policy, which is now available on the Compliance portal here. In addition, both Schwab and Fidelity have specific policies you should review prior to submitting your client’s indication of interest you can find more information here: How to participate in public offerings | Charles Schwab and Policies & Procedures (OLR) | Wealthscape