Wrap fees are the industry's method for monetizing inactive accounts. It is an annual fee intended to cover all account charges. Wrap fees specifically exclude portfolio management or advisory services. The fee primarily covers all trading commissions, and provides enhanced reporting and access to research. Historically, 80% of a broker's commissions are derived from 20% of his or her clients. Wrap fees change that reality as every account, active or inactive, generate

"Volatility" refers to the propensity of a stock or index's market growth rate to diverge up or down from its average growth rate over time. Assume for discussion that the SP 500 has an average growth rate of 10% with a standard deviation of 15%. Standard deviation is a principally a portfolio measurement; it is both added and subtracted from the 10% average return to determine a likely outcome range. In this example, an investor can anticipate performance ranging in any s

"Sequence Risk" or "Sequence of Return Risk" applies to equity accounts burdened by fixed distributions. If Negative or even flat returns occur in the early years of withdrawals, long-term sustainability of the distributions will be permanently impaired. In short, lose money early and you will run out of money years before you planned. This is called Sequence of Return Risk and it only applies to accounts in distribution like retirement accounts. Google the term for broad