How to invest in a product available on the Schwab Alternative Investment Marketplace™ platform

How to invest in a product available on the Schwab Alternative Investment Marketplace™ platform

The Schwab Alternative Investment Marketplace platform provides access to third-party platform sponsors offering menus of private funds.

To invest in a product on the AI Marketplace platform, you need to review the fund menu from one of the AI Marketplace platform providers. The fund menus are located on the platform provider websites, which can be found by going to the Schwab Alternative Investment Marketplace™ platform page on the Schwab Advisor Center® website. From there select, News & Resources > Financial Solutions > Alternative Investments > Schwab Alternative Investment Marketplace™. Scroll to the bottom of the page and select the links in the To get started section.

  1. At the website of the third-party platform sponsor, register, if needed, and log in.
  2. Review the funds available.
  3. If you see a fund you wish to discuss with a client, you will need to determine your client's eligibility. Once confirmed, review the fund with your client to determine if the client wishes to invest. 
  4. Complete subscription documents for the fund in which the client is interested. Download and save the completed subscription documents.
  5. You can elect to use the platform sponsor’s site to complete and submit the forms or you can log in to Schwab Advisor Center, go to Forms library and create an electronic envelope. Select the Schwab Alternative Investment Marketplace™ platform Letter of Authorization and tag the form for the client’s signature.
  6. The client then completes and signs the Schwab Alternative Investment Marketplace LOA and the subscription agreement.
  7. Submit the client signed documents to Schwab electronically.

Important: If you submit the documents via Schwab, after electronically submitting documents to Schwab, upload a copy of the executed subscription agreement to the third-party platform sponsor’s website. Also include supplemental documentation required by the fund, such as AML documents.
Transactions only take place when:

  • The third-party platform sponsor receives these documents by the fund’s document deadline, and
  • The subscription is approved prior to the close.

If you have completed SLOAs for your clients, and Schwab has received signed authorization from you instructing Schwab to process capital calls, when a fund on the AI Marketplace platform issues a capital call, Schwab notifies you via a Service Alert on Schwab Advisor Center.

  1. Check each account on the list to confirm the account is yours and holds the fund.
  2. Confirm you want to have each account satisfy the capital call request.
  3. Confirm each account has sufficient cash to cover the amount of the capital call.

If you confirm these items, no further action is required. Schwab processes the capital call on or before the due date of the call.

If you wish for the client account not to pay the capital call, notify Schwab at AIMarketplace@schwab.com.

Common Alternative Investment Categories
How to initiate a transfer or purchase for Schwab Alternative Investment Custody Services
How to subscribe to an investment available on the Schwab Alternative Investment OneSource® platform
Introduction to Alternative Investments at Schwab including Schwab platforms and Custody Services
Introduction to Schwab Alternative Investment Custody Services
The Schwab Alternative Investment Marketplace platform

Schwab does not provide investment advisors, or their clients, advice or make recommendations about potential investments in any Schwab or third-party alternative investment platform (including the funds made available on such platforms that participate in the Schwab Alternative Investment Marketplace platform). It is each investment advisor's responsibility to determine the suitability of such an investment for its clients. Schwab’s obligations are limited to acting as custodian of the interests purchased and providing recordkeeping, shareholder services and other administrative services.
 
Schwab receives remuneration from the third-party platform sponsors participating in the Schwab Alternative investment Marketplace platform for recordkeeping, shareholder services and other administrative services.
 
Third-party firms, including third-party platform sponsors are not owned by, affiliated with or supervised by Charles Schwab & Co., Inc.
 
Alternative investments, including funds that invest in alternative investments, are risky and may not be suitable for all investors. An investment in any offering made available through any third-party platform is speculative and involves a high degree of risk. Investors may lose all or a substantial portion of their investment. Alternative investment often employ leverage and other speculative practices that increase an investor’s risk of loss, often charge high fees, may require investors to satisfy capital calls, and can be highly illiquid and volatile. These investments may lack diversification, involve complex tax structures and have delays in reporting tax information.
 
This is not an offer of, or a solicitation to subscribe to or purchase, securities. Investors should obtain and carefully read the related prospectus or offering memorandum, which will contain the information needed to help evaluate the potential investment and provide important disclosures regarding risks, fees and expenses. Alternative investments are not subject to the same regulatory requirements as mutual funds.

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