trg form adv part 2a (“brochure”) - trg cap capital_management - a… · trg added a new...

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TRG FORM ADV PART 2A (“BROCHURE”)

.

8321 SIX FORKS RD, SUITE 103

RALEIGH, NC 27615

919-239-4163

Website: www.trgcap.com

This brochure provides information about the qualifications and business practices of TRG Capital

Management, Inc. (“TRG”). If you have any questions about the contents of this brochure, please contact

us at 919-239-4163 or 607-217-4146. The information in this brochure has not been approved or verified

by the United States Securities and Exchange Commission or by any state authority.

Additional information about TRG also is available on the SEC’s website at www.adviserinfo.sec.gov.

Registration does not imply any level of skill or training

March 25, 2015

www.trgcap.com

http://www.adviserinfo.sec.gov/

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FORM ADV PART 2A (“BROCHURE”)

SUMMARY OF MATERIAL CHANGES

The following material changes have occurred since TRG filed its last annual update to Form ADV Part 2

on March 28, 2014:

Advisory Business

TRG revised its Discretionary Services to disclose that it manages assets that are “held away”,

defined as accounts not held with our recommended custodian, TD Ameritrade.

TRG added a new undiversified discretionary management service (DEEP portfolio series) that

invests in a focused group of individual stocks.

Assets under management have been updated as of February 28, 2015.

Fees and Compensation

TRG added a new management fee schedule that applies to the DEEP portfolio series.

TRG instituted changes to its investment management fee schedule for new Separately Managed and

Held Away Accounts and removed the Enhanced Income and Capital Appreciation strategies for new

clients.

TRG added language describing in more detail how management fees on Separately Managed and

Held Away Accounts are paid.

TRG added disclosure stating that the firm bills on assets held away, including the process for

receiving fees where the held away account cannot be charged directly.

TRG added language clarifying how it charges fees for non-discretionary services.

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Custody

TRG added language which states it has been deemed to have custody for assets in the TRG Dynamic

Risk Manager-Level 2 Fund, l.P. and that an annual surprise audit is now conducted on the assets in

the Fund.

Part 2B (Brochure Supplement)

This was edited to reflect current advisory staff.

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Table of Contents

Advisory Business ..................................................................................................................... 5

Fees and Compensation. ............................................................................................................ 6

Performance-Based Fees and Side-By-Side Management ........................................................ 9

Types of Clients ....................................................................................................................... 10

Methods of Analysis, Investment Strategies and Risk of Loss ............................................... 10

Disciplinary Information ......................................................................................................... 12

Other Financial Industry Activities and Affiliations ............................................................... 12

Code of Ethics, Participation or Interest in Client Transactions and Personal Trading .......... 12

Brokerage Practices ................................................................................................................. 13

Review of Accounts ................................................................................................................ 15

Client Referrals and Other Compensation ............................................................................... 15

Custody .................................................................................................................................... 15

Investment Discretion .............................................................................................................. 16

Voting Client Securities .......................................................................................................... 16

Financial Information .............................................................................................................. 16

Requirements for State-Registered Advisers………………………………………………... .16

Brochure Supplement(s)… …………….....………………………………………Appendix A

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Advisory Business

General Information

TRG, a New York corporation, was organized in February 2008 and began providing investment advisory

services to its clients in April 2008. TRG’s advisory services include discretionary portfolio management

services, non-discretionary portfolio management and/or consulting services, and portfolio management

for privately offered funds. In providing investment advisory services to clients, TRG will tailor its

advisory services to client needs, and may agree to restrictions on investing in certain securities or types of

securities if requested.

Discretionary Services

When acting as a discretionary investment adviser, TRG will have the authority to supervise and direct

client portfolios without prior consultation with the client.

Discretionary Services for TRG Dynamic Elite Equity Portfolios (‘DEEP”). For clients selecting TRG’s

undiversified discretionary services, TRG will construct a portfolio consisting exclusively of individual

equity securities. The number of securities purchased will be 10, 25, or 35 and will be determined by the

minimum client investment and any potential future investments. All accounts using this service must be

held by our recommended custodian, TD Ameritrade. Any deviation from this requirement is at the

discretion of TRG. You can find more information about TD Ameritrade under the Brokerage Practices

section on Page 11. TRG will not be responsible for determining the client’s investment objective or risk

profile under this service.

Discretionary Services for Separately Managed and Held Away accounts. For clients selecting TRG’s

diversified discretionary services, TRG will analyze client portfolios and determine an allocation of equity

securities (e.g., stocks), fixed income securities (e.g., bonds) and alternative investment strategies, and will

select specific securities to be purchased, consistent with the client’s investment objective and risk profile.

Accounts identified as Separately Managed Accounts are those held by our recommended custodian, TD

Ameritrade. You can find more information about TD Ameritrade under the Brokerage Practices section

on Page 11. Accounts identified as Held Away are those held by a custodian other than TD Ameritrade.

In most (but not all) instances the client does not have a choice as these are typically retirement plan

accounts for whom the custodian is selected by the Employer and/or Plan Sponsor. TRG may invest assets

in the client’s portfolio directly into stocks or bonds, or into pooled investment funds (e.g., mutual funds or

ETFs) that invest in stocks, bonds or other securities.

Discretionary Services to Privately Offered Funds. TRG currently provides discretionary investment

advice to the TRG Dynamic Risk Manager-Level 2 Fund, L.P. (“Fund”) in accordance with the Fund’s

investment objective and strategy as described in the Fund’s offering documents. Victoria Park, LLC, a

Delaware limited liability company and an affiliate of TRG, acts as the general partner of the Fund (the

“General Partner”). Investment in the Fund is limited to persons that meet the definition of

accredited investor in accordance with Rule 501(a) of Regulation D of the Securities Act of 1933.

The Fund’s investment objective is to achieve capital appreciation while protecting against downside

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losses and providing potential for dividend income. The Fund seeks to achieve its investment objective by

purchasing equity positions (e.g., common stocks) while implementing certain risk management

techniques designed to limit downside losses. The Fund primarily focuses on purchasing equity positions

with a concentration on large capitalization (greater than $10 billion) companies. The Fund may also

invest in mid-capitalization (between $2 billion and $10 billion) and small-capitalization (between $300

million and $2 billion) companies. The Fund may hold securities of U.S. or foreign issuers, without

limitation, and the Fund’s portfolio may be concentrated in securities of a few issuers, industries, business

segments at any given time.

The methods used by TRG to determine which securities should be purchased for a client portfolio are

described below under “Methods of Analysis, Investment Strategies and Risk of Loss”.

Non-Discretionary Services

Clients who choose a non-discretionary arrangement may receive investment recommendations and other

advisory services from TRG, pursuant to the terms of the respective client’s investment advisory

agreement. In a non-discretionary arrangement, the client retains the responsibility for the final decision

on all actions taken with respect to the client’s account.

Principal Owners

Thomas Gasper is the principal owner and President and Chief Investment Officer of TRG. Please see

“Brochure Supplement(s)”, Appendix A, for more information on Mr. Gasper.

Type and Value of Assets Currently Managed

As of February 28, 2014, TRG had approximately $43,700,000 in assets under management on a

discretionary basis and approximately $1,440,000 in assets under management on a non-discretionary

basis.

Fees and Compensation.

General Fee Information

Fees paid to TRG are exclusive of all custodial and transaction costs paid to the client’s custodian, brokers

or other third party consultants. Each client should review fees charged by TRG and others as reflected in

their quarterly account statements to fully understand the total amount of fees paid by the client for

investment and financial-related services. Additional information related to brokerage is set forth below

under “Brokerage Practices”.

Portfolio Management Fees for TRG Dynamic Elite Equity Portfolios

The current annual fee schedule and investment requirements for our DEEP series, based on a percentage

of assets under management, is as follows:

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TRG STRATEGY DEEP 10 DEEP 25 DEEP 35

NAME PORTFOLIO PORTFOLIO PORTFOLIO

Fee on first $25,000 of

account value

Year 1 - 0%,

Year 2+ - 0.40%

Year 1 - 0%,

Year 2+ - 0.40%

Year 1 - 0%,

Year 2+ - 0.40%

Fee on amount over $25,000

of account value Year 1+ - 0.40%, Year 1+ - 0.40%, Year 1+ - 0.40%,

Minimum Initial Investment $25,000.00 $75,000.00 $175,000.00

Minimum subsequent

Investment $25,000.00 $50,000.00 $75,000.00

Please note that Year 1 for the 0% fee on the first $25,000 of account value shall begin on the date that

TRG begins managing the portfolio and continue through the end of the 4th full quarter of management.

As an example, a client whose management date begins on 12-1-2014 would not be charged a fee on the

first $25,000 of account value through 12-31-2015, after which time the entire account value would be

billed at 0.40% per year.

Portfolio Management Fees for Separately Managed and Held Away accounts

The current annual fee schedule for total portfolio management, based on a percentage of assets under

management, is as follows:

RISK RISK

BUY & HOLD MANAGER MANAGER

TRG STRATEGY TRADITIONAL LEVEL 1 LEVEL 2

NAME PORTFOLIO PORTFOLIO PORTFOLIO

ANNUAL FEE 0.40% 1.50% 2.00%

MINIMUM QUARTERLY FEE $50.00 $375.00 $500.00

We are required by certain state regulations to disclose that, for the Risk Manager Level 2 Portfolio, clients

may find less expensive investment management alternatives elsewhere. TRG feels that the fees charged

are reasonable based on the risk and active management techniques employed for this Portfolio. For

clients that desire a lower management fee TRG offers other portfolio choices. If a client does not indicate

an investment management strategy, TRG will automatically place them in the lowest cost strategy and

maintain that strategy until the client directs us otherwise.

The minimum quarterly fee shown above for Separately Managed and Held Away accounts is calculated

based on a minimum portfolio value of $50,000 for the Buy and Hold Traditional Portfolio and $100,000

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for all other Portfolios. TRG may, at its discretion, make exceptions to the foregoing or negotiate special

fee arrangements or portfolio minimums and annual fee minimums where TRG deems it appropriate under

the circumstances.

Existing clients may be paying higher or lower fees than outlined in this section. Portfolio management

fees are payable quarterly in advance. The fee will be a percentage of the market value of all assets in the

Account(s) on the last trading day of the calendar year quarter. If portfolio management begins after the

start of a quarter fees will be prorated based on the number of days the Account(s) were opened during the

quarter. Should any Fund Flows (contributions or withdrawals) occur during a quarter, fees will be

prorated the following quarter based on the number of days those amounts were on deposit during the prior

quarter. Fees are normally debited directly from client accounts by the client’s custodian. For accounts

held away, if direct debiting of fees is not available the client will either (a) authorize TRG to debit fees

from an account(s) held with TD Ameritrade or (b) pay the fees directly to TRG upon invoicing.

Fees for Non-Discretionary Services

Clients choosing this arrangement will generally be charged an hourly rate at a maximum of $250.00 per

hour, billed in 15 minute increments. TRG will only bill for these services when and if the adviser

consults with the client.

Portfolio Management Fees for the Fund

The annual portfolio management fee for the Fund managed by TRG for clients that meet the minimum

investment of $500,000 is as follows:

DYNAMIC

STRATEGY RISK MANAGER

YEAR LEVEL 2

1 1.30%

2 0.90%

3+ 0.50%

Clients that make an initial commitment of assets of $7,500,000 or greater to the Dynamic Risk Manager

Level 2 Fund managed by TRG will be subject to the following schedule:

INITIAL COMMITMENT LEVEL FEE SCHEDULE

$7,500,000 - $14,999,999 Starts on Strategy Year 2

$15,000,000 and greater Starts on Strategy Year 3

The minimum value for clients invested in the Fund is generally $500,000. TRG may, at its discretion,

make exceptions to the foregoing or negotiate special fee arrangements or portfolio minimums and annual

fee minimums where TRG deems it appropriate under the circumstances. Clients that do not meet the

$500,000 minimum investment in the Fund may be charged a management fee of up to 1.3% while the

investment in the Fund remains below $500,000.

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Existing clients may be paying higher or lower fees than outlined in this section. Portfolio management

fees are generally payable quarterly, in advance. If portfolio management begins after the start of a

quarter, or if contributions or withdrawals occur after an account has been billed for the upcoming quarter,

fees will be prorated and adjusted accordingly. Fees are normally debited directly from client accounts by

the client’s custodian.

Termination if Investment Management Agreement

Either TRG or the client may terminate the client’s investment advisory agreement upon five days’ written

notice. If the agreement is terminated within 5 business days of inception the client will be entitled to a

full refund of any compensation paid to TRG in advance. In the event of termination after 5 business days

of inception, fees will be prorated from the first day of the calendar quarter up to and including the date

TRG receives written notice from the client. Any paid but unearned fees will be promptly refunded to the

client within 3 business days.

Performance-Based Fees and Side-By-Side Management

The General Partner, an affiliate of TRG, may receive a performance fee allocation of the net profits

earned by each investor in the Fund. The performance fee allocation is dependent on the risk management

option chosen as follows:

DYNAMIC

RISK MANAGER

LEVEL 2

YEAR PERFORMANCE FEE

1 5%

2 10%

3+ 15%

Clients that do not meet the $500,000 minimum investment in the Fund may be subject to a performance

fee allocation of up to 15% while the investment in the Fund remains below $500,000.

Performance fee allocations are generally made on a quarterly basis. This arrangement may provide an

incentive for TRG to make investments that are riskier or more speculative than would be the case in the

absence of a performance allocation. This risk is mitigated by the fact that TRG seeks to maximize the

performance of the Fund over time. In addition, the Fund is also subject to a loss carry forward provision

(often referred to as a “high water mark”). This means that if an investor’s interest in the Fund declines in

value and subsequently regains that loss, no performance allocation is assessed until losses have been

recovered.

As discussed above, in addition to accounts from which the General Partner receives a performance

allocation, TRG advises other accounts that pay asset-based or flat fees. While TRG may have an incentive

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to favor accounts that pay performance-based fees, TRG seeks to allocate limited investment opportunities

that suit the investment strategies of more than one account in an equitable manner over time.

Types of Clients

TRG offers investment advisory services to individuals, businesses, pension and profit sharing plans,

charitable organizations, pooled vehicles (including the Fund) and various types of entities.

Methods of Analysis, Investment Strategies and Risk of Loss

Methods of Analysis and Investment Strategies

TRG manages portfolios focusing in specific asset classes such as fixed income (e.g., certificates of

deposit, bonds or mutual funds), equities (e.g., stocks, mutual funds or ETFs) or alternative investment

strategies (e.g., options), or in multiple asset classes for diversification purposes. TRG will develop

portfolios for clients seeking growth, income or a blend of both by focusing on “Fundamental Analysis”

and/or “Technical Analysis” to identify and evaluate attractive investment opportunities.

Fundamental Analysis – without limitation, TRG will generally consider the following fundamental

factors when recommending securities for client accounts:

Dividend Yields

Price-to-Earnings Ratios

Forward Performance Guidance

News-Driven Events

Economic / Industry Analysis

Technical Analysis – without limitation, TRG will generally consider the following technical factors

when recommending securities for client accounts:

Price Related Moving Averages

Volume / Momentum Indicators

“Breakouts” (above price resistance) and “Breakdowns” (below price support)

Oversold / Overbought chart patterns (prices moved too fast or far in either direction)

Risk of Loss

While TRG may seek to diversify clients’ investment portfolios, all investment portfolios are subject to

risks. Accordingly, there can be no assurance that client investment portfolios will be able to fully meet

their investment objectives and goals, or that investments will not lose money. Below is a description of

several of the principal risks that client investment portfolios may face.

Management Style Risks. While TRG manages client investment portfolios based on TRG’s experience,

research and proprietary methods, the value of client investment portfolios will change daily based on the

performance of the underlying securities in which they are invested. Accordingly, client investment

portfolios are subject to the risk that TRG’s investment style is out of favor in the market.

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Risks Related to Equity Investments

Equity Market Risks. TRG will invest portions of client assets directly into equity investments or

into pooled investment funds that invest in the stock market. Risks related to investments in

equity markets include, without limitation, the risks that stock values will decline due to daily

fluctuations in the markets, and that stock values will decline over longer periods (e.g., bear

markets) due to general market declines in the stock prices for companies, regardless of any

individual security’s prospects. In addition, as noted above, while pooled investments have

diversified portfolios that may make them less risky than investments in individual securities,

funds that invest in stocks and other equity securities are nevertheless subject to the risks of the

stock market.

Undervalued Companies. TRG may invest client portfolios in companies that TRG considers to

be “undervalued”. The securities of an undervalued company may be depressed in value due to

factors including, but not limited to, disappointments in recent earnings, diminished expectations

regarding earnings, current or expected adverse economic or industry conditions, or a lack of

sufficient investor interest. Investments in securities that in TRG’s opinion are undervalued are

accompanied by a substantial risk of loss because, subsequent to the purchase by TRG, prices for

the purchased securities may decline in value, resulting in material losses for client portfolios on

those investments.

Foreign Securities Risks. TRG may invest portions of client assets into ADRs and ETFs that

invest internationally. While foreign investments are important to the diversification of client

investment portfolios, they carry risks that may be different from U.S. investments. For example,

foreign issuers of securities in which TRG invests may not be subject to uniform audit, financial

reporting or disclosure standards, practices or requirements comparable to those found in the U.S.

Foreign investments are also subject to foreign withholding taxes and the risk of adverse changes

in investment or exchange control regulations. Foreign investments may also involve currency

risk, which is the risk that the value of the foreign security will decrease due to changes in the

relative value of the U.S. dollar and the security’s underlying foreign currency.

Fixed Income Risks. TRG will invest portions of client assets directly into fixed income instruments, such

as bonds and notes, or may invest in pooled investment funds that invest in bonds and notes. While

investing in fixed income instruments, either directly or through pooled investment funds, is generally less

volatile than investing in equity markets, fixed income investments nevertheless are subject to risks. These

risks include, without limitation, interest rate risks (risks that changes in interest rates will devalue the

investments), credit risks (risks of default by borrowers), or maturity risk (risks that bonds or notes will

change value from the time of issuance to maturity).

Risks Related to Options. TRG may invest part or a client’s entire portfolio using option contracts on

individual equities, ETFs or index-tracking securities. Investments in option contracts are price and time

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sensitive and are accompanied by a significant risk that option contract values may fall or become

worthless, resulting in material losses for client portfolios.

Options involve risk and are not suitable for all investors. Prior to buying or selling an option, a person

must receive a copy of Characteristics and Risks of Standardized Options. Copies of this document will be

provided electronically by TRG upon request or by contacting The Options Clearing Corporation, One

North Wacker Dr., Suite 500, Chicago, IL 60606 (1-888-678-4667).

Risks of Investments in Mutual Funds, ETFs and Other Investment Pools. As described above, TRG may

invest client portfolios in mutual funds, ETFs and other investment pools (“pooled investment funds”).

Investments in pooled investment funds are generally less risky than investing in individual securities

because of their diversified portfolios; however, these investments are still subject to risks associated with

the markets in which they invest. In addition, pooled investment funds’ success will be related to the skills

of their particular managers and their performance in managing their funds. Pooled investment funds are

also subject to risks due to regulatory restrictions applicable to registered investment companies under the

Investment Company Act of 1940, as amended.

Disciplinary Information

TRG has no disciplinary events to disclose.

Massachusetts law requires disclosure that information on disciplinary history and the registration of our

firm and its associated persons may be obtained by contacting the SEC’s Office of Investor Education and

Advocacy at (202) 942-8090, Option 6. Disciplinary history may also be obtained from the Massachusetts

Securities Division at (617) 727-3548, and if asked, our firm and its associated persons must also disclose

the history.

Other Financial Industry Activities and Affiliations

Victoria Park, LLC, an affiliate of TRG, serves as the general partner for the Fund.

Code of Ethics, Participation or Interest in Client Transactions and Personal Trading

Code of Ethics and Personal Trading

TRG has adopted a Code of Ethics (the “Code”), the full text of which is available to any current or

prospective client upon request. TRG’s Code has several goals. First, the Code is designed to assist TRG

in complying with applicable laws and regulations governing its investment advisory business. Under the

Investment Advisers Act of 1940, as amended (the “Advisers Act”), TRG owes fiduciary duties to its

clients. Pursuant to these fiduciary duties, the Code requires TRG’s associated persons to act with

honesty, good faith and fair dealing in working with clients. In addition, the Code prohibits associated

persons from trading or otherwise acting on insider information.

The Code also sets forth policies and procedures to monitor and review the personal trading activities of

associated persons. From time to time TRG’s associated persons may invest in the same securities

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recommended to clients. Under its Code, TRG has adopted procedures designed to reduce or eliminate

conflicts of interest that this could potentially cause. The Code’s personal trading policies include

procedures for limitations on personal securities transactions of associated persons, reporting and review of

such trading and pre-clearance of certain types of personal trading activities. The Code also provides for

disciplinary action as appropriate for violations.

Participation or Interest in Client Transactions

TRG is permitted to make investments for its own accounts, including investments competitive with those

of its clients, without having or incurring any obligation to disclose or to offer any such interest in such

activities to clients. However, in the event of other identified potential trading conflicts of interest, TRG’s

goal is to place client interests first. If associated persons participate in trades with client accounts (e.g., in

a bundled or aggregated trade), and the trade is not filled in its entirety, the associated person’s shares will

be removed from the block, and the balance of shares will be allocated among client accounts.

Brokerage Practices

Selection of Broker and Custodian

TRG may recommend TD Ameritrade to its Clients for custody and brokerage services. TD Ameritrade is

an independent SEC-registered broker-dealer and member FINRA/SIPC/NFA. TRG is independently

owned and operated and not affiliated with TD Ameritrade. TD Ameritrade offers to independent

investment Advisors services which include custody of securities, trade execution, clearance and

settlement of transactions. While we may recommend that you use TD Ameritrade, you will decide

whether to do so by completing TD Ameritrade’s account application and agreement. We will assist you

with this process if you so choose.

TRG participates in the TD Ameritrade Institutional customer program and receives some benefits from

TD Ameritrade through its participation in the program. There is no direct link between TRG’s

participation in the program and the investment advice it gives to its Clients, although TRG receives

economic benefits through its participation in the program that are typically not available to TD

Ameritrade retail investors. These benefits include the following products and services (provided without

cost or at a discount):

receipt of duplicate Client statements and confirmations;

research related products and tools;

consulting services;

access to a trading desk serving TRG participants;

access to block trading (which provides the ability to aggregate securities transactions for

execution and then allocate the appropriate shares to Client accounts);

the ability to have TRG’s management fees deducted directly from Client accounts;

access to an electronic communications network for Client order entry and account information;

access to mutual funds with no transaction fees and to certain institutional money managers;

discounts on compliance, marketing, research, technology, and practice management products or

services provided to TRG by third party vendors.

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TD Ameritrade may also have paid for business consulting and professional services received by TRG’s

related persons. Some of the products and services made available by TD Ameritrade through the

program may benefit TRG but may not benefit its Client accounts. These products or services may assist

TRG in managing and administering Client accounts, including accounts not maintained at TD

Ameritrade. Other services made available by TD Ameritrade are intended to help TRG manage and

further develop its business enterprise. The benefits received by TRG or its personnel through

participation in the program do not depend on the amount of brokerage transactions directed to TD

Ameritrade. As part of its fiduciary duties to clients, TRG endeavors at all times to put the interests of its

clients first.

Clients should be aware, however, that the receipt of economic benefits by TRG or its related persons in

and of itself creates a potential conflict of interest and may indirectly influence the TRG’s choice of TD

Ameritrade for custody and brokerage services.

Brokerage Costs

If your account is maintained at TD Ameritrade (or another qualified custodian) they will be compensated

by charging you commissions or other trading costs on trades that it executes on your behalf. TRG does

not share in any fees or costs assessed by the qualified custodian, which are separate from the portfolio

management fees charged by TRG.

Best Execution

When given discretion to select the brokerage firm that will execute orders in client accounts, TRG seeks

“best execution” for client trades, which is a combination of a number of factors, including, without

limitation, quality of execution, services provided and commission rates. In making these determinations,

TRG considers a number of judgmental factors, including, without limitation, clearance and settlement

capabilities; quality of confirmations and account statements; the ability of the broker to settle the trade

promptly and accurately; the financial standing, reputation and integrity of the broker-dealer; the broker-

dealer’s access to markets, research capabilities, market knowledge, any “value added” characteristics, and

TRG’s past experience with the broker-dealer, TRG’s past experience with similar trades, and other

factors. Recognizing the value of these factors, TRG may pay a brokerage commission in excess of that

which another broker might have charged for effecting the same transaction. Therefore, TRG may use or

recommend the use of brokers who do not charge the lowest available commission in the recognition of

research and securities transaction services or quality of execution.

Soft Dollar Transactions

TRG does not engage in soft dollar transactions.

Aggregated Trade Policy

TRG aggregates trades when it believes that aggregation is consistent with its duty to seek best execution

(which includes the duty to seek best price) for its clients, and is consistent with the terms of TRG’s

investment advisory agreement with each client for which trades are being aggregated.

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Trade Error Policy

During the course of its trading activities TRG may cause a trade error to occur. Causes of such errors

include, but are not limited to: the purchase of the wrong security, the purchase of the wrong quantity of a

security, purchasing in the wrong client account, or failure to make a purchase. TRG’s policy is to correct

any trade error as soon as possible and in such a way that the client is made whole. In the event that a

trade error correction results in a loss, TRG will be responsible for payment. In the event that a trade error

correction results in a gain, TRG will either (a) instruct TDA to donate the gain to a charity of their choice

(this is their policy for handling trade error gains) or (b) if the trade was placed outside of TDA credit the

client with the gain.

Review of Accounts

Mr. Gasper, TRG’s Chief Investment Officer, reviews all accounts not less than quarterly. These reviews

focus on appropriateness of the client’s investments for the client’s portfolio and the performance of the

client’s account. More frequent reviews may be triggered by, without limitation, material changes in the

client’s individual circumstances, or by material changes in the current or projected market, political or

economic environment. Mr. Murphy, the CCO, will perform periodic and random account reviews to

ensure that trades for the portfolio are consistent with the overall account objectives.

TRG will provide clients with quarterly reports summarizing account performance, balances and holdings,

income and expenses, as well as a calculation of the management fee charged.

Client Referrals and Other Compensation

TRG may engage solicitors who refer clients to TRG consistent with the requirements of Rule 206-4(3)

under the Advisers Act. TRG currently has a solicitation arrangement in place with Dr. Donald Moine,

DBA Association for Human Achievement, Inc. (“AHA”). Under this arrangement, TRG may pay Dr.

Moine a percentage of the first three years of management fees received from clients Dr. Moine introduces

to TRG.

Custody

All of TRG’s client portfolios are custodied with a qualified custodian. Each client’s custodian is

responsible for providing the client with confirmations of trading activity, tax forms and at least quarterly

account statements, copies of which should be provided to TRG. Clients are advised to review this

information carefully, and to notify TRG of any questions or concerns. Clients are also asked to promptly

notify TRG if a custodian fails to provide statements on each account held.

TRG is deemed to have custody for assets held in the TRG Dynamic Risk Manager-Level 2 Fund, L.P.

(“Fund”) and, as such, has entered into an agreement whereby an independent public accounting firm

conducts an annual surprise audit of the assets in the Fund. This allows us to meet our ongoing regulatory

requirements in this area.

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Investment Discretion

As stated above, TRG has investment discretion over certain client accounts, pursuant to the terms of the

respective client’s investment advisory agreement.

Voting Client Securities

As a policy and in accordance with TRG’s investment advisory agreement, TRG does not vote proxies

related to securities held in client accounts. The custodian of the account will normally provide proxy

materials directly to the client. Clients may contact TRG with questions relating to proxy procedures and

proposals by calling 919-239-4163 or 607-217-4146; however, TRG generally does not research proxy

proposals.

Financial Information

TRG does not require nor solicit prepayment of more than $500.00 in fees per client, six months or more

in advance.

Requirements for State-Registered Advisers

Information regarding the principal officers of TRG, Thomas Gasper and Brian Murphy, including other

business activities, can be found in Appendix A.

TRG currently provides discretionary investment advice to the TRG Dynamic Risk Manager-Level 2

Fund, L.P. (“Fund”) in accordance with the Fund’s investment objective and strategy as described in the

Fund’s offering documents. Victoria Park, LLC, a Delaware limited liability company and an affiliate of

TRG, acts as the general partner of the Fund (the “General Partner”). The General Partner, an affiliate of

TRG, may receive a performance-based fee equal to 5-15% of the net profits earned by each investor in the

Fund. The performance fee calculation is generally made on a quarterly basis. This arrangement may

provide an incentive for TRG to make investments that are riskier or more speculative than would be the

case in the absence of a performance allocation. This risk is mitigated by the fact that TRG seeks to

maximize the performance of the Fund over time. In addition, the Fund is also subject to a loss carry

forward provision (often referred to as a “high water mark”). This means that if an investor’s interest in the

Fund declines in value and subsequently regains that loss, no performance allocation is assessed until

losses have been recovered.

No other disclosures are required under this item.

Appendix – A1

US2008 3357199.3

2013 Brochure Supplement for

Thomas Gasper

TRG CAPITAL MANAGEMENT, INC.


RALEIGH, NC 27615

919-239-4163


March 25, 2013

This brochure supplement provides information about Thomas Gasper, and supplements the TRG

Capital Management, Inc. (“TRG”) brochure. You should have received a copy of that brochure.

Please contact TRG at 919-239-4163 or 607-217-4146 if you did not receive TRG’s brochure, or

if you have any questions about the contents of this supplement.

Additional information about Thomas Gasper is also available on the SEC’s website at

www.adviserinfo.sec.gov.


Appendix – A2

US2008 3357199.3

Educational Background and Business Experience

Date of Birth

January 7, 1965

Education

Associates Degree in Accounting from Broome Community College, 1986

Bachelor of Science in Accounting from Wilkes College, 1987

MBA in Finance and Marketing from Wilkes College, 1988

Business Background

Senior Vice-President and Chief Investment Officer of Columbia Ridge Capital Management,

Inc., November of 2005 to April of 2008

President and Chief Investment Officer of TRG Capital Management, Inc., April of 2008 –present

Professional Certifications/Examinations

NASAA Series 63, Uniform Securities Agent State Law Examination, August 2005*

NASAA Series 65, Uniform Investment Advisor Law Examination, October 2003**

FINRA Series 6, Investment Company and Variable Contracts Products Representative

Examination, October 2005***

Certified Public Accountant (“CPA”)****


Mr. Gasper has no disciplinary events to disclose.

Other Business Activities

Mr. Gasper is not engaged in any other investment-related business or occupation, and does not

earn compensation for the sale of any other products or services.

Additional Compensation

As stated above, Mr. Gasper has no other income or compensation to disclose.

* The Uniform Securities Agent State Law Examination, called the Series 63 exam, is designed to qualify candidates as securities

agents. The examination covers the principles of state securities regulation reflected in the Uniform Securities Act (with the

amendments adopted by NASAA and rules prohibiting dishonest and unethical business practices). **

The Uniform Investment Adviser Law Examination, called the Series 65 exam, is designed to qualify candidates as investment

adviser representatives. The exam covers topics that have been determined to be necessary to understand in order to provide

investment advice to clients. ***

The FINRA Investment Company/Variable Contracts Products Limited Representative Qualification Examination (Series 6) is

used to qualify individuals seeking registration with FINRA under Article III, Section 2 of the NASD By-Laws and applicable

Membership, Registration and Qualification Rules. ****

CPA is the statutory title of qualified accountants in the United States who have passed the Uniform Certified Public Accountant

Examination and have met additional state education and experience requirements for certification as a CPA.

http://en.wikipedia.org/wiki/Statutory

http://en.wikipedia.org/wiki/Accountant

http://en.wikipedia.org/wiki/United_States

http://en.wikipedia.org/wiki/Uniform_Certified_Public_Accountant_Examination

http://en.wikipedia.org/wiki/Uniform_Certified_Public_Accountant_Examination

Appendix – A3

US2008 3357199.3

Supervision

Mr. Gasper, President and Chief Investment Officer, is responsible for the supervision of Brian

Murphy, Chief Compliance Officer (“CCO”). You can contact Mr. Gasper at 919-239-4163. The

CCO has designated Mr. Gasper to act in his absence or unavailability.


Mr. Gasper has no events to disclose under this item.

Appendix – A4

US2008 3357199.3


Brian Murphy

520 COLUMBIA DRIVE, SUITE 107

JOHNSON CITY, NY 13790

607-217-4146



RALEIGH, NC 27615

919-239-4163


September 18, 2013

This brochure supplement provides information about Brian Murphy, and supplements the TRG

Capital Management, Inc. (“TRG”) brochure. You should have received a copy of that brochure.

Please contact TRG at 919-239-4163 or 607-217-4146 if you did not receive TRG’s brochure, or

if you have any questions about the contents of this supplement.

Additional information about Brian Murphy is also available on the SEC’s website at



Appendix – A5

US2008 3357199.3


Date of Birth

October 26, 1961

Education

Studied Finance at Pace University 1979-1981

Completed Certified Financial Planner™ coursework from the American College, 2006

Business Background

Chief Compliance and Operations Officer of TRG Capital Management, Inc., December of 2012-

present

Chief Compliance Officer of Ridgeway & Conger Advisory Services, November of 2010 to

December of 2012

Compliance Officer of Ridgeway & Conger, Inc., November of 2010 to December of 2012

Chief Compliance Officer of Columbia Ridge Capital Management, November of 2005 to June of

2009


FINRA Series 7, General Securities Representative Examination, January 1987**

NASAA Series 63, Uniform Securities Agent State Law Examination, March 1987*

FINRA Series 24, General Securities Principal Examination, December 1987**

Certified Financial Planner™ (“CFP®”)***


Mr. Murphy has no disciplinary events to disclose.


Mr. Murphy is not engaged in any other investment-related business or occupation, and does not


***

The FINRA General Securities Representative and General Securities Principal Examinations are used to qualify individuals

seeking registration with FINRA under Article III, Section 2 of the NASD By-Laws and applicable Membership, Registration and

Qualification Rules. * The Uniform Securities Agent State Law Examination, called the Series 63 exam, is designed to qualify candidates as securities

agents. The examination covers the principles of state securities regulation reflected in the Uniform Securities Act (with the

amendments adopted by NASAA and rules prohibiting dishonest and unethical business practices).

*** The Certified Financial Planner™ certification is issued by the CFP Board to individuals who have completed an advanced college-level course of study, passed a comprehensive 10-hour exam and completed 3 years of qualifying work experience,

Certificants must also complete ongoing continuing education requirements and agree to be bound by the CFP Board’s Standards of

Professional Conduct.

Appendix – A6

US2008 3357199.3


Other than stated above, Mr. Murphy has no other income or compensation to disclose.

Supervision

Mr. Murphy has been designated to serve as TRG’s Chief Compliance Officer (“CCO”) since

December 2012. As the CCO, Mr. Murphy supervises the activities of Thomas Gasper by

periodically reviewing the following aspects of TRG’s client accounts: Client Contracts, Trading,

Allocation of Investment Opportunities, Consistency with Client Objectives and Agency Cross

Transactions. You can contact Mr. Murphy at 607-217-4146. The CCO will designate Thomas

Gasper, President, to act in his absence or unavailability. In addition, the CCO shall submit his

personal trading information (as described in Form ADV Part 2A) to Mr. Gasper, and Mr. Gasper

shall submit his personal trading information to the CCO for review and approval in accordance

with TRG’s Code of Ethics.


Mr. Murphy has no events to disclose under this item.

Appendix – A7

US2008 3357199.3


George Gerner Jr.

520 COLUMBIA DRIVE, SUITE 107

JOHNSON CITY, NY 13790

607-217-4146



RALEIGH, NC 27615

919-239-4163


August 20, 2014

This brochure supplement provides information about George Gerner Jr., and supplements the

TRG Capital Management, Inc. (“TRG”) brochure. You should have received a copy of that

brochure. Please contact TRG at 919-239-4163 or 607-217-4146 if you did not receive TRG’s

brochure, or if you have any questions about the contents of this supplement.

Additional information about George Gerner Jr.is also available on the SEC’s website at



Appendix – A8

US2008 3357199.3


Date of Birth

May 24, 1952

Education

Bachelor of Arts in English and Education, SUNY Oswego, 1974

MS in Computer Science, SUNY Binghamton, 1979

Business Background

Investment Adviser Representative/Director of Marketing, TRG Capital Management, January

2013-present

Program Manager, Lockheed Martin, December 1978-May 2012


NASAA Series 65, Uniform Investment Advisor Law Examination, November 2012**


Mr. Gerner has no disciplinary events to disclose.


Mr. Gerner is not engaged in any other investment-related business or occupation, and does not



Other than stated above, Mr. Gerner has no other income or compensation to disclose.

Supervision

Brian Murphy, Chief Compliance Officer (“CCO”), is responsible for the supervision of Mr.

Gerner. You can contact Mr. Murphy at 607-217-4146.


Mr. Gerner has no events to disclose under this item.

**

The Uniform Investment Adviser Law Examination, called the Series 65 exam, is designed to qualify candidates as investment

adviser representatives. The exam covers topics that have been determined to be necessary to understand in order to provide

investment advice to clients.

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