#1

What does Kokua mean?

Kokua is a Hawaiian word which loosely translates to "assistance, aid, help".

We believe it is an appropriate name for an entity striving to provide a high level of service, support, and counsel to our clients.

#2

Who is your regulator?

Our primary regulator is the Hawaii Department of Commerce and Consumer Affairs, because our “headquarters” is in Hawaii. We were granted registration in Hawaii in January 2020 following our relocation from Chicago to Honolulu.

We are also registered in North Carolina, Illinois, and Texas.

We were most recently audited by the Hawaii Department of Commerce and Consumer Affairs in the spring of 2021 and were previously audited by the Illinois Secretary of State in July 2017.

Generally, investment adviser firms with less than $100 million in assets under management are regulated by the state in which their primary office resides. Firms in excess of $100 million in assets under management are normally regulated by the SEC.

Our publicly available regulatory filings (ADV Part 1) are available on the SEC's website at http://www.adviserinfo.sec.gov. Once there, you can search for our firm name Kokua Capital Management in zip code 96817.  Furthermore, per SEC regulations, we will also deliver you our Privacy Policy as well as Part 2 of our ADV prior to you becoming a client.

#3

How are you compensated? Are you a fiduciary?

We ARE a fiduciary - this means we are legally required to put our clients' interests ahead of our own. (To be honest, we can’t imagine doing business any other way.) Our only source of compensation from clients is the asset management fee we charge our clients on a quarterly basis, which is assessed as a percentage of assets under management.

We believe this business model aligns our interests with those of our clients. Under our compensation structure, if we grow our clients' assets more, we are entitled to bill our clients more. Likewise, in a bear market, if we do a superior job of protecting & preserving our clients' assets, our revenue will be higher than it otherwise would be.

While many others in our industry are compensated on a per-trade basis (commissions), we believe that often incentivizes unnecessary trading and makes it difficult for clients to understand how much they are ultimately paying their advisor. We also believe that commission-based sources of revenue such as variable annuities often create misaligned incentives.

Our clients frequently pay a modest transaction fee on our trades, but this goes to the custodian as its compensation for making sure the securities and cash are properly exchanged, holding & safeguarding the securities, and fulfilling its recordkeeping and tax-reporting requirements.

Finally, because we do all of our investment research in-house, we nearly eliminate the layers of fees common at many other advisors who outsource large portions of the investment management process. For a small percentage of our portfolios, we utilize mutual funds, exchange traded funds, closed-end funds, and structured notes, all which have fees embedded in them. But because direct ownership of stocks and bonds represents the vast majority of our client portfolios, we are able to keep these additional fees to a minimum.