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CHUCK BROWN: Good afternoon, everyone, and welcome to today's webinar focused on a personalized coverage model for investors with large fund portfolios. I'm Chuck Brown. I manage the high net worth bond desk here at Fidelity.
In today's session, we're going to give you an overview of what our high net worth bond desk can offer and how the team provides a truly personalized service for our clients. Now, let me introduce our crew for today. Joining us is Brad Hanson. He's a high net worth bond desk consultant in our Denver team. And Tom Maciula, who is a fixed income regional brokerage consultant out of Texas. Thank you both for joining us today.
THOMAS MACIULA: Thank you, Chuck, for having us.
BRAD HANSON: Hey, good afternoon, everyone. Thanks, Chuck.
CHUCK BROWN: Well, let's get started with today's agenda. We've got five things to cover today. What is the high net worth bond desk? Two, let's talk about who does the high net worth bond desk interact with on a daily basis to provide this service?
Three, something that I think most of you are very interested in, is what are the unique services provided by the desk? Fourth, let's talk about the different types of fixed income investors that Brad and his peers talk to on a daily basis. And then finally, let's talk about the resources that are available above and beyond what you hear today.
So let's go on to what is the high net worth bond desk? Well, currently, the high net worth bond desk is 15 highly experienced, highly tenured fixed income professionals that provide this exclusive, personalized coverage for retail customers with $3 million in individual bonds and CDs held here at Fidelity. That is the only requirement that is asked to be referred to this desk.
We started this desk back in 2007, actually right before the financial crisis. Originally, we were just in Boston, but over the years, we expanded the desk to Denver. Currently, we have nine consultants in Denver and six in Boston. We break up the team into three regions. We have an East region, South, and West. With 15 consultants, it makes sense to put 5 in each region. The idea behind this is we would have five consultants, for example, five consultants covering the West.
If you're in California, you would get to know the five consultants on the West team. Now, periodically you may call in and one of the five is not available, and you may talk to somebody else. So anyone on the desk can help you. But the core idea behind it is you would get to the five key consultants in that region, and those consultants would get to you, making it much more personalized.
One of the key factors that makes this desk so effective is our partnership with Fidelity Capital Markets. We have a regular chat with them on a daily basis, whether it's through Bloomberg or from other means, to constantly keep up to date on market events, what's happening with trades, and various other things. Brad Hanson is going to go into greater detail on our relationship with capital markets in the next couple of slides.
So many times I get asked, is the high net worth bond desk, do they have access to a unique inventory that fidelity.com retail customers have? No, actually we work off the exact same inventory that is on fidelity.com. Our product team at Fidelity has done a fantastic job of aggregating, bringing in thousands of offerings throughout the street and making that available on fidelity.com. So we work with that same inventory. But as you can imagine, working with thousands and thousands of offerings, we've gotten pretty good about filtering out what is best for our customers, what is appropriate for our customers, what fits the needs of our customers.
On the left side, you can see our fixed income landing page. If you go to that page, below what you can see, there's a whole menu of things you can select to get more information on our offerings at Fidelity. On the right side, we have the yield table. The yield table is a very effective, high level chart that gives you an idea of where yields are based on product, credit, or term of the bond. Each of those blue numbers actually represent a link to offerings on fidelity.com.
So if you're just trying to get a ballpark of what AAA muni is looking for going out to 30 years, you can go straight to that box, click that item, and see some of the offerings, just some of them, that represent that product, credit, and term. So it's a very effective tool. But again, this is something that we both work off of along with clients who access fidelity.com. Who does the high net worth bond desk partner with? Well, Brad, who works on our Denver desk, works with these people all the time. So I'm going to turn this over to Brad so he can talk further about it.
BRAD HANSON: Hey, good afternoon, everyone, again. Brad Hanson. I work right on the high net worth bond desk covering the East region. So if you think of our model, we're a hub and spoke model. We're the spoke. If you think of the hub of the relationship, it might be your financial consultant or your relationship manager or any of the planning consultants that work with those folks, PWMs.
They're going to own the relationship within Fidelity. But anytime they need help with a highly specialized team like us or call us in, client's self-directed, they're trying to get money invested into fixed income, they'll tap us on the shoulder and we'll work with that client to help them build out their portfolios or meet their financial goals with the fixed income product.
We're also, like Chuck mentioned, we're in constant contact with Fidelity capital markets, our trading partner, our affiliate broker dealer. So we're working with the traders directly on a daily basis. We have a persistent chat with all the traders. Anytime a client is looking for maybe size, that would be a good time, then we'll really consult with Fidelity, looking for a block of a million or block of a 2 million muni in Massachusetts 10 years out.
That may not be actually on fidelity.com, but we can work with the trading desk and they can access the market and see what's going on there. So we're tapping in quite a bit with the traders, and they're always keeping us posted on flows and what they're seeing new deals, that type of thing.
Constant access to Fidelity strategists. Every single day, we have a persistent chat with strategists, and they're keeping us up to date on the market and flows there too. Also, we have a weekly meeting on Wednesdays with Capital Markets, one of the strategists. So we're in constant contact there. So they're always giving us a great flow of information.
And also at Fidelity Capital Markets, the syndicate desk, the underwriting desk, the new issue desks, if you will. So we're in constant contact with the muni team. That's where we spend most of our time basically each day. So we're always in contact with those guys. And then, obviously, our brokerage partners, like our investment solutions representatives and our regional brokerage consultants and fixed income regional consultants like Tom.
THOMAS MACIULA: Great, Brad. I'll talk a little bit about the RBC role. So I'm Tom Maciula. I'm the fixed income RBC for Oklahoma and Texas. When I started at the company, there were two fixed income RBCs, one in New York City and then me in Texas. Today, there's 11 of us. We're spread out all over the country.
Unlike the ISR or the fixed income or the high net worth bond desk, we can't place a trade or make a recommendation for our clients, but what we can do is help them become familiar with the tools that are available online and help them become familiar with the offerings that are available to our clients. I refer to it as one of Fidelity's best kept secrets, because that fixed income landing page has just a lot of really important data and really valuable offerings that are unique for Fidelity clients.
A lot of the full service bond shops all over the country will use the exact same sorts of offerings that we make available to our clients to source bonds that they show to their clients subsequently to finding them on the website. My team is available to help you learn how to read those offerings, learn how to use the tools that are available.
To the degree that you're new to the fixed income platform or fixed income product, we can explain how each product works, when it pays, when it matures, when it might get called. Also, again, if you haven't ever bought bonds before, we're available to help formulate a fixed income strategy for someone new to the product.
CHUCK BROWN: Great. Thanks, Tom. And Tom started to mention the street, the other broker dealers who provide fixed income. I think there are a few things that our high net worth bond desk does that is a little bit different than the rest of the street, and being that Brad talks to clients all day long, Brad, why don't you talk about some of the unique services?
BRAD HANSON: Yeah, absolutely. So the biggest thing that you do with us, with high net worth bond desk, is this personalized regional relationship that Chuck talked about earlier. There's only five of us on each team. We're a small group. We have a persistent chat amongst ourselves, so we understand what everyone else is doing during the day.
Plus, we sit together on a daily basis, so we're in constant contact with each other. So we know when we have-- when you're talking to a certain client, we're kind of tuned in with what all our clients are doing. And then especially the clients that are talking to us most often, forming relationships with them. So it's definitely a personalized service.
Like Chuck mentioned early on, there's only 15 of us within Fidelity. So pretty much everyone that is on our desk we have talked to individually at some point in time. And there's obviously clients we talk to repeatedly. There's clients that each of us talk to almost on a daily basis multiple times a day. So there's definitely that personalized relationship, that personalized service within our desk.
So as far as the services we provide on the desk, which clients find super helpful, is proactive bond call outs. So when you have maturities of 100,000 or more, we're going to give you a call, one, to make sure that you remember or saw that you have that maturity coming up. And two, help you get those funds reinvested if you want to help. So you can tap into us anytime you want reinvestment ideas. It could be in a completely different subasset class.
Maybe you've been rolling treasuries for a while and now you want to start getting out on the curve. We can have conversations about where on the curve might make most sense for you and what subasset class. Hey, maybe it's time to stop-- maybe if you're not really going to go on treasuries further out in the curve, maybe munis make more sense. You're in a high tax bracket. We can have all those conversations.
We're also going to give-- if we know that you're involved in that new issue market, specifically that municipal space and you want to work-- you're trying to get new issues. We have a underwriting desk that we're in constant contact with. We're going to give you calls when that new issue hits.
Whether it's a competitive deal, negotiated deal, we're going to give you a phone call to let you know that deal is there, make sure you saw it, because sometime people aren't reading their emails constantly. And we can talk about each one of those deals, where on that curve, where in that space might make the most sense. And then take your order, manage your order. If there's any repricing, we'll take you through that.
So here's an example, if you go to the next slide. So here we're looking at our new issue page. So on our new issue municipal page, you can see the different new issues that we're involved in at that point in time. So you can see the number of new issues. Maybe you're looking for something specific to your state that you're in. You can take a look there.
And then once you're looking at a deal-- so this first one on this page is DC housing-- we can look at the scale. You can click on the View Offerings over on the right side. And now you can see the different offerings that we have on that scale. We can talk about which ones might make the most sense. This is also super important too. If you're trying to place a larger order, maybe it's 500, maybe it's a million, maybe it's 250, we can help you figure out which maturities have the greatest quantities. So quantities available.
So if you're trying to buy a million but there's only a million available of that quantity or 750, we can help steer you to a different maturity and then just talk about review the credit and where these deals are priced in the past. So that's definitely where we can definitely help you out there.
And then if you're looking in the secondary market, we can help build your customized portfolio. So if you go to the next slide. So if you're looking for 5 to 10 year munis or 5 to 10 year corporates given a certain criteria, AA, single A, we could build up that proposal for you and then show you what that looks like, show you what the cash flow looks like, show you what the average yield looks like, show you what your maturity buckets are moving forward.
Sometimes people are building out ladders and they want to add on to the end of the ladder. We can build this customized portfolio proposal for you and go through it, the pros and cons of each of the offerings in there, and help you select all of the bonds that might make the most sense for you.
And then, obviously, the next slide. Fixed income analytics report. I think Tom's going to take it from here.
THOMAS MACIULA: Thanks, Brad. Yeah. So this is one of my favorite services provided by the high net worth desk. Periodically, they'll provide an analytical report on your existing portfolio. It, too, will show your projected income, when your coupon payments are made, who your issuers are, what your average duration is. If you're in a muni portfolio, it'll break it down by GOs versus revenue bonds.
If you're in a corporate portfolio, it'll break it down by industrials versus energy, for example. The other thing that this report does, which is great, is it will draw your attention to any kind of credit change that might have occurred on your bond portfolio, which is worth having a discussion with your rep about if that occurs.
And probably more importantly, and this is lends itself to one of the reasons why it's great to have your bond portfolio in one place, is it gives your contact, in this example the high net worth desk, a chance to review everything you own. And so before they make a suggestion on what you might do to add to the portfolio going forward, they're going to take into consideration what you already own, what the duration and the call risk is on that portfolio, who the issuers are. And then from there, make a educated recommendation that diversifies your portfolio while managing your cash flow and meeting your objectives. It's a great report.
Another thing Fidelity-- well, I mentioned earlier that Fidelity's bond offering is one of its best kept secrets. The pricing really is a remarkable option. I mentioned earlier that what you see on the fixed income landing page, our dealer to dealer offerings that we're seeing from all the other dealers that we talk to. Unlike a full service brokerage shop, we show you exactly what they're showing us. So you're able to, if you're doing it on your own or through the high net worth desk, you're able to buy at a dealer to dealer price plus $1. On secondary trades in the agency market, the corporate market, and the muni market, we charge $1 a bond or $1 per 1,000, up to $250 per trade to cover our cost of that transaction. I would argue that in most instances, Fidelity doesn't cover their costs, but they don't worry about it, so I'm all for it.
Periodically, we will do a mystery shopping exercise where we go in and compare confirms from other dealers to what we were doing the exact same day, the exact same time, on the exact same bond. And here's what we've discovered recently.
The example on the screen shows a corporate bond that we sold. Wells Fargo sold the same bond on the same day, as did Morgan Stanley and Merrill Lynch. We marked it up $1 from the dealer to dealer offering. Wells and Merrill moved it $12 greater than what the dealer to dealer offer is, and Morgan Stanley was $16 and 1/2 per bond more expensive than what was being offered on the screen.
If you're buying 100 bonds at a time, that's a material amount of money, and it materially affects your yield on that purchase too. You can see a similar comparison on a muni bond that we did on the exact same day. Again, the markups go from 7 and 1/2 to $16 per bond, where it's $1 per transaction, $1 per bond, one time fee if you hold the bonds to maturity at Fidelity. Over a long period of time, that's going to make a material difference in your net yield on your bond portfolio.
CHUCK BROWN: Hey, thanks, Tom. The next section, we're going to talk about the various types of customers that we talk to. Brad earlier talked about the partners that they work with and the various things they provide. But I think breaking out our customers and the various types of customers we have will actually be very helpful for you to see. So, Brad, why don't you take it on?
BRAD HANSON: Thanks again, Chuck. Yeah, so the common types of clients that we have on the high net worth bond desk, obviously we have a group of active, sophisticated bond buyers. These clients know pretty much exactly what they want, and they just want to check in with us from time to time on does their strategy make sense? Are we seeing anything else? Do they want to check with us? Hey, what do your strategists say? What are we thinking about rates moving forward?
Help synthesize the daily news. We're in a volatile stretch right here, so we're seeing big swings not only in the equity market but in the fixed income market as far as yields. There's obviously different times when munis become fixed, when munis become-- when they have extraordinary value, maybe not so much great value.
So we're going to talk about the valuation of muni bonds. We definitely have seen times where Treasury rates are going one direction up and you might see muni rates go down. So a lot of supply and demand in that muni market. So we can talk about the supply issues in the market or oversupply and how the funds are gobbling up muni bonds left and right. So we have these sophisticated buyers that we definitely cater to and ask a lot of great questions, and they want to tap into us kind of on an ongoing basis.
Speaking of on an ongoing basis, we definitely have clients who want collaboration. They have their strategy. They just want to fact check it. Hey, does this make sense? Does it really make sense to go out 30 years in a muni bond? Yeah, it might make some sense if you're trying to generate income over a long period of time. So there's definitely that kind of client where we're really honing in and digging deep into their portfolio to make sure that they're on track to meet their goals.
And also we have sporadic. We have a definite group of clients who are sporadically calling in. We really only talk to them when they have maturities. Maybe they only have maturity every three months, every four months. But we've definitely had conversations with them in the past. So when it comes up again, we have the next maturity. We're kind on the same page and we can help guide them on getting those funds reinvested when they have those maturities coming up.
I would say, as far as a product breakdown, we definitely spend most of our time, I'd say 80% of our brain power, in that muni space, really understanding the muni market. Because we have these tax focused bond buyers. They're looking at what's the best after tax return? So we're going to look at their-- we're going to help them look at their marginal tax rate to see, hey, do munis even make sense? Or maybe you should be in treasuries or agencies, that type of thing, or even corporate bonds. So we're definitely focused on the after tax nature of their investing.
And then sometimes along the curve, a taxable product might make, like right now, a taxable product probably makes most sense in the short end, and the muni product has more value on that longer end, that 10 to 20 year range. We're going to talk about that a lot with clients.
Also, we have a fair amount of clients that are looking at their muni, they're looking at their money market rates, and they're pick a money market fund between 3 and 1/4, 3 and 1/2 percent right now roughly. They're looking at alternatives to money market. You can go out 6 months, 12 months, and capture more yield potentially than a lot of those money markets. So a lot of clients we're working with are looking at that cash alternative, and they're kind of constantly rolling and beating up on those muni rates or on money market rates.
So those are the clients we're working with. Everywhere in between, we have sophisticated clients and we have clients who are just getting into it. We'll spend a lot of time with them up front to help them build that portfolio going forward. But definitely most of the clients we talk to on a daily basis are repeat clients who have formed good relationships with a lot of our clients.
And so then if you go to the next slide. So this is the verbatims we're getting from clients. This is just an example. I would say the-- I'm not going to read all these for you, but I would say the overarching theme here is a lot of us on the desk have a decade, two decades, three decades of experience within the fixed income markets. We tap into an expansive knowledge base.
Not only that, but a lot of us have been at Fidelity for a long time. So they've seen a lot of things. We've seen a lot of maybe an issue you might have. So we know how to problem solve. We've basically seen it all. So we can be a one stop shop for you. Between our tenure in the markets and tenure at here at Fidelity, and then with the small client base we work with and our small group, we can give you a very high level of service here on the high net worth bond desk. I'd say that's the overarching theme of a lot of the verbatims and the feedback we get from clients.
CHUCK BROWN: Great. Thanks, Brad. One thing I'd like to add to that is over the years, since we've been in business, since 2007, we've received hundreds of verbatims from clients. And we've actually collected them and looked at the themes behind what clients appreciate the most.
And it really comes down to three themes. One theme is professionalism. Second one is expertise or subject matter expert in fixed income. And the last one is efficiency. I think a lot of our clients, whether they're still working or they have active family lives, they're looking to come in with a question, want to buy some bonds, but many times they don't have a lot of time. So I think, as Brad alluded to, we've done this a lot. We have a lot of muscle memory here that we're able to be very efficient with our clients, and I've definitely received the feedback that that is appreciated.
I have a few key takeaways before we go into our last section. And the key takeaways, one is talking about what we've discussed today. The high net worth bond desk really is an opportunity for investors to really generate a personalized relationship with a very small team of fixing and professionals.
Brad talked about some of the things that we do. Many of these tasks that we do on a daily basis are focused on proactivity. Now, I can't guarantee we're always going to have capacity. Sometimes the markets get very, very busy. But I'm very impressed with the team on how proactive they are, whether it's proposals, sending out analytic reports, making or taking phone calls, and various things like that. So it's a very proactive team.
Some customers, I will admit, have said, hey, I don't need a call on this. I don't need a call on that. Just be there for me. And that works fine with us. Clients can basically cater the service around what they want.
And last but not least, I'm just going to mention the $3 million minimum to be part of this desk. Again, I would love to open this up to all investors, but in order to provide this personalized service and coverage model for clients, there had to be some kind of level that we had to set a minimum at.
The idea behind it is by having a set number of clients, we are able to develop that relationship with the client, their partner, the family beneficiaries. We have several examples on the desk where we've forged strong relationships with multiple generations. We've even had a few clients that have actually encouraged their children to work with us on the parents' portfolio, just so that in the event there is a transition, it's a smooth one. So many clients, again, have expressed their appreciation towards that.
Last section is talking about resources or additional resources beyond what we've discussed today. And I'm going to let Tom take that over.
THOMAS MACIULA: Great, Chuck, thanks. So going forward from today's presentation, as I mentioned before, our bond offering is a really phenomenal offering in itself and very competitive compared to anybody in the industry. The high net worth desk is a high touch additional service available to customers who qualify.
If you want to move forward, your initial step might be with your local rep at your local branch. If you don't have a rep at your local branch, you can always contact an Investment Service Representative or ISR. You can reach those ISRs by calling the 800 number in the upper right hand corner of the fixed income landing page. That number goes to one of four desks in three different time zones in the US, where you can reach somebody who knows a little bit about bonds.
Also, you can meet with your fixed income RBC. We'd be delighted to visit with you. And if you qualify for high net worth coverage, we're delighted to make the introduction to the high net worth desk and help them to follow up with you.
Also note, along the same lines as I mentioned, the fixed income landing page, that 800 number is right above what we call our carousel. It's a tall vertical window on the right hand side of the fixed income landing page. It rotates when you first refresh the landing page.
The third page of the landing page has replays of certain webinars that pertain exclusively to the fixed income markets. So if you have interest in learning more about the product or reviewing some of the webinars that we've given in the past, or having a hard time sleeping at night, feel free to access that resource on the third page of the carousel, and you can replay some of the webinars that we've done on the fixed income space.
CHUCK BROWN: Great. Thank you, Tom. Well, it looks like we do have some time here to go over some questions here. Are you guys ready? Tom, Brad? OK. We got a few here. I think, Brad, actually, this one might make sense for you. And Tom, feel free to jump in. Does cash or bond funds or ETFs count towards the $3 million threshold?
BRAD HANSON: Yeah, the $3 million threshold is just individual fixed income securities held in your brokerage account at Fidelity. It doesn't include cash or bond funds or ETFs or any of the managed products. You might have a muni managed solution SMA. That doesn't count towards our threshold of $3 million in fixed income securities held here at Fidelity.
CHUCK BROWN: Great. Thank you. How do I get in touch with the high net worth bond desk? Tom, since you're out in the field—
THOMAS MACIULA: If you qualify, feel free to call your local branch, your ISR through the 800 number on the fixed income landing page, and/or fixed income regional brokerage consultant like me.
CHUCK BROWN: Can your team compare the merits and risk of a fixed income managed account to working directly with the high net worth bond desk? Either one.
BRAD HANSON: Yeah, I can take that, Tom. Yeah, I would say definitely we can help compare. And it really is going to drive-- what's really going to drive that decision, which one might make more sense for you, is if you are self-directed and you really want to do this yourself, you want to do the research, you want to pick out the bonds, the tenure that you're looking for, your own customized portfolio.
You have the will, skill, and time to do that. We can definitely help you with that. But also if you want to look at more of a managed solution, you're going to have your different solutions, different tenures available. We could definitely take you through the pros and cons of each one. Tom, do you want to add to that a little bit?
THOMAS MACIULA: No, I think that's great. I think it has a lot to do with if you want to get your hands dirty, learn a little bit about the bonds, the high net worth desk is a great resource to have somebody peering over your shoulder, for lack of a better description. But ultimately, you're making the buy decisions. With an SMA or Separately Managed Account, we're going to do it all for you.
CHUCK BROWN: Yeah. And I'll just add one last point to that. Like Brad mentioned, there are some customers that never contact our desk. They're very sufficient. They just want to buy the treasuries themselves. There are many customers who already have the bond in mind that they want to buy, and they just come in and double check with us. Hey, I'm thinking about this San Marino bond. Can I get your thoughts on it? And we'll give our thoughts and go from there.
This is a good question because I think it clears something up. Are there any costs to leveraging the high net worth bond desk?
BRAD HANSON: There is no additional cost to tap into the high net worth bond does can work with us. Fidelity charges $1 per bond on the secondary market, and there's no additional cost working with our team here, whether it's in Denver or Boston. No additional cost. Free service.
CHUCK BROWN: But the best kept secret out there is new issues. And we talked about $1 per bond in the secondary market. But if you're buying new issue products at Fidelity or essentially anywhere, there is no cost to that transaction. The issuers pay the distributors to sell the product.
So when you're buying a municipal bond in the new issue market, there's no additional dollar per bond. You're buying it at the public offer price that's presented by the issuer. So it's a nice little thing. That's one of the reasons why we have an active program on calling out on new issues is because we think there's a tremendous value there.
You mentioned call slash reinvestment advice as a service. Do you also provide services for credit risk, in parentheses, default, liquidity, beyond what the rating agencies provide? Anyone?
BRAD HANSON: Yeah, I can hop in here. We get that question quite a bit. We're not credit analysts here on the desk. We don't have access to a group of credit analysts. So it's going to be pretty much what the rating agencies are showing. We can't really dig too deep into there.
If there's maybe you want to look at, hey, I need help figuring out what direction this credit is going or what might be falling apart, we can help you with that, but we really don't have the resources to dig in deep to it. But we can definitely help you understand what might be going on with a certain entity, whether it's some type of a nursing home or a corporate bond or anything like that.
CHUCK BROWN: Hey, Tom, anything to add there?
THOMAS MACIULA: No, I think-- well, the one thing I did mention. When you do the analytics report it, it will indicate if the bond's been upgraded or downgraded. So if you get that kind of notice, it's a good idea to do a little more research and find out what the cause may be.
CHUCK BROWN: Yeah, and credit and liquidity is a tricky, very fluid situation in the bond market. What may be great today could change down the road. But many times we'll talk about sectors and types of municipals that have a history of performing better than others. But again, there's no guarantee that that's going to remain the case for the term of the bond. But again, the team is very well tenured in how the credits work and can talk out some points.
BRAD HANSON: Along those lines, I see another question here, Chuck, and I think this blends in well with this question about whether a company is going-- when they're going through a merger or anything like that. So do we help when a bond, when it gets called away early or when the company goes through a merger?
We can definitely help you out. Maybe there's a tender offer, active tender offer. We can help you. There's going to be the language of the tender offer, and we can help you read into what that language. We've seen a lot of these tender offers. We've seen a lot of these corporate actions. We can help you understand what it says type of thing. So we definitely can help out there.
We'll stop short of telling you what we might recommend you should do, but we can-- a lot of times, a tender offer, there's two ways to view a tender offer. Sometimes, especially with a corporate tender offer, maybe it's not in your best interest, but a lot of times, if the tenders coming in one point, two point, three points above where the bonds are trading at, we're going to help you identify that, hey, this is above the market. We can help you look at the trade history and evaluate if this is a good deal.
And then more importantly, if you accept the tender, there's something you want to do, you have to think about reinvesting those proceeds. So we're going to get that takeout yield. So going to help you evaluate all the little steps of the tender offer. So maybe the bond has a 10 year maturity and it's three points above the market, but that's only 5 or 10 basis points of yield that they're taking you out at. But you have to go and reinvest those proceeds, and we'll take a look at what else might be out there. And so maybe it's best to hang on to the bonds. But we can take you through all those evaluation points.
CHUCK BROWN: Good. Tom, anything you want to add to that?
THOMAS MACIULA: No, that's a good recap for sure.
CHUCK BROWN: OK, great. Well, let me just wind this up by asking what should clients take away from this presentation? I sort of covered a couple of those through the key takeaways, but the high net worth bond desk is a unique model. It's especially in unique on the street. I think a lot of competitors out there have a different model where your advisor is a generalist, and they'll help you with asset allocation, they'll help you with fixed income, they'll help you with ETF.
At Fidelity, Brad mentioned we have the hub and spoke model. And I'm a firm believer in the hub and spoke model in the sense that your advisor at Fidelity is the hub. He will be the general practitioner in your portfolio. But when you need surgery, when you need something specific like fixed income, I think that's where we come in and we specialize.
I always mention the fact that if my parents were ever going to have open heart surgery, I don't think I'd want it from a generalist. I would want it from a specialist. And I think that's what this model provides is that specialized, personalized attention that Fidelity believes in. So I just wanted to end with that.
And I want to thank-- first of all, let me thank Tom and Brad for joining us today. But I also want to thank everybody who joined on the webinar today. If you have any questions, reach out to your Fidelity representative or, of course, call the 800 number that's at the end of the presentation, and our fixed income investment solution representatives can certainly help out. Thank you very much. Have a great day.