Overview
Heartland Advisors, Inc. (“Heartland”) is an investment
advisory Firm that provides investment management services
to separate account clients, mutual fund portfolios, and
other advisors. Heartland’s predecessor was organized in
1983 in Wisconsin as an investment advisory subsidiary of a
regional brokerage rm, The Milwaukee Company, owned in
part by William (“Bill”) J. Nasgovitz. In 1984, Mr. Nasgovitz
purchased a majority interest of the investment advisory
subsidiary from his partners and started managing
Heartland’s rst mutual fund, the Heartland Value Fund. In
1988, Mr. Nasgovitz and his partners sold The Milwaukee
Company to Dain Bosworth, and in the same transaction Mr.
Nasgovitz acquired the remaining shares of the investment
advisory subsidiary and changed its name to Heartland
Advisors, Inc. In 2000, Heartland was reorganized into a
wholly owned subsidiary of Heartland Holdings, Inc.
Heartland remains an independent Firm 100% owned through
Heartland Holdings, Inc. by its current employees. Heartland
is principally owned by Heartland’s Chief Executive Of cer,
William (“Will”) R. Nasgovitz.
Heartland’s advisory services are typically provided on a
discretionary basis. From time to time, Heartland may
manage client accounts on a non-discretionary basis.
Heartland’s discretionary investment authority is limited by
conditions imposed by clients in their stated investment
objectives or guidelines, or by other instructions provided to
Heartland. Heartland generally requires that all clients
approve the investment objectives and restrictions applicable
to their account by agreeing to the guidelines applicable to a
particular strategy or by providing special instructions. Please
see Item 16: Investment Discretion for more information on
how Heartland tailors its services to the individual needs of
its clients.
From time to time, Heartland provides discretionary
investment advisory services to nancial institutions, such as
investment advisers, banks, broker-dealers or other nancial
intermediaries (“Intermediaries”). In addition, Heartland may
provide investment management services through programs
sponsored by unaf liated broker-dealers or other nancial
intermediaries that typically offer a combination
of brokerage,
custody and investment advisory services (“wrap programs”)
to various clients for a single fee. Heartland also offers
model portfolio services to uni ed managed account (“UMA”)
programs by providing a model portfolio that is based on an
investment strategy offered by Heartland and periodically
communicating portfolio changes to the program sponsors.
The Intermediaries and sponsors of UMA and wrap programs
are referred to as “Program Sponsors”. In these programs,
the client enters into an investment advisory agreement with
the Program Sponsor and in turn the Program Sponsor
generally enters into a sub-advisory agreement or other
arrangement with Heartland. Heartland typically is paid a
portion of the program fee by the Program Sponsor.
The Program Sponsors generally determine suitability for
program clients, particularly for UMAs where Heartland is not
responsible for trade execution, trade timing, broker
selection, recordkeeping or other client services. However, in
some cases, Heartland relies on the information regarding
each prospective client that is provided to Heartland by the
Program Sponsor in determining the suitability of Heartland’s
investment management style selected by a program client
to the individual needs and nancial situation of such client.
Heartland may also serve as an investment manager or
subadviser to clients of other Intermediaries on a
discretionary basis, either by contracting directly with the
Intermediary or through a contract with a managed account
program sponsor, in exchange for a fee based on the assets
managed by Heartland. The Intermediary is responsible for
determining the suitability of Heartland’s investment
management style for the client.
The fees paid to Heartland vary from the schedule of fees
stated in Item 5: Fees and Compensation and between
different wrap or model portfolio programs. In addition,
clients participating in a wrap or model portfolio program
typically are not subject to Heartland’s minimum account
size that otherwise applies to other separately managed
accounts.
As of December 31, 2022, Heartland managed
$1,691,149,105 in client assets on a discretionary basis
and $0 in client assets on a non-discretionary basis.