Managed Bond Portfolios

What is a Managed Bond Portfolio?

A Managed Bond Portfolio is a professionally managed account that invests in a portfolio of individual bonds for you, based on a strategy you choose. It is a discretionary advisory service offered through Webull Advisors. Your bonds are held in a Separately Managed Account (SMA), so you own the individual bonds in your account. Each portfolio is built and maintained by an automated, algorithm-driven process with oversight from the Webull Advisors investment team.

What account types can hold a Managed Bond Portfolio?

Managed Bond Portfolios are available in taxable advisory accounts, Traditional IRAs, Roth IRAs, and custodial accounts.

How do I open a Managed Bond Portfolio?

You can open a Managed Bond Portfolio in the Webull app by following the steps below:

App:

1. Select the Markets tab at the bottom of the screen.
2. Tap Advisors.
3. Under Investment Path choose the account type that best matches your goal.
4. Under Fixed Income Portfolios, select either the High Income Portfolio or the Enhanced Cash Portfolio.
5. Review the portfolio details and select Continue.
6. Review the account information and select Confirm.
7. Complete the Risk Assessment and any required suitability questions.
8. Review your information and submit your application.

What is the minimum amount to open a Managed Bond Portfolio?

The minimum depends on the strategy you choose:

• Enhanced Cash Portfolio: $500
• High Income Portfolio: $2,000

If you deposit less than the minimum, your cash is held but not invested until the minimum is met. You will receive a notification when this happens.

How do I fund my portfolio?

You can fund your account using an ACH transfer, wire transfer, or an internal transfer from an eligible Webull account. Your Managed Bond Portfolio can be funded once the account has been fully approved and opened.

App:

1. Once your account has been opened, select Add Funds.
2. Choose whether you would like to fund the account via ACH, wire transfer, or an eligible internal transfer.
3. Enter the dollar amount you would like to deposit.
4. Select the funding frequency, including Once, Daily, Weekly, Biweekly, or Monthly.
5. Select Review.
6. Review the deposit details and funding instructions.
7. After reviewing and accepting the deposit disclosures, select Submit to initiate the deposit.

What strategies are available?

Two strategies are available:

• Enhanced Cash Portfolio: a short-term U.S. Treasury strategy focused on liquidity, capital preservation, and modest income. It holds U.S. Treasuries, generally with maturities of two years or less.
• High Income Portfolio: a diversified portfolio of investment-grade and high-yield corporate bonds focused on higher current income and total return. It accepts more credit risk and price movement in exchange for income potential.

Can I choose which bonds are in my portfolio?

No. Managed Bond Portfolios are discretionary accounts. Our investment team determines the universe of bonds eligible for a given strategy, and the individual bond allocation is automated.

Can I manage the bonds myself instead?

Managed Bond Portfolios are discretionary only, which means the bonds are selected and managed for you. If you prefer to choose individual bonds yourself, Webull offers self-directed fixed income trading as a separate service.

How are the bonds selected?

Bond selection and portfolio construction are automated. The system builds each portfolio within the strategy's rules for credit quality, maturity, diversification, and liquidity. Only bonds that meet the strategy's eligibility criteria are included, and the eligible bond list is reviewed regularly by the investment team.

Do I own the bonds in my portfolio?

Yes. Your portfolio is held in a Separately Managed Account, and you are the beneficial owner of the bond positions, including any fractional positions.

How many bonds will my portfolio hold?

It depends on the strategy. The Enhanced Cash Portfolio generally holds 5 to 15 bonds, and the High Income Portfolio generally holds 20 to 50 bonds. These targets may change over time.

What does a Managed Bond Portfolio cost?

Each strategy has an annual advisory fee:

• Enhanced Cash Portfolio: 0.15% per year, with a $1 per month minimum
• High Income Portfolio: 0.30% per year, with a $1 per month minimum

The fee is calculated daily based on the account value and billed monthly. Performance is reported after advisory fees are deducted.

Are there trading commissions or markups?

Webull Advisors does not charge separate trading commissions. For corporate bonds in the High Income Portfolio, Webull Financial may earn a spread on transactions. Treasury securities in the Enhanced Cash Portfolio are traded with no markup. Bonds are also subject to bid-ask spreads, which are reflected in the bond's price.

How is my suitability for a strategy determined?

Suitability is based on two questionnaires. The Risk Tolerance Questionnaire (RTQ) sets your overall risk profile and assigns a risk band. The Suitability Questionnaire (SSQ) covers questions specific to the product. Each strategy is aligned to a range of risk bands. Depending on how your profile aligns with a strategy, you may be approved automatically, asked to confirm an acknowledgment, or asked to answer additional suitability questions.

What happens if I do not complete the suitability questions?

If a strategy requires additional suitability questions based on your profile, you will need to complete them before you can open that strategy.

What are the main risks of a Managed Bond Portfolio?

Bond investments carry several risks, including credit risk, interest-rate risk, liquidity risk, and concentration risk. The Enhanced Cash Portfolio holds Treasuries and carries lower credit and interest-rate sensitivity. The High Income Portfolio accepts higher credit risk and more price movement in exchange for income potential. The value of your portfolio can rise and fall, and you may get back less than you invested.

Are the assets in my account protected?

Securities in your account are protected by SIPC up to $500,000, including up to $250,000 for cash claims, if the brokerage firm fails. SIPC does not cover losses caused by a decline in the market value of your bonds.

How do I fund my portfolio?

You fund your account with cash. Once your balance meets the strategy minimum, your deposit is invested in the next trading cycle. If your balance is below the minimum, your cash is held until the minimum is met.

How do I withdraw money?

You can make a partial withdrawal or withdraw your full balance. The system sells positions within the strategy's guidelines, and your cash proceeds are returned after standard settlement. If a partial withdrawal would bring your account below the strategy minimum, you can choose to keep the minimum balance or withdraw everything and close the account.

Withdrawals may take approximately 3 to 5 trading days to be fully processed, depending on settlement and account rebalancing.

How do I close my account?

When you close your account, your bond holdings are sold and the cash proceeds are returned to you.

Can I switch from one strategy to another?

Yes. When you switch strategies, the system sells your current holdings and builds the new strategy in the next trading cycle.

Can I transfer bonds into or out of a Managed Bond Portfolio?

Transfers of bonds into or out of a Managed Bond Portfolio are not available at this time. To move funds, you can withdraw cash from your account.

What return can I expect?

Returns are not guaranteed and will vary with market conditions. Each strategy is managed toward a target yield premium over its benchmark. The Enhanced Cash Portfolio targets a modest premium over money market rates, and the High Income Portfolio targets a premium over a blended investment grade and high yield corporate bond benchmark. These are objectives, not guarantees of performance.

What yield will I see for my portfolio?

Your portfolio yield is shown as Yield to Worst (YTW). You can view your holdings grouped by maturity or by credit rating.

How is my performance reported?

Performance is calculated as a time-weighted rate of return and reported quarterly. Reports show your return for the quarter, year-to-date, one-year, and since-inception periods, along with a benchmark comparison. Performance is reported after advisory fees.

Are returns or income guaranteed?

No. Neither income nor principal is guaranteed. Your portfolio is subject to market, credit, and interest-rate risk.

When are trades placed?

Trading takes place on regular market days and does not occur on market holidays. When your account is funded or rebalanced, your orders are placed in that day's trading cycle.

How often is my portfolio rebalanced?

There is no fixed rebalancing schedule. Rebalancing happens when there is a reason for it, such as a deposit, a withdrawal, proceeds that need to be reinvested, or a holding that no longer meets the strategy's guidelines.

What happens when a bond matures, is called, or pays interest?

Interest payments, maturity proceeds, and call proceeds are credited to your account and reinvested in the next trading cycle once your cash is above the reinvestment threshold. Bonds are generally held to maturity unless rebalancing requires a sale.

How do I view my holdings?

You can view your portfolio in the Webull app under your Managed Bonds portfolio. Your holdings show details such as the bond name, maturity date, coupon rate, yield to worst, credit rating, and current market value.

What tax documents will I receive?

You will generally receive Form 1099-INT for interest and Form 1099-B for sales from Webull Financial. Tax efficiency is not a factor in how portfolios are managed.