The following information is provided pursuant to the Investment Advisers Act of 1940 (The Act of August 22, 1940, 54 Stat. 847, 15 U.S. Code, Secs. 80b-1 -- 80b-21, as amended.)
This is only a partial reprint taken from the full brochure. This information should be considered before becoming a client of Lennox Financial. If you wish to pursue a relationship with Lennox Financial, we will mail you a complete copy of our disclosure brochure. Additionally, we would be happy to answer any further questions you may have. This information has not been approved or verified by any governmental authority.
LENNOX FINANCIAL
Lennox Financial has been providing investment advice to the public for more than 25 years. John L. Boyle, as a sole proprietor, conducts business under the trade name Lennox Financial (hereafter the "Firm"). John L. Boyle is the successor to the business formerly conducted by Lennox Financial, L.L.C., an Arizona limited liability company, which was registered with the Securities and Exchange Commission. John L. Boyle is a Certified Financial Planner and is the sole portfolio manager and investment adviser for the Firm. Under regulations promulgated by the United States Securities and Exchange Commission under the Investment Advisers Act of 1940 effective in 1997, John L. Boyle, doing business as Lennox Financial, is registered with the State of Massachusetts as an Investment Adviser/Financial Planner effective 1998. Lennox Financial will also maintain registrations in other states where required by regulation.
HOW TO REACH US
Phone Number: 781-592-6662
Client Toll-free Phone Number: 866-209-1603
Web Address: www.lennoxfinancial.com
also: www.lennoxfinancial.biz & www.lennoxfinancial.net
Mailing Address: 168R Humphrey Street Swampscott, MA 01907
Formal Office Hours: 9 AM to 4 PM
OUR SERVICES
John L. Boyle dba Lennox Financial is engaged in the business of providing investment advice, investment management services, and financial planning to individuals, pension and profit sharing plans, trusts, and corporations. It is anticipated that the primary business of the Firm will continue to be the management of individual investment portfolios (separately managed accounts) for clients with full trading discretion. At no time will the Firm have custody of the client's funds or securities. Trading will be directed to a licensed broker/dealer that the client selects. Lennox Financial is not a securities broker, and does not receive any portion of the commission dollars paid to the broker selected by the client. Lennox Financial will also provide advice to clients who wish to maintain self-directed accounts.
Investments
Types of investments typically include exchange-listed equity securities, securities traded over the counter, American Depository Receipts of foreign issuers, foreign securities, corporate debt securities, municipal securities, United States government securities, bank certificates of deposit, real estate investment trusts (REITs), derivatives, options, real estate, exchange traded funds (ETFs), structured products, and investment company securities, including mutual fund shares. Some accounts may invest in complex combinations, including the use of short selling and option spreads and straddles.
Methods
Both fundamental and technical analysis is used to make investment decisions. Main sources of information include annual reports, prospectuses, filings with the Securities and Exchange Commission, research materials prepared by others, corporate rating services, financial newspapers and magazines, electronic news services, industry contacts, inspections of corporate activities, company press releases, and information posted on the internet (the world wide web). Investment strategies generally involve identifying undervalued securities for long term purchases, short-term trading on special situations, dividend capture, and asset allocation among different market segments and classes of securities. Risk management is an important component of the investment service provided. In some accounts (when specifically authorized), trading may include the use of options, derivatives, and short selling. The Firm has developed and owns various proprietary computer programs including an expert system and neural networks that it uses in conjunction with proprietary theories that predict future price movements.
YOUR BROKER/DEALER
Client accounts shall be held separately in the client's name at a non-affiliated broker/dealer. The Firm has no authority to determine the broker/dealer, or custodian to be used and does not determine broker commission rates or fees. Such decisions are exclusively the responsibility of the client. However, the Firm may refuse to accept an account if the broker selected by the client will not cooperate with the Firm or is otherwise incompatible in a way that would ultimately work to the disadvantage of the client. The Firm has a good working relationship with Ameritrade Institutional Services (TD Ameritrade) and finds it is an advantage for most clients to be on the same trading platform with other accounts managed by the Firm; but in all cases each client is encouraged to compare quality of service and commission rates with other brokers. One of the best safeguards for the client is complete transparency into everything that is happening with the client's account. Thus, clients are recommended to select a broker/dealer that permits real-time access to the client's account on the internet. John L. Boyle never receives any direct compensation for suggesting brokers. Any indirect benefit, such as access to research, will be used for the benefit of all clients unless prohibited by law or agreement.
ACCOUNT MANAGEMENT - Types Of Account
The typical managed account is a full-service separately managed account. John L. Boyle will have full discretion to select the securities to be bought or sold, the amount to be traded, and the timing of the trade. Clients will be asked to sign a discretionary trading authorization with the broker/dealer that they select, appointing Lennox Financial with authority limited to trading. Discretion does not include authority to withdraw cash or securities (except to arrange transfer to another account held by the client). Trading in client accounts takes place in accord with the management agreement and investment policy agreed to with the client. In addition to the trade confirmations and monthly statements provided by the custodian/broker, clients with individually managed accounts will receive from the Firm regular quarterly performance reports. Comparisons may be made to common indexes such as, but not limited to, the Standard & Poor's 500 stock index. In special circumstances the client may be provided with interim status reports.
Lennox Financial also offers advice to self-directed trading accounts in which the Firm does not have discretionary trading authority for the purpose of making decisions. The role of the Firm is to act as an adviser and not a manager. These accounts do not have a minimum size requirement. Often these accounts are part of a "household" and advised in conjunction with other managed accounts owned by the same person or family. Although Lennox Financial is given discretionary authority to place trades in these self-directed accounts, trades will only be placed after the client has provided specific permission and instructions for each trade. The trades will therefore be marked as "unsolicited", and "non-discretionary" since the purchase or sale decision, as well as the price and amount, rests with the client.
Lennox Financial may also manage specially designated, separate, speculative trading accounts. Minimum account size is usually $25,000 for speculative trading (typically option accounts); and clients are carefully advised of the higher risk that accompanies the profit opportunity in these accounts. Speculative accounts are intended to represent a small amount of the client's total assets and are used for hedging or speculative trading. If an investor is not otherwise qualified as accredited according to the definition in Regulation D promulgated under the Securities Act of 1933, the primary guideline for investment in a speculative account is that the total loss of all money invested will not materially affect the financial security or life-style of the investor. As a general rule, the investor should have a net worth (exclusive of home, furnishings, and automobiles) of at least five times his investment in a speculative account; or he should have a net worth of at least two and one-half times his investment and have had during his last two taxable years, and estimates that he will have during his current taxable year, gross income of at least two and one-half times his investment; and that the investor has adequate means of providing for his current needs and personal contingencies and has no need for immediate liquidity in this investment.
Lennox Financial may also manage individual hedge accounts (referred to as all-weather accounts) that are designed to control risk and enhance profits through the use of derivatives and short selling. Although hedge accounts are not intended to be speculative and are designed to improve risk management, the use of options and short selling is traditionally viewed as potentially risky. Although these accounts must be set up as margin accounts, risk management dictates that the use of margin leverage is not intended as a trading strategy. While these accounts are intended to reduce loss in falling markets, and generate additional income in flat markets, as well as participate in rising markets, the results achieved for any account may vary considerably from the intended objective; and clients should carefully balance the intended benefits of this type of account against the possible risks when deciding appropriateness for client's specific situation. Minimum account size for individual hedge accounts is $150,000.00.
ACCOUNT SIZE
Minimums stated herein are guidelines. Exceptions may be made for various reasons, but minimums are generally designed to prevent the risk of concentration and costs of account operation from being a detriment to the client. For smaller accounts, clients are cautioned to consider the impact that fees may have on net performance as well as the risk of a lack of diversification. The Firm may decline to accept smaller accounts, or may open accounts below the stated minimum if additional funds are expected to be contributed in the near future. Lennox Financial may refuse an account for any reason including, but not limited to, a failure of the broker/dealer selected by the client to cooperate with Lennox Financial, restrictions placed on the account by the client that are too difficult or expensive to comply with, or a lack of suitability as determined by the selected broker/dealer or by Lennox Financial.
OUR FIDUCIARY RESPONSIBILITIES
As an investment adviser, we are considered to have a fiduciary relationship with our clients, and are held to higher standards than might be expected in a simple commercial transaction, such as the purchase of securities through a broker.
These standards include
The obligation to disclose to the client all material conflicts between the clients interests and the Firm's interests
The obligation to disclose any third-party compensation that we might receive as a result of our relationship with a client.
A prohibition from engaging in transactions with a client for the Firm's account or the account of any employee.
The obligation to treat all clients equitably, and no client will be provided an unfair advantage that may be to the disadvantage of another client.
The obligation to make investment decisions for clients that are suitable and consistent with the investment objectives of the client.
The obligation to place the interests of the client ahead of the interests of the Firm and any employees of the Firm.
Avoiding Conflicts Of Interest
Most clients consider it desirable that John Boyle invests his own money in a manner consistent with the advice he is giving to clients. John Boyle is an active investor. Thinly traded securities and initial public offerings will not be purchased by John Boyle or members of his family in competition with clients. Trading for John L. Boyle or accounts for members of his family will be treated on an equal basis with other clients only in large publicly traded markets when the size of the trade relative to the size of the market makes it extremely unlikely that there would be any meaningful effect. In general, if personal trades are not bunched with client trades as part of a block order, personal trades will occur after client trades. If a clear conflict does arise, the interests of the client will always be placed first. If any conflict is expected to continue over a period of time, or be of a size that is meaningful, the client will be notified in writing. Upon request, Lennox Financial will provide to any client, or prospective client, a copy of our fiduciary responsibilities and code of ethics.
YOUR INVESTMENT ADVISER
John L. Boyle is the sole portfolio manager, and will manage accounts in accordance with the client's Investment Policy Statement. John L. Boyle monitors all managed accounts on a regular unscheduled basis for the purpose of making buy and sell decisions or offering advice to the client. Detailed account reviews take place quarterly, and regulations require the statement that all client accounts are reviewed no less than annually. Services include preparation of an investment policy statement with the client, supervising the account, providing performance reports, and being available to consult and answer investment related questions.
John L. Boyle was born in the year 1949 in Boston, Massachusetts. John L. Boyle attended high school for three years at Phillips Academy in Andover, MA. He attended Harvard University in Cambridge, Mass. (with advanced placement) for three years and graduated cum laude with a Bachelor of Arts major in social sciences. He has also taken various business and economic classes at the Sloan School of Business at the Massachusetts Institute of Technology, at Arizona State University, and at Salem State College. In 1982 John L. Boyle completed a two year course of study under the College of Financial Planning in Denver Colorado. In the late 1970's John Boyle published an investment letter under the name Lennox Financial. From 1979 to 1983 John L. Boyle owned, managed and acted as Designated Broker for REP CO. International and related investment companies. From 1983 to 1990 he was employed as a stockbroker with the investment banking firm of Kidder, Peabody. John Boyle worked as an independent contractor with Fox & Company in Phoenix, AZ, a licensed Broker/Deealer (CRD #18517), from 1990 through 2004, and Fox Advisor Group (CRD #130593). From 1990 to 1995 John L. Boyle, acting as a sole proprietor, conducted an investment management business under the trade name Lennox Financial. From 1995 to the end of 1997 John L. Boyle conducted the same business under the name of Lennox Financial, L.L.C., an Arizona limited liability company. John L. Boyle can be reached at: (781) 592-6662.
John L. Boyle is a licensed Real Estate Broker with the State of Massachusetts with the authority to consult on the purchase, sale, and management of real estate, and/or represent the buyer or seller in a contractual agreement. John Boyle uses his extensive prior real estate experience to advise investors on real estate related securities. Other than spending time on license requirements, such as continuing education, John Boyle has not spent, and does not anticipate spending, any additional time on real estate activities as an "outside business activity". From 1983 through 2004, John L. Boyle was licensed with the NASD as a series 7 registered representative. Although John L. Boyle was previously licensed with the CFTC to sell commodity futures, that license is voluntarily inactive. John Boyle also held a license as a real estate broker, insurance agent, and mortgage broker with the State of Arizona, but those licenses have not been renewed due to a change in residence.
MANAGEMENT FEES
Compensation paid to Lennox Financial is generally a fee calculated on the assets under management. This fee does not include certain other costs paid to third parties such as, but not limited to, brokerage commissions, dealer mark-ups, exchange fees, custodian fees, odd-lot differentials, and transfer taxes. Compensation is payable quarterly in advance as a percent of assets under management as follows (except hedge accounts are billed quarterly in arrears)
Please contact us directly for a detailed schedult of fees for your areas of interest.
All fees are negotiable, and discounts may be offered by aggregating accounts in the same family to reach a higher break point. Clients are offered the choice of having management fees deducted from the account that generates the fee, having the fee deducted from another designated account held at the same broker/dealer, or having fees billed directly to the client. Clients will be asked to sign an authorization with their broker/dealer to have fees deducted from their account, unless other arrangements for payment are agreed upon.
Investment management clients must sign a "Client Agreement" (Investment Management Agreement), and client "Investment Policy" statement providing further disclosure and clarification of the business practices of the Firm as they relate to the specific client.
The Investment Management Agreement is a voluntary agreement that may be canceled by either party at will. In the event of termination, management fees are prorated for the period that service was provided. The Agreement may not be assigned without prior written consent of the client.
Lennox Financial respects the complete privacy of its clients and does not release any client information to third parties. As stated in the Client Agreement, "all information furnished by either party to the other shall be treated as confidential and shall not be disclosed to third parties other than as agreed in writing or required by law". Clients are provided with a Privacy Policy as required by regulations.
This is a partial disclosure of the information provided in our official brochure. If you elect to contact us, we will deliver to you a complete brochure. Upon request, propective clients and clients will additionally be provided with form ADV part II in addition to this brochure.