Company: WLTH
Filing Date: 2025-09-23
Form Type: DRS/A
Source: 0001524566-25-000011
Chunk: 207

Company: WEALTHFRONT CORP
Filing Date: 2025-09-23
Form: DRS/A
Chunk 207
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 we charge for investment advisory and portfolio management services. Our investment advisory fees are calculated by multiplying our advisory fee, typically 0.25%, by the market value, less fee waivers, of assets held in client accounts. Costs primarily consist of clearing and execution, money movement, tax reporting, client account maintenance, and individual retirement accounts’ custodial expenses. For fiscal 2024, fiscal 2025, and the six months ended July 31, 2025, revenue from our investment advisory products constituted approximately 26%, 24%, and 24% of our total revenue, respectively. For additional information about our investment advisory products, see the sections titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Components of Results of Operations” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—The Unique Economics and Compounding Growth Model of Wealthfront—Our Revenue Model.”

• Borrowing and Lending

We offer clients with a minimum account balance of $25,000 a simple, fast, and low cost way to borrow cash against up to 30% of the securities in their eligible accounts using a PLOC. We offer PLOC to clients through our omnibus margin lending arrangement with RBC Clearing & Custody, which is subject to customary industry terms. RBC Clearing & Custody extends loans to Wealthfront Brokerage LLC, which then lends these funds to Wealthfront Brokerage LLC clients. Wealthfront Brokerage LLC provides client securities as collateral for such loans and is charged interest by RBC Clearing & Custody on the overall balance of margin loans taken out by clients. As of September 1, 2025, our borrowing rates are among the lowest in the industry, currently 1.08% above the prevailing EFFR, and provide an economical liquidity solution to our clients. We generate revenue from the interest clients pay on the overall balance of their margin loans, less the interest charged by RBC Clearing & Custody described above.

25 Based on extensive academic research, including that relating to Modern Portfolio Theory as described by Harry Markowitz in his 1952 paper Portfolio Selection.

26 In any given tax year, individual harvested capital losses (short- and long-term) can be used to offset capital gains (short- and long-term) in any amount for such individual, while excess losses may be used to offset ordinary income up to a maximum of $3,000 in any given tax year. Any excess losses beyond the annual cap may be carried forward for the life