Calculation & intake on Upvest side

Both service and transaction fees can be implemented via Upvest.

Upvest calculates the fee as a percentage of assets under management (AUM) and charges it to end users based on the frequency of fee collections previously agreed with the client and upon account liquidation.

Prerequisites

The following requirements apply:

To be able to use the fee collection function, Upvest must activate the relevant API endpoints for you.
To collect fees from a cash balance or via cover orders, the user must have an active account group and account.
You can find out more about creating accounts and account groups here.

Implementation steps

In order to implement this setup you will need to perform the following steps:

Define the fee structure
Define the desired fee structure, scope and frequency of the fee intake.
Example:
30 bps (basis points, 1 bps=0,01%), of which 20bps are a service fee and 10 bps are a transaction lump sum fee, taken once a year
Define the fee collection method
To collect the fees, Upvest will issue a sell order by default to cover the fees. For more details, see 'Sell-to-cover order' below.
Further fee collection options can be implemented after consultation with Upvest.
Communication with Upvest
Inform Upvest of the desired fee models and the collection method. You will receive the respective fee model IDs with which you can assign the respective fee models to the individual accounts.
Learn more about fee models here.
Setup the fee configurations
Set up fee configurations for all accounts that need to be debited.
Learn more about fee configuration here.

Upvest provides the ability to update assigned fee configurations via the API, giving you the flexibility to change the user's fee model based on the logic in your system.

Fee collection

Fees will then be charged on the day of the planned fee collection or when the account is closed.

Please note that you can only start a fee collection for accounts that are not in PENDING_APPROVAL or CLOSED status. If the account is in one of these statuses, a Bad Request response code will be returned.
Otherwise, you will receive a fee collection object with the fee collection ID in the response.

If the selected collection strategy is ‘Sell-to-cover’, Upvest triggers the corresponding orders to collect the money. You can recognise orders that are created to cover fees by the initiation_flow value in the order event: SELL_TO_COVER_FEES.

Further details can be found in the section 'Implementation of sell-to-cover orders below.

The fee collection is finalised after the sales order has been processed. You receive an event FEE_COLLECTION.FINALISED. All cash remaining from the sales orders that is not used for fees is available for withdrawal.