The buying power algorithm runs dynamically during all major cashflow events (Cash top-ups, rebalancing & switches, and withdrawals), with the exception of Regular Contributions (see below *).
Buying Power:
To enable the maintenance of model portfolios without any fixed percentage allocation to cash and to ensure that your investors assets are not needlessly divested to generate sufficient cash to cover future obligations (such as fees or regular withdrawals), the Platform will automatically calculate and hold-back sufficient cash to cover future Adviser, Platform and DFM fees based on the current market value of the account.
The Hubwise default is calculated to be sufficient for a twelve (12) month fee period and, where requested, to cover six (6) months’ withdrawals.
This held-back, or uninvested cash will automatically be re-calculated each time a cashflow event occurs namely a transaction. Re-calculation will also take place when an account goes into debt (following the posting of a fee invoice)
Buying Power Calculation |
Total Cash Position |
Minus Fees held back (based on the hold back period) |
Minus Withdrawals held back (based on the hold back period) |
Minus Cash that has been ring fenced for other activities |
Minus Current Open Orders |
Equals Surplus Cash / Cash Shortfall in Buying Power |
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