How We Are Compensated

J.J.B Hilliard, W.L. Lyons, LLC (“Hilliard Lyons”) offers both traditional brokerage accounts and advisory accounts. Fees and services vary based on whether the accounts are brokerage or advisory and in the case of advisory accounts, the nature of the advisory program. Your financial consultant receives a portion of the fees or commissions that Hilliard Lyons receives and therefore has an incentive to recommend products and services to you.
Traditional Brokerage Accounts:
Hilliard Lyons is a full-service broker-dealer. At your direction, we will buy or sell a wide variety of securities including mutual funds, UITs, annuities, ETFs, stocks, and bonds. We provide you with trade confirmations after all purchases and sales and provide account statements monthly if there is activity, and quarterly if no activity.   Hilliard Lyons does not act as a fiduciary within the meaning of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) with respect to brokerage accounts. 
We receive compensation in connection with the services described above. In the case of open-end mutual funds, customers pay “sales loads.” In the case of equity trades, the compensation is in the form of commissions and determined by the nature of the security and the trade. Commissions are shown on the trade confirmations. Fixed income trades generally have a mark up or mark down of up to 3% depending on the nature of the security and the trade. Information regarding our order routing practices, including payment for order flow in the case of options trading, can be found on our website at www.hilliard.com.
Advisory Accounts:
Information regarding fees and services can be found in Hilliard Lyons Form ADV disclosure brochure, a copy of which is available at www.adviserinfo.sec.gov, upon request, or when you open an advisory account. Generally investment management fees for all advisory programs are based upon the market value of the account, including cash, as of the close of business on the last trading day of the preceding quarter. Fees are charged on a quarterly basis in advance. More detail is provided in the ADV disclosure brochure. Hilliard Lyons acts as a fiduciary under ERISA with respect to your advisory accounts, although the nature of the fiduciary services provided depend on the account type.
Mutual Funds:
In the case of both brokerage and advisory accounts, Hilliard Lyons may also receive revenue sharing, as well as distribution, shareholder servicing or networking fees, directly or indirectly, from the mutual funds held in the accounts. Please refer to “Understanding Mutual Funds” brochure for more detail on fees paid and received in connection with mutual fund purchases. In addition, Hilliard Lyons and its financial consultants may, from time to time, receive non-cash compensation from mutual fund companies, investment managers, insurance companies and sponsors of products we distribute in the form of occasional gifts, meals, tickets or other entertainment, sponsorship support of training events for our employees and various forms of marketing support.
During 2014, these mutual fund sponsors made sponsorship payments to Hilliard Lyons of up to $60,000: American Funds, First Trust, LoCorr Funds, PIMCO, and Russell Investments. In addition as of December 31, 2014, these mutual fund sponsors made revenue sharing payments of up to 20 basis points (0.20%) on gross sales to Hilliard Lyons: American Funds, Columbia Funds, Federated Funds, Franklin Templeton, Hartford Funds, and John Hancock. 
Unit Investment Trusts (UITs):
Hilliard Lyons receives compensation in the form of a sales charge that customers pay to purchase a UIT in a traditional brokerage account. In the case of both brokerage and advisory accounts, Hilliard Lyons may also receive additional sales concession based on total volume purchases of primary market UITs. In addition, Hilliard Lyons and its financial consultants may, from time to time, receive non-cash compensation from UIT providers in the form of occasional gifts, meals, tickets or other entertainment, sponsorship support of training events for our employees and various forms of marketing support.
During 2014, this UIT provider made sponsorship payments to Hilliard Lyons of up to $60,000: First Trust.
Exchange Traded Funds:
Hilliard Lyons receives compensation for the sale of exchange traded funds (“ETFs”) in the form of a commission charged on purchases in a traditional brokerage account. In addition, Hilliard Lyons and its financial consultants may, from time to time, receive non-cash compensation from ETF providers in the form of occasional gifts, meals, tickets or other entertainment, sponsorship support of training events for our employees and various forms of marketing support.
During 2014, these ETF providers made sponsorship payments to Hilliard Lyons of up to $60,000: First Trust and PIMCO.
Annuity Products:
Hilliard Lyons receives compensation in the form of commissions and revenue sharing from insurance companies. In addition, Hilliard Lyons and its financial consultants may, from time to time, receive non-cash compensation from insurance companies in the form of occasional gifts, meals, tickets or other entertainment, sponsorship support of training events for our employees and various forms of marketing support.
During 2014, these insurance companies made sponsorship payments to Hilliard Lyons of up to $35,000: Jackson National and Lincoln Financial. In addition as of December 31, 2014, these annuity sponsors made revenue sharing payments to Hilliard Lyons: Nationwide, Jackson National, Pacific Life, Sun America, and Forethought. 
Insurance
Hilliard Lyons receives compensation for the sale of life, long term care and disability insurance.
In addition, there are charges for ancillary account services as set forth in the Hilliard Lyons Fee Schedule, a copy of which is available from your Financial Consultant upon request.