Company: WLTH
Filing Date: 2025-06-18
Form Type: DRS
Source: 0001628279-25-000372
Chunk: 13

Company: WEALTHFRONT CORP
Filing Date: 2025-06-18
Form: DRS
Chunk 13
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 S&P 500; and

• In late February 2025, the announcement of tariffs and the potential for a trade war, higher-than-anticipated inflation data, and a sharp repricing of interest rate expectations led to an approximate 10% decline in the S&P 500.

We have also effectively managed multiple periods of interest rate volatility, including:

• In 2013, comments from the then-Federal Reserve Chairman, Ben Bernanke, regarding the potential tapering of asset purchases led to a sharp rise in interest rates, causing market volatility as investors reassessed the implications for future monetary policy;

• Between 2015 and 2018, the Federal Reserve’s gradual increases in interest rates, intended to normalize monetary policy in the wake of the financial crisis, created fluctuations in bond yields and equities as investors adjusted to higher borrowing costs;

• In March 2020, the Federal Reserve’s emergency rate cuts to combat the economic fallout from the pandemic resulted in substantial interest rate volatility; and

• Throughout 2021 and 2022, rising inflation expectations and supply chain disruptions in the wake of the COVID-19 pandemic, led to fears of tighter monetary policy. As the Federal Reserve signaled a shift to combat inflation, interest rate volatility increased as markets anticipated rate hikes.

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• Beginning in March 2022, as inflation proved much less transitory than initially expected, the Federal Reserve initiated a series of aggressive interest rate hikes to combat surging inflation, reaching levels not seen since 2007. Despite these efforts, inflation remained remarkably stubborn, leading to an extended period of elevated interest rates as the Federal Reserve sought to rein in persistent price increases.

Despite shifting macroeconomic conditions, our cash management and investing assets have demonstrated consistent and continuous growth. This resilience was particularly evident during the COVID-19 market downturn in March 2020 and the subsequent period of elevated interest rates in 2022 as well as the financial instability following the failure of Silicon Valley Bank and collapse of First Republic Bank in 2023.

Our Clients Establish Long-Term, Recurring Relationships with Wealthfront

We build long-term relationships with our clients. As of January 31, 2025, more than 20% of clients had recurring or direct deposits. As our clients’ net worth continues to accumulate, we continue to capture a larger portion of their income. For the fiscal quarter ended January 31, 2025, the average monthly recurring deposit amount per client with one or more deposits deemed recurring in that month