RED CRANE WEALTH MANAGEMENT, LLC

Item 1: Cover Page Part 2 of Form ADV: Wrap Fee Program Brochure February 2026 Red Crane Wrap Program 3000 El Camino Real, Building 4, Suite 200 Palo Alto, CA 94306 www.RedCraneWealth.com Firm Contact: Brent Woolsey Chief Compliance Officer the contents of firm is also available on This brochure provides information about the qualifications and business practices of Red Crane Wealth Management, LLC dba Red Crane Wealth Management (the “firm” or “Red Crane”) with respect to its Wrap Comprehensive Portfolio Management program. If clients have any questions about this brochure, please contact us by at (415) 316-0982 or brent@redcranewealth.com. The information in this brochure has not been approved or verified by the United States Securities and Exchange Commission or by any State Securities Authority. Additional the SEC’s website at information about our www.adviserinfo.sec.gov by searching CRD #284006. Please note that the use of the term “registered investment adviser” and description of our firm and/or our associates as “registered” does not imply a certain level of skill or training. Clients are encouraged to review this Brochure and Brochure Supplements for our firm’s associates who advise clients for more information on the qualifications of our firm and our employees.  Item 2: Material Changes Red Crane Wealth Management is required to make clients aware of information that has changed since the last annual update to the Wrap Brochure (“Wrap Brochure”) and that may be important to them. Clients can then determine whether to review the brochure in its entirety or to contact us with questions about the changes. Since the last annual amendment filed on 02/07/2025, our firm has no material changes to disclose. ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 2 Red Crane Wealth Management  Item 3: Table of Contents Item 1: Cover Page .................................................................................................................................................................. 1 Item 2: Material Changes ...................................................................................................................................................... 2 Item 3: Table of Contents ..................................................................................................................................................... 3 Item 4: Services, Fees & Compensation .......................................................................................................................... 4 Item 5: Account Requirements & Types of Clients .................................................................................................... 6 Item 6: Portfolio Manager Selection & Evaluation ..................................................................................................... 6 Item 7: Client Information Provided to Portfolio Manager(s) .............................................................................. 9 Item 8: Client Contact with Portfolio Manager(s) .................................................................................................... 10 Item 9: Additional Information ........................................................................................................................................ 10 ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 3 Red Crane Wealth Management  Item 4: Services, Fees & Compensation Our firm manages assets for a variety of clients to help meet their financial goals while remaining sensitive to risk tolerance and time horizons. As a fiduciary it is our duty to always act in the client’s best interest. This is accomplished in part by knowing the client. Our firm has established a service- oriented advisory practice with open lines of communication. Working with clients to understand their investment objectives while educating them about our process, facilitates the kind of working relationship we value. Our wrap fee program allows clients to pay a single fee for investment advisory services and associated custodial transaction costs. Because our firm absorbs client transaction fees, an incentive exists to limit trading activities in client accounts. Custodial transaction costs, however, are not included in the advisory fee charged by our firm for non-wrap services, and are to be paid by the client to their chosen custodian. Depending on the client’s account or portfolio trading activity, clients may pay more for using our wrap fee services than they would for using our non-wrap services. Our firm also provides investment advisory services to a private fund. Please see ADV Part 2A, Firm Brochure, for more information on our firm’s advisory services, which is available upon request. Our recommended custodian, Charles Schwab & Co., Inc. (“Schwab”), does not charge transaction fees for U.S. listed equities and exchange traded funds. Since we pay the transaction fees charged by the custodian to clients participating in our wrap fee program, this presents a conflict of interest because we are incentivized to recommend equities and exchange traded funds over other types of securities in order to reduce our costs. Our Wrap Advisory Services Wrap Comprehensive Portfolio Management: As part of our Wrap Comprehensive Portfolio Management (“Wrap Fee Program”) clients (“Wrap Account”) will be provided asset management and financial planning or consulting services. This service is designed to assist clients in meeting their financial goals through the use of a financial plan or consultation. Our firm conducts client meetings to understand their current financial situation, existing resources, financial goals, and tolerance for risk. Based on what is learned, an investment approach is presented to the client, consisting of individual stocks, bonds, ETFs, options, mutual funds and other public and private securities or investments. Once the appropriate portfolio has been determined, portfolios are continuously and regularly monitored, and if necessary, rebalanced based upon the client’s individual needs, stated goals and objectives. Upon client request, our firm provides a summary of observations and recommendations for the planning or consulting aspects of this service. Our firm utilizes the sub-advisory services of a third party investment advisory firm or individual advisor to aid in the implementation of an investment portfolio designed by our firm. Before selecting a firm or individual, our firm will ensure that the chosen party is properly licensed or registered. Our firm will not offer advice on any specific securities or other investments in connection with this service. We will provide initial due diligence on third party money managers and ongoing reviews of their management of client accounts. In order to assist in the selection of a third party money ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 4 Red Crane Wealth Management  manager, our firm will gather client information pertaining to financial situation, investment objectives, and reasonable restrictions to be imposed upon the management of the account. Our firm will periodically review third party money manager reports provided to the client at least annually. Our firm will contact clients from time to time in order to review their financial situation and objectives; communicate information to third party money managers as warranted; and, assist the client in understanding and evaluating the services provided by the third party money manager. Clients will be expected to notify our firm of any changes in their financial situation, investment objectives, or account restrictions that could affect their financial standing. Tiered Fee Schedule (Assets Billed at Tiered Rate) The Tiered Fee Schedule is applied by corresponding asset tier with each successive level achieved receiving the lower fee stated on the Fee Schedule below. Assets Under Management Annual Percentage of Assets Charge Up to $500,000 $500,001 to $1,000,000 $1,000,001 to $2,000,000 $2,000,001 to $5,000,000 $5,000,001 to $10,000,000 Over $10,000,001 1.25% 1.00% 0.85% 0.75% 0.65% 0.50% Fees to be assessed will be outlined in the advisory agreement to be signed by the client. Annualized fees are billed on a pro-rata basis monthly in arrears based on the value of the account(s) on the time- weighted daily average of the month. Fees are generally negotiable and will be deducted from client account(s). Our firm does not offer direct invoicing. Unless otherwise noted in writing, our firm bills on cash. As part of this process, clients understand the following: a) b) c) The client’s independent custodian sends statements at least quarterly showing the market values for each security included in the Assets and all account disbursements, including the amount of the advisory fees paid to our firm; Clients will provide authorization permitting our firm to be directly paid by these terms. Our firm will send an invoice directly to the custodian; and If our firm sends a copy of our invoice to the client, a legend urging the comparison of information provided in our statement with those from the qualified custodian will be included. The maximum annual fee charged to clients utilizing Third Party Managers will not exceed the maximum fee published above for this service. Our firm will debit fees for this service as disclosed in the executed advisory agreement between the client and our firm. This fee shall be in addition to any fees assessed by the chosen third party money manager. The third -party money managers we recommend will not directly charge you a higher fee than they would have charged without us introducing you to them. Third party money managers establish and maintain their own separate billing processes over which we have no control. They will directly bill you and describe how this works in their separate written disclosure documents. Other Types of Fees & Expenses: ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 5 Red Crane Wealth Management  The fees not included in the advisory fee for our wrap services are charges imposed directly by a mutual fund, index fund, or exchange traded fund which shall be disclosed in the fund’s prospectus (i.e., fund management fees and other fund expenses), mark-ups and mark-downs, spreads paid to market makers, wire transfer fees, custodial fees, non-standard asset fees and other fees and taxes on brokerage accounts and securities transactions. Termination and Refunds: Either party may terminate the advisory agreement signed with our firm for Wrap Comprehensive Portfolio Management services in writing at any time. Upon notice of termination pro-rata advisory fees for services rendered to the point of termination will be charged. If advisory fees cannot be deducted, our firm will send an invoice for due advisory fees to the client. Wrap Fee Program Recommendations Our firm does not recommend or offer the wrap program services of other providers. Item 5: Account Requirements & Types of Clients • Our requirements for opening and maintaining accounts or otherwise engaging us: Our firm requires a minimum account balance of $500,000 for our Wrap Comprehensive Portfolio Management service. This minimum account balance requirement is negotiable. Our firm has the following types of clients: • • Individuals and High Net Worth Individuals; and Trusts, Estates or Charitable Organizations. Item 6: Portfolio Manager Selection & Evaluation Selection of Portfolio Managers Our firm’s investment adviser representatives (“IAR”s) act as portfolio manager(s) for this Wrap Fee Program. A conflict arises in that other investment advisory firms may charge the same or lower fees than our firm for similar services. Our IARs are subject to individual licensing requirements as imposed by state securities boards. Our firm is required to confirm or update each IAR’s Form U4 on an annual basis. IAR supervision is conducted by our Chief Compliance Officer or management personnel. Advisory Business: Information about our wrap fee services can be found in Item 4 of this brochure. Our firm offers individualized investment advice to our Wrap Account clients. Each Wrap Account client has the opportunity to place reasonable restrictions on the types of investments to be held in the portfolio. Restrictions on investments in certain securities or types of securities may not be possible due to the level of difficulty this would entail in managing the account. ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 6 Red Crane Wealth Management  Participation in Wrap Fee Programs: Wrap Account clients that participate in our Wrap Comprehensive Portfolio Management services are managed on an individualized basis according to the client’s investment objectives, financial goals, risk tolerance, etc. Performance-Based Fees & Side-By-Side Management: With respect to Wrap Account clients, our firm does not charge performance-based fees. Methods of Analysis, Investment Strategies & Risk of Loss: The following methods of analysis are utilized by our firm when formulating investment advice and/or managing client assets: Fundamental analysis considers the economic, financial, and other qualitative/quantitative factors that may impact the price of a security. Fundamental analysis attempts to measure its intrinsic value as compared to its current price. Risks may include using incorrect assumptions, financial misreporting and/or failure by management to disclose key, material events, and unforeseen micro/macroeconomic factors that may cause the price of a security to diverge from its intrinsic value. Cyclical Analysis: statistical analysis of specific events occurring at a sufficient number of regular intervals that they can be forecasted into the future. Charting: In this type of technical analysis, we review charts of market and security activity in an attempt to identify when the market is moving up or down and to predict when how long the trend Technical analysis may last and when that trend might reverse. attempts to predict future price movements of a security based on historical data, such as price and volume. Technical analysis may involve using charts to identify recurring patterns and trends, but there is no guarantee that those patterns and trends will reoccur. Quantitative analysis uses statistical models to estimate the impact of user-defined “factors” on a security’s price movement, and attempts to extrapolate future movements based on that analysis. Models are an imperfect representation of reality, and therefore, there is no guarantee they will lead to accurate results. Qualitative Analysis: We use qualitative analysis to evaluate individual securities, focusing on nonquantifiable factors such as quality of management and others not readily subject to measurement, and incorporate that analysis into our security selection process. A risk in using qualitative analysis is that our subjective judgment may prove incorrect. Duration Constraints: We adhere to a discipline of generally maintaining duration within a narrow band around benchmark duration in order to limit exposure to market risk. Our portfolio management team rebalances client portfolios to their current duration targets on a periodic basis. The risk of constraining duration is that the client may not participate fully in a large rally in bond prices. ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 7 Red Crane Wealth Management  Sector Allocation: We allocate client assets to various sectors of the fixed income market, including US Treasury obligations, federal agency securities, corporate notes, mortgage-backed securities and others, based on our quantitative and qualitative analysis in order to manage client exposure to a given sector and to provide exposure to sectors we believe have good value. The risk of sector allocation is that clients may not participate fully in an increase in value in any specific sector. The following investment strategies are used managing client accounts, provided that such strategies are appropriate to the needs of the client and consistent with the client's investment objectives, risk tolerance, and time horizons, among other considerations: Asset Allocation: We generally focus on identifying an appropriate allocation of securities, maturities, market sectors and yield curve positioning suitable for the client’s investment goals and risk tolerance. While asset allocation is recognized by professional investment advisers as a prudent approach, a risk of asset allocation is that the client may not participate in sharp increases in a particular security, industry or market sector. Another risk is that the allocation will change over time due to market movements in the various sectors, which, if not corrected, may no longer be appropriate for the client’s goals. Long-Term Purchases: We may buy securities for your account and hold them for a relatively long time (more than a year) in anticipation that the security’s value will appreciate over a long horizon. The risk of this strategy is that we could miss out on potential short-term gains that could have been profitable to your account. Moreover, if our predictions are incorrect, it’s possible that the security’s value may decline sharply before we make a decision to sell. Short-Term Purchases: We may buy securities for your account and decide to sell them within a relatively short time horizon (less than a year) in order to capitalize on short-term price fluctuations. There’s no guarantee, however, that this strategy will be able to produce gains. Trading: We may buy securities for your account and sell them quickly (typically within 30 days) in order to take advantage of short-term price volatility. As with short-term purchases, there is no guarantee that this strategy will be able to produce gains. Margin Transactions: If your account is set up for margin transactions, we may buy on margin for your account. Buying on margin is essentially borrowing money from a broker/custodian to purchase the security. Because using borrowed money amplifies gains and losses, buying on margin can substantially increase the risk of your portfolio. Option writing: If your account is set up and approved for options capabilities, we may employ options strategies to enhance your portfolio returns and/or hedge risk. An option is a contract that gives the buyer the right, but not the obligation to buy or sell a security at a specific price on or before a certain date. We may use “covered call” writing strategies to generate income from selling an option against a security you own. We may also use call or put options to speculate on price movements on the underlying security. So called “naked calls or puts” may substantially increase the risk in your portfolio. Fixed Income Portfolio Management Investment Strategies: We believe that a conservative, risk-averse approach to fixed income management will provide both steady incremental outperformance, and low relative volatility. The disciplined process we employ in an effort to realize this philosophy is generally grounded in four key decisions: ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 8 Red Crane Wealth Management  1. 2. 3. 4. Constraint of portfolio duration within a narrow range relative to the benchmark in order to limit exposure to market and interest rate risk. Strategic allocations to key sectors to add value relative to the benchmark. Proactive management of term structure to add value in different yield curve environments. Security selection based on rigorous credit and relative value analysis and broad diversification of nongovernment issuers. Within our Fixed Income strategy, we use the following sub-strategies in managing client accounts, provided that such sub-strategies are appropriate to the needs of the client and consistent with the client's investment objectives, risk tolerance, and time horizons, among other considerations. Alternative Investments: Hedge funds, commodity pools, Real Estate Investment Trusts (“REITs”), Business Development Companies (“BDCs”), and other alternative investments involve a high degree of risk and can be illiquid due to restrictions on transfer and lack of a secondary trading market. They can be highly leveraged, speculative and volatile, and an investor could lose all or a substantial amount of an investment. Alternative investments may lack transparency as to share price, valuation and portfolio holdings. Complex tax structures often result in delayed tax reporting. Compared to mutual funds, hedge funds and commodity pools are subject to less regulation and often charge higher fees and may require “capital calls” which would require additional investment. Alternative investment managers typically exercise broad investment discretion and may apply similar strategies across multiple investment vehicles, resulting in less diversification. Risk of Loss: Investing in securities involves risk of loss that clients should be prepared to bear. While the stock market may increase and your account(s) could enjoy a gain, it is also possible that the stock market may decrease and your account(s) could suffer a loss. It is important that you understand the risks associated with investing in the stock market, are appropriately diversified in your investments, and ask any questions you may have. Voting Client Securities: With respect to our Wrap Account clients, our firm does not accept the proxy authority to vote client securities. Clients will receive proxies or other solicitations directly from their custodian or a transfer agent. In the event that proxies are sent to our firm, our firm will forward them to the appropriate client and ask the party who sent them to mail them directly to the client in the future. Clients may call, write or email us to discuss questions they may have about particular proxy votes or other solicitations. Item 7: Client Information Provided to Portfolio Manager(s) All Wrap Account clients are managed by our in-house IARs. The IAR selected to manage the client’s account(s) or portfolio(s) will be privy to the client’s investment goals and objectives, risk tolerance, restrictions placed on the management of the account(s) or portfolio(s) and relevant client notes taken by our firm. Please see our firm’s Privacy Policy for more information on how our firm utilizes client information. ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 9 Red Crane Wealth Management  Item 8: Client Contact with Portfolio Manager(s) Clients are always free to directly contact their portfolio manager(s) with any questions or concerns about their portfolios or other matters. Item 9: Additional Information Disciplinary Information There are no legal or disciplinary events that are material to the evaluation of our advisory business or the integrity of our management. Financial Industry Activities & Affiliations Our firm has no other financial industry activities and affiliations to disclose. Our firm is not registered, nor does it have an application pending to register, as a broker-dealer, registered representative of a broker dealer, futures commission merchant, commodity pool operator, commodity trading advisor, or an associated person of the foregoing entities. Our firm does not recommend or select other investment advisers for our clients. Code of Ethics, Participation or Interest in Client Transactions & Personal Trading As a fiduciary, it is an investment adviser’s responsibility to provide fair and full disclosure of all material facts and to act solely in the best interest of each of our clients at all times. Our fiduciary duty is the underlying principle for our firm’s Code of Ethics, which includes procedures for personal securities transaction and insider trading. Our firm requires all representatives to conduct business with the highest level of ethical standards and to comply with all federal and state securities laws at all times. Upon employment with our firm, and at least annually thereafter, all representatives of our firm will acknowledge receipt, understanding and compliance with our firm’s Code of Ethics. Our firm and representatives must conduct business in an honest, ethical, and fair manner and avoid all circumstances that might negatively affect or appear to affect our duty of complete loyalty to all clients. This disclosure is provided to give all clients a summary of our Code of Ethics. If a client or a potential client wishes to review our Code of Ethics in its entirety, a copy will be provided promptly upon request. Our firm recognizes that the personal investment transactions of our representatives demands the application of a Code of Ethics with high standards and requires that all such transactions be carried out in a way that does not endanger the interest of any client. At the same time, our firm also believes that if investment goals are similar for clients and for our representatives, it is logical, and even desirable, that there be common ownership of some securities. 1 In order to prevent conflicts of interest, our firm has established procedures for transactions effected by . In order to monitor compliance with our personal our representatives for their personal accounts 1 For purposes of the policy, our associate’s personal account generally includes any account (a) in the name of our associate, his/her spouse, his/her minor children or other dependents residing in the same household, (b) for which our associate is a trustee or executor, or (c) which our ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 10 Red Crane Wealth Management  trading policy, our firm has pre-clearance requirements and a quarterly securities transaction reporting system for all of our representatives. Neither our firm nor a related person recommends, buys or sells for client accounts, securities in which our firm or a related person has a material financial interest without prior disclosure to the client. Related persons of our firm may buy or sell securities and other investments that are also recommended to clients. In order to minimize this conflict of interest, our related persons will place client interests ahead of their own interests and adhere to our firm’s Code of Ethics, a copy of which is available upon request. Likewise, related persons of our firm buy or sell securities for themselves at or about the same time they buy or sell the same securities for client accounts. In order to minimize this conflict of interest, our related persons will place client interests ahead of their own interests and adhere to our firm’s Code of Ethics, a copy of which is available upon request. Further, our related persons will refrain from buying or selling the same securities prior to buying or selling for our clients in the same day. Related persons’ accounts may be included in a block trade. Review of Accounts Our Chief Compliance Officer, Brent Woolsey, reviews accounts on at least a quarterly basis for our Wrap Account clients. The nature of these reviews is to learn whether clients’ accounts are in line with their investment objectives, appropriately positioned based on market conditions, and investment policies, if applicable. Our firm may review client accounts more frequently than described above. Among the factors which may trigger an off-cycle review are major market or economic events, the client’s life events, requests by the client, etc. Our firm does not provide written reports to clients, unless asked to do so. Verbal reports to clients take place on at least an annual basis when our Wrap Comprehensive Portfolio Management clients are contacted. Custodian & Brokers Used Item 15 Our firm does not maintain custody of client assets (although our firm may be deemed to have Custody custody of client assets if give the authority to withdraw assets from client accounts. See , below). Client assets must be maintained in an account at a “qualified custodian,” generally a broker-dealer or bank. Our firm recommends that clients use the Schwab Advisor Services division of Charles Schwab & Co. Inc. (“Schwab”), a FINRA-registered broker-dealer, member SIPC, as the qualified custodian. Our firm is independently owned and operated, and not affiliated with Schwab. Schwab will hold client assets in a brokerage account and buy and sell securities when instructed. While our firm recommends that clients use Schwab as custodian/broker, clients will decide whether to do so and open an account with Schwab by entering into an account agreement directly with them. Our firm does not open the account. Even though the account is maintained at Schwab, our firm can still use other brokers to execute trades, as described in the next paragraph. associate controls, including our client accounts which our associate controls and/or a member of his/her household has a direct or indirect beneficial interest in. ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 11 Red Crane Wealth Management  How Brokers/Custodians Are Selected • Our firm seeks to recommend a custodian/broker who will hold client assets and execute transactions on terms that are overall most advantageous when compared to other available providers and their services. A wide range of factors are considered, including, but not limited to: • • • • • • • • combination of transaction execution services along with asset custody services (generally without a separate fee for custody) capability to execute, clear and settle trades (buy and sell securities for client accounts) capabilities to facilitate transfers and payments to and from accounts (wire transfers, check requests, bill payment, etc.) breadth of investment products made available (stocks, bonds, mutual funds, exchange traded funds (ETFs), etc.) availability of investment research and tools that assist in making investment decisions quality of services competitiveness of the price of those services (commission rates, margin interest rates, other fees, etc.) and willingness to negotiate them reputation, financial strength and stability of the provider prior service to our firm and our other clients Products & Services Available from Schwab availability of other products and services that benefit our firm, as discussed below (see “ ”) Custody & Brokerage Costs Schwab generally does not charge a separate for custody services, but is compensated by charging commissions or other fees to clients on trades that are executed or that settle into the Schwab account. In addition to commissions, Schwab charges a flat dollar amount as a “prime broker” or “trade away” fee for each trade that our firm has executed by a different broker-dealer but where the securities bought or the funds from the securities sold are deposited (settled) into a Schwab account. These fees are in addition to the commissions or other compensation paid to the executing broker- dealer. Because of this, in order to minimize client trading costs, our firm has Schwab execute most trades for the accounts. Products & Services Available from Schwab Schwab Advisor Services is Schwab’s business serving independent investment advisory firms like our firm. They provide our firm and clients with access to its institutional brokerage – trading, custody, reporting and related services – many of which are not typically available to Schwab retail customers. Schwab also makes available various support services. Some of those services help manage or administer our client accounts while others help manage and grow our business. Schwab’s support services are generally available on an unsolicited basis (our firm does not have to request them) and at no charge to our firm. The availability of Schwab’s products and services is not based on the provision of particular investment advice, such as purchasing particular securities for clients. Here is a more detailed description of Schwab’s support services: Services that Benefit Clients Schwab’s institutional brokerage services include access to a broad range of investment products, execution of securities transactions, and custody of client assets. The investment products available ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 12 Red Crane Wealth Management  through Schwab include some to which our firm might not otherwise have access or that would require a significantly higher minimum initial investment by firm clients. Schwab’s services described in this paragraph generally benefit clients and their accounts. Services that May Not Directly Benefit Clients • Schwab also makes available other products and services that benefit our firm but may not directly benefit clients or their accounts. These products and services assist in managing and administering our client accounts. They include investment research, both Schwab’s and that of third parties. This research may be used to service all or some substantial number of client accounts, including accounts not maintained at Schwab. In addition to investment research, Schwab also makes available software and other technology that: • • • • provides access to client account data (such as duplicate trade confirmations and account statements); facilitates trade execution and allocate aggregated trade orders for multiple client accounts; provides pricing and other market data; facilitates payment of our fees from our clients’ accounts; and assists with back-office functions, recordkeeping and client reporting. Services that Generally Benefit Only Our Firm Schwab also offers other services intended to help manage and further develop our business enterprise. These services include: • • • • educational conferences and events technology, compliance, legal, and business consulting; publications and conferences on practice management and business succession; and access to employee benefits providers, human capital consultants and insurance providers. Schwab may provide some of these services itself. In other cases, Schwab will arrange for third-party vendors to provide the services to our firm. Schwab may also discount or waive fees for some of these services or pay all or a part of a third party’s fees. Schwab may also provide our firm with other benefits, such as occasional business entertainment for our personnel. Irrespective of direct or indirect benefits to our client through Schwab, our firm strives to enhance the client experience, help clients reach their goals and put client interests before that of our firm or associated persons. Our Interest in Schwab’s Services. The availability of these services from Schwab benefits our firm because our firm does not have to produce or purchase them. Our firm does not have to pay for these services, and they are not contingent upon committing any specific amount of business to Schwab in trading commissions or assets in custody. In light of our arrangements with Schwab, a conflict of interest exists as our firm may have incentive to require that clients maintain their accounts with Schwab based on our interest in receiving Schwab’s services that benefit our firm rather than based on client interest in receiving the best value in custody services and the most favorable execution of transactions. As part of our fiduciary duty to our clients, our firm will endeavor at all times to put the interests of our clients first. Clients should ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 13 Red Crane Wealth Management  be aware, however, that the receipt of economic benefits by our firm or our related persons creates a potential conflict of interest and may indirectly influence our firm’s choice of Schwab as a custodial recommendation. Our firm examined this potential conflict of interest when our firm chose to recommend Schwab and have determined that the recommendation is in the best interest of our firm’s clients and satisfies our fiduciary obligations, including our duty to seek best execution. In seeking best execution, the determinative factor is not the lowest possible cost, but whether the transaction represents the best qualitative execution, taking into consideration the full range of a broker-dealer’s services, including the value of research provided, execution capability, commission rates, and responsiveness. Although our firm will seek competitive rates, to the benefit of all clients, our firm may not necessarily obtain the lowest possible commission rates for specific client account transactions. Our firm believes that the selection of Schwab as a custodian and broker is the best interest of our clients. It is primarily supported by the scope, quality and price of Schwab’s services, and not Schwab’s services that only benefit our firm. Other Compensation Form ADV Part 2A, Item 12 – Brokerage Practices Our firm receives economic benefit from Schwab in the form of the support products and services made available to our firm and other independent investment advisors that have their clients maintain accounts at Schwab. These products and services, how they benefit our firm, and the related conflicts of interest are described in . The availability of Schwab’s products and services is not based on our firm giving particular investment advice, such as buying particular securities for our clients. Client Referrals In accordance with Rule 206 (4)-1 of the Investment Advisers Act of 1940, our firm does not provide cash or non-cash compensation directly or indirectly to unaffiliated persons for testimonials or endorsements (which include client referrals). Financial Information • Our firm is not required to provide financial information in this Brochure because: • • • Our firm does not require the prepayment of more than $1,200 in fees and six or more months in advance. Our firm does not take custody of client funds or securities. Our firm does not have a financial condition or commitment that impairs our ability to meet contractual and fiduciary obligations to clients. Our firm has never been the subject of a bankruptcy proceeding. ADV Part 2A, Appendix 1 – Wrap Fee Brochure Page 14 Red Crane Wealth Management 

Item 1: Cover Page Part 2A of Form ADV: Firm Brochure February 2026 3000 El Camino Real, Building 4, Suite 200 Palo Alto, CA 94306 www.RedCraneWealth.com Firm Contact: Brent Woolsey Chief Compliance Officer firm is also available on This brochure provides information about the qualifications and business practices of Red Crane Wealth Management, LLC dba Red Crane Wealth Management (“firm” or “Red Crane”). If clients have any questions about the contents of this brochure, please contact us at (415) 316-0982 or brent@redcranewealth.com. The information in this brochure has not been approved or verified by the United States Securities and Exchange Commission or by any State Securities Authority. Additional the SEC’s website at information about our www.adviserinfo.sec.gov by searching CRD #284006. Please note that the use of the term “registered investment adviser” and description of our firm and/or our associates as “registered” does not imply a certain level of skill or training. Clients are encouraged to review this Brochure and Brochure Supplements for our firm’s associates who advise clients for more information on the qualifications of our firm and our employees.  Item 2: Material Changes Red Crane Wealth Management is required to make clients aware of information that has changed since the last annual update to the Firm Brochure (“Brochure”) and that may be important to them. Clients can then determine whether to review the brochure in its entirety or to contact us with questions about the changes. Since the last annual amendment filed on 02/07/2025, our firm has no material changes to disclose. ADV Part 2A – Firm Brochure Page 2 Red Crane Wealth Management  Item 3: Table of Contents ....................................................................................................................................... 1 ............................................................................................................................ 2 ............................................................................................................................ 3 .......................................................................................................................... 4 ..................................................................................................................... 6 .............................................................. 8 ................................................................................... 8 ........................................................ 9 .............................................................................................................. 14 .................................................................... 14 .............................................................................. 15 .................................................................................................. 15 ................................................................................................................... 16 ..................................................................................... 18 ................................................................................... 19 ....................................................................................................................................... 19 ............................................................................................................... 20 .............................................................................................................. 21 ................................................................................................................ 21 Item 1: Cover Page Item 2: Material Changes Item 3: Table of Contents Item 4: Advisory Business Item 5: Fees & Compensation Item 6: Performance-Based Fees & Side-By-Side Management Item 7: Types of Clients & Account Requirements Item 8: Methods of Analysis, Investment Strategies & Risk of Loss Item 9: Disciplinary Information Item 10: Other Financial Industry Activities & Affiliations Item 11: Code of Ethics, Participation or Interest in Client Transactions & Personal Trading Item 12: Brokerage Practices Item 13: Review of Accounts or Financial Plans Item 14: Client Referrals & Other Compensation Item 15: Custody Item 16: Investment Discretion Item 17: Voting Client Securities Item 18: Financial Information ADV Part 2A – Firm Brochure Page 3 Red Crane Wealth Management  Item 4: Advisory Business Our firm is dedicated to providing individuals and other types of clients with a wide array of investment advisory services. Our firm is a limited liability company formed under the laws of the State of California in 2016 and has been in business as an investment adviser since that time. Our firm is owned by Brent Woolsey & Jeffrey Wu. Our firm provides asset management and investment consulting services to a variety of clients. As a fiduciary, it is our duty to always act in the client’s best interest. This is accomplished in part by knowing the client. Our firm has established a service-oriented advisory practice with open lines of communication. Working with clients to understand their investment objectives while educating them about our process, facilitates the kind of working relationship we value. Types of Advisory Services Offered 1. Wrap Comprehensive Portfolio Management: We offer Wrap Comprehensive Portfolio Management (“Wrap Fee Program”) services through wrapped accounts only (the “Wrap Account”). We manage accounts on an individualized basis and strive to help meet our clients’ financial goals while remaining sensitive to risk tolerance and time horizons. Wrap Account arrangements are governed by a written advisory agreement (the “Agreement”) executed by both Red Crane and the Wrap Account client. Please see Part 2A, Appendix 1 (the “Wrap Fee Program Brochure for complete information regarding this advisory service. We allow Wrap Account clients subscribing to our Wrap Fee Program to place reasonable restrictions on types of investments to be held in the portfolio. Restrictions on investments in certain securities or types of securities may not be possible due to the level of difficulty this would entail in managing the account. We do not manage assets through our other services. Our firm utilizes the sub-advisory services of a third party investment advisory firm or individual advisor to aid in the implementation of an investment portfolio designed by our firm. Before selecting a firm or individual, our firm will ensure that the chosen party is properly licensed or registered. Our firm will not offer advice on any specific securities or other investments in connection with this service. We will provide initial due diligence on third party money managers and ongoing reviews of their management of client accounts. In order to assist in the selection of a third party money manager, our firm will gather client information pertaining to financial situation, investment objectives, and reasonable restrictions to be imposed upon the management of the account. Our firm will periodically review third party money manager reports provided to the client at least annually. Our firm will contact clients from time to time in order to review their financial situation and objectives; communicate information to third party money managers as warranted; and, assist the client in understanding and evaluating the services provided by the third party money manager. Clients will be expected to notify our firm of any changes in their financial situation, investment objectives, or account restrictions that could affect their financial standing. 2. Private Fund: ADV Part 2A – Firm Brochure Page 4 Red Crane Wealth Management  Red Crane also serves as a general partner and investment adviser to a private investment fund (the “Fund”). We may decide in the future to sponsor or manage additional private investment funds (collectively with the Wrap Account clients, the “Clients”). The Fund is offering limited partnership interests (“Interests”) to certain qualified investors as described in response to Item 7, below (such investors are referred to herein as “Investors”). Pursuant to each Fund’s offering memorandum, limited partnership agreement, and subscription documents (“Offering Documents”) (together with the Agreements, “Constituent Documents”). 3. Financial Planning & Consulting: Our firm provides a variety of standalone financial planning and consulting services to clients for the management of financial resources based upon an analysis of current situation, goals, and objectives. Financial planning services will typically involve preparing a financial plan or rendering a financial consultation for clients based on the client’s financial goals and objectives. This planning or consulting may encompass Investment Planning, Retirement Planning, Estate Planning, Charitable Planning, Education Planning, Corporate and Personal Tax Planning, Cost Segregation Study, Corporate Structure, Real Estate Analysis, Mortgage/Debt Analysis, Insurance Analysis, Lines of Credit Evaluation, or Business and Personal Financial Planning. Written financial plans or financial consultations rendered to clients usually include general recommendations for a course of activity or specific actions to be taken by the clients. Implementation of the recommendations will be at the discretion of the client. Our firm provides clients with a summary of their financial situation, and observations for financial planning engagements. Financial consultations are not typically accompanied by a written summary of observations and recommendations, as the process is less formal than the planning service. Assuming that all the information and documents requested from the client are provided promptly, plans or consultations are typically completed within 6 months of the client signing a contract with our firm. Tailoring of Advisory Services Our firm offers individualized investment advice to our Wrap Comprehensive Portfolio Management clients. General investment advice will be offered to our Financial Planning & Consulting and Referrals to Third Party Money Management clients. Each Wrap Account client has the opportunity to place reasonable restrictions on the types of investments to be held in the portfolio. Restrictions on investments in certain securities or types of securities may not be possible due to the level of difficulty this would entail in managing the account. Participation in Wrap Fee Programs Our firm offers and sponsors a wrap fee program. Comprehensive Portfolio Management services are only offered through wrapped accounts, which are managed on an individualized basis according to the client’s investment objectives, financial goals, risk tolerance, etc. Please see our Part 2A, Appendix 1 (the “Wrap Fee Program Brochure”) for more information. Regulatory Assets Under Management As of December 31, 2025, the firm has approximately $151,574,482 of assets under management on a discretionary basis. ADV Part 2A – Firm Brochure Page 5 Red Crane Wealth Management  Item 5: Fees & Compensation The fees and compensation payable to Red Crane are negotiable and vary among the Clients. However, the range of compensation is generally as follows: 1. Management Fee Wrap Comprehensive Portfolio Management: Please see our Wrap Fee Program Brochure for Wrap Account fees. Private Fund: With respect to the Fund, Red Crane typically receives a quarterly management fee, calculated at an annual rate of 2.0%. 2. Performance-based Fee Wrap Comprehensive Portfolio Management: With respect to the Wrap Accounts, Red Crane does not charge or receive performance-based fees. Private Fund: With respect to the Fund, Red Crane generally receives an incentive allocation equal to a percentage of the net income allocated to each Investor for the year, but only to the extent net income allocated to that Investor exceeds any cumulative losses that were allocated to that Investor for earlier periods and that have not been recovered (a “high water mark”). This incentive allocation is generally 20% and is typically made at the end of each calendar year. 3. Financial Planning & Consulting: Our firm charges on an hourly or flat fee basis for financial planning and consulting services. The total estimated fee, as well as the ultimate fee charged, is based on the scope and complexity of our engagement with the client. The maximum hourly fee to be charged will not exceed $400. Flat fees range from $3,000 to $10,000. The fee-paying arrangements will be determined on a case-by-case basis and will be detailed in the signed consulting agreement. Our firm will not require a retainer exceeding $1,200 when services cannot be rendered within 6 months. Other Types of Fees & Expenses Clients will incur transaction fees for trades executed by their chosen custodian, via individual transaction charges. These transaction fees are separate from our firm’s advisory fees and will be disclosed by the chosen custodian. Charles Schwab & Co., Inc. (“Schwab”) does not charge transaction fees for U.S. listed equities and exchange traded funds. ADV Part 2A – Firm Brochure Page 6 Red Crane Wealth Management  Clients may also pay holdings charges imposed by the chosen custodian for certain investments, charges imposed directly by a mutual fund, index fund, or exchange traded fund, which shall be disclosed in the fund’s prospectus (e.g., fund management fees, distribution fees, surrender charges, variable annuity fees, IRA and qualified retirement plan fees, mark-ups and mark-downs, spreads paid to market makers, fees for trades executed away from custodian, wire transfer fees and other fees and taxes on brokerage accounts and securities transactions). Our firm does not receive a portion of these fees. Wrap Comprehensive Portfolio Management: Wrap Account clients will not incur transaction costs for trades. More information about this can be found in our separate Wrap Fee Program Brochure. Private Fund: The Fund pays such costs and expenses as Red Crane shall reasonably determine to be necessary, appropriate, advisable or convenient to carry on its business and realize its objective, including but not limited to: (i) all general investment expenses (i.e., expenses which Red Crane reasonably determines to be directly related to the investment of the Fund’s assets); (ii) all administrative, legal, accounting, auditing, record-keeping, tax form preparation, compliance and consulting costs and expenses; (iii) fees, costs and expenses of third-party service providers that provide such services; and, (iv) any extraordinary expenses, among other expenses. The Fund’s fees are exclusive of brokerage commissions, transaction fees, and other related costs and expenses which shall be incurred by the Fund. Such charges, fees and commissions are exclusive of and in addition to the management fee, and Red Crane shall not receive any portion of these commissions, fees, and costs. Please see Item 12 of this Brochure regarding brokerage. Termination & Refunds Wrap Comprehensive Portfolio Management: Either party may terminate the Agreement signed with our firm for our Wrap Fee Program in writing at any time. Upon notice of termination pro-rata advisory fees for services rendered to the point of termination will be charged. If advisory fees cannot be deducted, our firm will send an invoice for due advisory fees to the client. Private Fund: Capital Accounts of Limited Partners may be withdrawn as of the end of the calendar quarter that ends on or after the one-year anniversary of the initial Capital Contribution (the “Lock-Up Period”). After satisfying the Lock-Up Period, Capital Accounts may be withdrawn by a Limited Partner on the last day of each calendar quarter. All withdrawals will require 90 days’ prior written notice. Please refer to Red Crane Capital Fund, LP Private Placement Memorandum (PPM) & Limited Partnership Agreement (LPA) for details. Financial Planning & Consulting: ADV Part 2A – Firm Brochure Page 7 Red Crane Wealth Management  Financial Planning & Consulting clients may terminate their agreement at any time before the delivery of a financial plan by providing written notice. For purposes of calculating refunds, all work performed by us up to the point of termination shall be calculated at the hourly fee currently in effect. Clients will receive a pro-rata refund of unearned fees based on the time and effort expended by our firm. Commissionable Securities Sales Our firm and representatives do not sell securities for a commission in Client accounts. Item 6: Performance-Based Fees & Side-By-Side Management Wrap Comprehensive Portfolio Management: With respect to Wrap Accounts, our firm does not receive a performance-based fee. Private Fund : As discussed in Item 5, we generally receive an incentive allocation equal to a percentage of the net income allocated to each Investor for the year with respect to the Fund. Differences in Red Crane’s compensation arrangements with its Clients, particularly if the Fund pays a performance-based compensation, could create incentives for our firm to manage Client portfolios so as to favor those portfolios of clients paying performance-based compensation, as could our ownership interest (e.g., as the general partner) in some Client accounts. Notwithstanding these conflicts, Red Crane will allocate transactions and opportunities among the various Client accounts it manages in a manner it believes to be as equitable as possible, considering each account’s objectives, programs, limitations and capital available for investment, but even accounts with similar objectives will often have different investment portfolios. Performance-based compensation may provide a possible incentive for our firm to make riskier or more speculative investments on behalf of a Client than it might make otherwise. Notwithstanding this potential incentive, our firm will evaluate investments in a manner that it considers to be in the best interest of its Clients, given those Clients’ investment objectives, investment strategies, suitability of the investment, and risk profile. Red Crane may manage multiple portfolios for various Clients. When our firm manages more than one Client account, a potential a potential conflict exists for the portfolio manager to intentionally or unintentionally treat one account more favorably than another. This potential conflict can be most apparent when one portfolio has a higher fee or a different fee structure than another portfolio, including performance-based compensation. Red Crane has internal review policies and oversight to ensure that no one Client is intentionally or unintentionally favored at the expense of another. Item 7: Types of Clients & Account Requirements Wrap Comprehensive Portfolio Management: ADV Part 2A – Firm Brochure Page 8 Red Crane Wealth Management  • Our requirements for opening and maintaining accounts or otherwise engaging us: Our firm requires a minimum account balance of $500,000 for our Wrap Comprehensive Portfolio Management service. This minimum account balance requirement is negotiable. • • Our firm has the following types of Wrap Account clients: Individuals and High Net Worth Individuals; and Trusts, Estates or Charitable Organizations. Private Fund : Our firm also provides investment advice and management to the Fund. Red Crane may in the future provide the same or similar services to other privately placed investment funds. Red Crane intends to restrict the number of Investors in the Fund and will offer Interests only through non-public transactions in order to maintain their exclusion from “investment company” status under the Investment Company Act of 1940, as amended (the “Investment Company Act”). Prospective Investors in the Fund must meet eligibility criteria, and are subject to certain withdrawal requirements and limitations. Prospective Investors are encouraged to thoroughly review a Fund’s Constituent Documents, which set forth all of the terms in detail. Each Investor generally must be an “accredited investor” (as defined in Regulation D under the Securities Act of 1933), an Investor who is eligible to enter into a performance fee arrangement under state and/or federal law, as applicable, and must meet other criteria as specified in the Constituent Documents. The minimum initial investment is $200,000, and the minimum additional investment is $100,000, subject to waiver at the discretion of Red Crane. Item 8: Methods of Analysis, Investment Strategies & Risk of Loss Methods of Analysis We use the following methods of analysis in formulating our investment advice and/or managing Client assets: • • • • • • • • Charting; Cyclical; Fundamental; Technical; Qualitative; Quantitative; Duration Constraints; Sector Allocation. Investment Strategies We Use We generally use the following strategies in managing Client accounts, provided that such strategies are appropriate to the needs of the Client and consistent with the Client's investment objectives, risk tolerance, and time horizons, among other considerations: • Asset Allocation ADV Part 2A – Firm Brochure Page 9 Red Crane Wealth Management  • • • • • • Long Term Purchases (Securities Held At Least a Year); Short Term Purchases (Securities Sold Within a Year); Trading (Securities Sold Within 30 Days); Margin Transactions; Option Writing; Fixed Income. Please see the Wrap Fee Program Brochure for more information specific to the Wrap Fee Program. With respect to the Fund, it seeks long investments in global companies offering robust growth and strategic value with near term catalysts. Companies, sectors and indices exhibiting fundamental and technical dislocations will be selectively shorted. The Fund aims to generate attractive returns by participating in market upside and avoiding significant losses during market declines with this strategy. The portfolio manager pursues strategies that are flexible, unconstrained and incorporate downside-risk mitigation to navigate changing market conditions. Risk Factors Risk of Loss. Investing in securities involves risk of loss that clients should be prepared to bear. While the stock market may increase and the account(s) could enjoy a gain, it is also possible that the stock market may decrease, and the account(s) could suffer a loss. It is important that clients understand the risks associated with investing in the stock market, are appropriately diversified in investments, and ask any questions. General Investment and Trading Risks. Clients may invest in securities and other financial instruments using strategies and investment techniques with significant risk characteristics. The investment program utilizes such investment techniques as option transactions, margin transactions, short sales, forwards, leverage and derivatives trading, the use of which can, in certain circumstances, maximize the adverse impact to which a client may be subject. Debt Instruments. Our firm generally invests client cash balances in money market funds, FDIC Insured Certificates of Deposit, high-grade commercial paper and/or government backed debt instruments. Ultimately, our firm tries to achieve the highest return on client cash balances through relatively low-risk conservative investments. In most cases, at least a partial cash balance will be maintained in a money market account so that our firm may debit advisory fees for our services related to our Wrap Fee Program. Common Stocks and Equity-Related Securities. Prices of common stock react to the economic conditions of the company that issued the security, industry and market conditions, and other factors and may fluctuate widely. Investments related to the value of stocks may rise and fall based on an issuer’s actual and anticipated earnings, changes in management, the potential for takeovers and acquisitions, and other economic factors. Similarly, the value of other equity-related securities, including preferred stock, warrants and options may also vary widely. Small- and Mid-Cap Risks. Securities of small-cap issuers may present greater risks than those of large-cap issuers. For example, some small- and mid-cap issuers often have limited product lines, markets, or financial resources. They may be subject to high volatility in revenues, expenses and earnings. Their securities may be thinly traded, may be followed by fewer investment research analysts and may be subject to wider price swings and thus may create a greater chance of loss than ADV Part 2A – Firm Brochure Page 10 Red Crane Wealth Management  when investing in securities of larger-cap issuers. The market prices of securities of small- and mid- cap issuers generally are more sensitive to changes in earnings expectations, to corporate developments and to market rumors than are the market prices of large-cap issuers. Derivative Investments. ETFs The prices of derivative instruments, including futures and options, are highly volatile. Price movements of futures and options contracts are influenced by, among other things, interest rates, changing supply and demand relationships, trade, fiscal, monetary and exchange control programs and policies of governments, and national and international political and economic events and policies. The value of futures and options also depends upon the price of the commodities underlying them. In addition, client assets are also subject to the risk of the failure of any of the exchanges on which its positions trade or of its clearinghouses or counterparties. Exchange Traded Funds. Exchange-traded funds (“ ”) are a type of index fund bought and sold on a securities exchange. The risks of owning an ETF generally reflect the risks of owning the underlying securities they are designed to track, although lack of liquidity in an ETF could result in it being more volatile and ETFs have management fees that increase their costs. ETFs are also subject to other risks, including: (i) the risk that their prices may not correlate perfectly with changes in the underlying index; and (ii) the risk of possible trading halts due to market conditions or other reasons that, in the view of the exchange upon which an ETF trades, would make trading in the ETF inadvisable. Investments in Private Funds. If a client invests in private funds, the client is subject to the risks of the underlying funds’ investments and subject to the underlying funds’ expenses. There can be no assurance that the other funds will achieve their objectives or avoid substantial losses. Alternative Investments: Hedge funds, commodity pools, Real Estate Investment Trusts (“REITs”), Business Development Companies (“BDCs”), and other alternative investments involve a high degree of risk and can be illiquid due to restrictions on transfer and lack of a secondary trading market. They can be highly leveraged, speculative and volatile, and an investor could lose all or a substantial amount of an investment. Alternative investments may lack transparency as to share price, valuation and portfolio holdings. Complex tax structures often result in delayed tax reporting. Compared to mutual funds, hedge funds and commodity pools are subject to less regulation and often charge higher fees and may require “capital calls” which would require additional investment. Alternative investment managers typically exercise broad investment discretion and may apply similar strategies across multiple investment vehicles, resulting in less diversification. Highly Volatile Markets. The prices of financial instruments can be highly volatile. Price movements of forward and other derivative contracts are influenced by, among other things, interest rates, changing supply and demand relationships, trade, fiscal, monetary and exchange control programs and policies of governments, and national and international political and economic events and policies. Clients are also subject to the risk of failure of any of the exchanges on which their positions trade or of its clearinghouses. Use of Leverage and Financing. A client may pledge its securities in order to borrow additional funds for investment purposes. Any event which adversely affects the value of an investment by the client would be magnified to the extent the client is leveraged. The cumulative effect of the use of leverage by a client in a market that moves adversely to the client’s investments could result in a substantial loss that would be greater than if the client were not leveraged. ADV Part 2A – Firm Brochure Page 11 Red Crane Wealth Management  Hedging Transactions. While a client may enter into hedging transactions to seek to reduce risk, such transactions may result in a poorer overall performance for the client than if it had not engaged in any such hedging transactions. For a variety of reasons, our firm may not seek to establish a perfect correlation between such hedging instruments and the portfolio holdings being hedged. Such imperfect correlation may prevent a client from achieving the intended hedge or expose the client to risk of loss. Derivatives and Hedging. Derivatives are financial instruments or arrangements in which the risk and return are related to changes in the value of other assets, reference rates or indices. A client’s ability to profit or avoid risk through investment or trading in derivatives will depend on Red Crane’s ability to anticipate changes in the underlying assets, reference rates or indices. Risks of Investments in Options. Investing in options can provide greater potential for profit or loss than an equivalent investment in the underlying asset. The value of an option may decline because of a change in the value of the underlying asset relative to the strike price, the passage of time, changes in the market’s perception as to the future price behavior of the underlying asset, or any combination thereof. In the case of the purchase of an option, the risk of loss of an investor’s entire investment (i.e., the premium paid plus transaction charges) reflects the nature of an option as a wasting asset that may become worthless when the option expires. Where an option is written or granted (i.e., sold) uncovered, the seller may be liable to pay substantial additional margin, and the risk of loss is unlimited, as the seller will be obligated to deliver, or take delivery of, an asset at a predetermined price which may, upon exercise of the option, be significantly different from the market value. Short Selling. Short selling involves selling securities which are not owned and borrowing them for delivery to the purchaser, with an obligation to replace the borrowed securities at a later date. Short selling allows the investor to profit from declines in market prices to the extent such decline exceeds the transaction costs and the costs of borrowing the securities. A short sale creates the risk of a theoretically unlimited loss, in that the price of the underlying security could theoretically increase without limit, thus increasing the cost to the client of buying those securities to cover the short position. There can be no assurance that the securities necessary to cover a short position are available for purchase at or near prices quoted in the market. Purchasing securities to close out the short position can itself cause the price of the securities to rise further, thereby exacerbating the loss. Inverse Exchange Traded Funds : An ETF traded on a public stock market, which is designed to perform as the inverse of whatever index or benchmark it is designed to track. These funds work by using short selling, trading derivatives such as futures contracts, and other leveraged investment techniques. Investing in inversion ETFs is similar to holding various short positions, or using a combination of advanced investment strategies to profit from falling prices. Also known as a "Short ETF," or "Bear ETF." Inverse ETFs along with other ETFs that use derivatives, typically are not used as long-term investments. Many inverse ETFs utilize daily futures contracts to produce their returns, and this frequent trading often increases fund expenses. Inverse and leveraged inverse ETFs tend to have higher expense ratios than standard index ETFs, since the funds are by their nature actively managed; these costs can eat away at performance. An inverse ETF needs to buy when the market rises and sell when it falls in order to maintain a fixed leverage ratio. This results in a volatility loss proportional to the market variance. Compared to a short position with identical initial exposure, the inverse ETF will therefore usually deliver inferior returns. The exception is if the market declines significantly on low volatility so that the capital gain outweighs the volatility loss. Such large declines benefit the inverse ETF because the relative exposure of the short position drops as the market falls. Since the risk of the inverse ETF and a fixed short position will differ significantly as the index drifts ADV Part 2A – Firm Brochure Page 12 Red Crane Wealth Management  away from its initial value, differences in realized payoff have no clear interpretation. It may therefore be better to evaluate the performance assuming the index returns to the initial level. In that case an inverse ETF will always incur a volatility loss relative to the short position. As with synthetic options, leveraged ETFs need to be frequently rebalanced. These strategies are generally designed for intra-day trading, however may be held for longer durations in cases we deem it prudent to do so. Compounding Risk : Compounding risk is one of the main types of risks affecting inverse ETFs. Inverse ETFs held for periods longer than one day are affected by compounding returns. Since an inverse ETF has a single-day investment objective of providing investment results that are one times the inverse of its underlying index, the fund's performance likely differs from its investment objective for periods greater than one day. Investors who wish to hold inverse ETFs for periods exceeding one day must actively manage and rebalance their positions to mitigate compounding risk. The effect of compounding returns becomes more conspicuous during periods of high market turbulence. During periods of high volatility, the effects of compounding returns cause an inverse ETF's investment results for periods longer than one single day to substantially vary from one times the inverse of the underlying index's return. Derivative Securities Risk : Many inverse ETFs provide exposure by employing derivatives. Derivative securities are considered aggressive investments and expose inverse ETFs to more risks, such as correlation risk, credit risk and liquidity risk. Swaps are contracts in which one party exchanges cash flows of a predetermined financial instrument for cash flows of a counterparty's financial instrument for a specified period. Swaps on indexes and ETFs are designed to track the performances of their underlying indexes or securities. The performance of an ETF may not perfectly track the inverse performance of the index due to expense ratios and other factors, such as negative effects of rolling futures contracts. Therefore, inverse ETFs that use swaps on ETFs usually carry greater correlation risk and may not achieve high degrees of correlation with their underlying indexes compared to funds that only employ index swaps. Additionally, inverse ETFs using swap agreements are subject to credit risk. A counterparty may be unwilling or unable to meet its obligations and, therefore, the value of swap agreements with the counterparty may decline by a substantial amount. Derivative securities tend to carry liquidity risk, and inverse funds holding derivative securities may not be able to buy or sell their holdings in a timely manner, or they may not be able to sell their holdings at a reasonable price. Correlation Risk: Inverse ETFs are also subject to correlation risk, which may be caused by many factors, such as high fees, transaction costs, expenses, illiquidity and investing methodologies. Although inverse ETFs seek to provide a high degree of negative correlation to their underlying indexes, these ETFs usually rebalance their portfolios daily, which leads to higher expenses and transaction costs incurred when adjusting the portfolio. Moreover, reconstitution and index rebalancing events may cause inverse funds to be underexposed or overexposed to their benchmarks. These factors may decrease the inverse correlation between an inverse ETF and its underlying index on or around the day of these events. Futures contracts are exchange-traded derivatives that have a predetermined delivery date of a specified quantity of a certain underlying security, or they may settle for cash on a predetermined date. With respect to inverse ETFs using futures contracts, during times of backwardation, funds roll their positions into less-expensive, further-dated futures contracts. Conversely, in contango markets, funds roll their positions into more-expensive, further-dated futures. Due to the effects of negative and positive roll yields, it is unlikely for inverse ETFs invested in futures contracts to maintain perfectly negative correlations to their underlying indexes on a daily basis. ADV Part 2A – Firm Brochure Page 13 Red Crane Wealth Management  Short Sale Exposure Risk : Inverse ETFs may seek short exposure through the use of derivative securities, such as swaps and futures contracts, which may cause these funds to be exposed to risks associated with short selling securities. An increase in the overall level of volatility and a decrease in the level of liquidity of the underlying securities of short positions are the two major risks of short selling derivative securities. These risks may lower short-selling funds' returns, resulting in a loss. Limited Diversification. Investments may be primarily focused geographically in North American countries. Furthermore, broad diversification of investments in number or by industry or geography is not a primary investment of [Abbreviated Firm Name]. This limited diversity could expose clients to losses disproportionate to market movements in general if there are disproportionately greater adverse price movements in those investments. Non-U.S. Securities. Investments in securities of non-U.S. issuers pose a range of potential risks which could include expropriation, confiscatory taxation, imposition of withholding or other taxes on dividends, interest, capital gains or other income, political or social instability, illiquidity, price volatility and market manipulation. In addition, less information may be available regarding securities of non-U.S. issuers, and non-U.S. issuers may not be subject to accounting, auditing and financial reporting standards and requirements comparable to or as uniform as those of U.S. issuers. Counterparty Risk. Transactions may be affected in “over-the-counter” or “interdealer” markets. The participants in such markets are typically not subject to credit evaluation and regulatory oversight as are members of “exchange–based” markets. This exposes clients to the risk that a counterparty will not settle a transaction in accordance with its terms and conditions because of a dispute over the terms of the contract (whether or not bona fide) or because of a credit or liquidity problem, thus causing clients to suffer a loss. More information about the Clients’ investments and the associated risk factors is available in the Constituent Documents. The foregoing list of risk factors does not purport to be a complete enumeration or explanation of every risk involved in an investment with Red Crane. Prospective Investors and Clients should read the entire Brochure as well the Constituent Documents, the Agreement, and other materials that may be provided by Red Crane and consult with their own advisers prior to engaging Red Crane’s services. Item 9: Disciplinary Information There are no legal or disciplinary events that are material to the evaluation of our advisory business or the integrity of our management. Item 10: Other Financial Industry Activities & Affiliations Our firm has no other financial industry activities and affiliations to disclose. Our firm is not registered, nor does it have an application pending to register, as a broker-dealer, registered representative of a broker dealer, futures commission merchant, commodity pool operator, ADV Part 2A – Firm Brochure Page 14 Red Crane Wealth Management  commodity trading advisor, or an associated person of the foregoing entities. Our firm does not recommend or select other investment advisers for our clients. Item 11: Code of Ethics, Participation or Interest in Client Transactions & Personal Trading As a fiduciary, it is an investment adviser’s responsibility to provide fair and full disclosure of all material facts and to act solely in the best interest of each of our clients at all times. Our fiduciary duty is the underlying principle for our firm’s Code of Ethics, which includes procedures for personal securities transaction and insider trading. Our firm requires all representatives to conduct business with the highest level of ethical standards and to comply with all federal and state securities laws at all times. Upon employment with our firm, and at least annually thereafter, all representatives of our firm will acknowledge receipt, understanding and compliance with our firm’s Code of Ethics. Our firm and representatives must conduct business in an honest, ethical, and fair manner and avoid all circumstances that might negatively affect or appear to affect our duty of complete loyalty to all clients. This disclosure is provided to give all clients a summary of our Code of Ethics. If a client or a potential client wishes to review our Code of Ethics in its entirety, a copy will be provided promptly upon request. Our firm recognizes that the personal investment transactions of our representatives demands the application of a Code of Ethics with high standards and requires that all such transactions be carried out in a way that does not endanger the interest of any client. At the same time, our firm also believes that if investment goals are similar for clients and for our representatives, it is logical, and even desirable, that there be common ownership of some securities. 1 In order to prevent conflicts of interest, our firm has established procedures for transactions effected by . In order to monitor compliance with our personal our representatives for their personal accounts trading policy, our firm has pre-clearance requirements and a quarterly securities transaction reporting system for all of our representatives. Neither our firm nor a related person recommends, buys or sells for client accounts, securities in which our firm or a related person has a material financial interest without prior disclosure to the client. Red Crane may recommend that a Wrap Account client invest into the Fund. The Wrap Account client may pay additional investment management fees in connection with such investment. Related persons of our firm may buy or sell securities and other investments that are also recommended to clients. In order to minimize this conflict of interest, our related persons will place client interests ahead of their own interests and adhere to our firm’s Code of Ethics, a copy of which is available upon request. Likewise, related persons of our firm buy or sell securities for themselves at or about the same time they buy or sell the same securities for client accounts. In order to minimize this conflict of interest, our related persons will place client interests ahead of their own interests and adhere to our firm’s Code of Ethics, a copy of which is available upon request. Further, our related persons will refrain from buying 1 For purposes of the policy, our associate’s personal account generally includes any account (a) in the name of our associate, his/her spouse, his/her minor children or other dependents residing in the same household, (b) for which our associate is a trustee or executor, or (c) which our associate controls, including our client accounts which our associate controls and/or a member of his/her household has a direct or indirect beneficial interest in. ADV Part 2A – Firm Brochure Page 15 Red Crane Wealth Management  or selling the same securities prior to buying or selling for our clients in the same day unless included in a block trade. Item 12: Brokerage Practices Custodian & Brokers Used Item 15 Our firm does not maintain custody of client assets (although our firm may be deemed to have Custody custody of client assets if give the authority to withdraw assets from client accounts. See , below). Client assets must be maintained in an account at a “qualified custodian,” generally a broker-dealer or bank. Our firm recommends that clients use the Schwab Advisor Services division of Charles Schwab & Co. Inc. (“Schwab”), a FINRA-registered broker-dealer, member SIPC, as the qualified custodian. Our firm is independently owned and operated, and not affiliated with Schwab. Schwab will hold client assets in a brokerage account and buy and sell securities when instructed. While our firm recommends that clients use Schwab as custodian/broker, clients will decide whether to do so and open an account with Schwab by entering into an account agreement directly with them. Our firm does not open the account. Even though the account is maintained at Schwab, our firm can still use other brokers to execute trades, as described in the next paragraph. How Brokers/Custodians Are Selected • Our firm seeks to recommend a custodian/broker who will hold client assets and execute transactions on terms that are overall most advantageous when compared to other available providers and their services. A wide range of factors are considered, including, but not limited to: • • • • • • • • combination of transaction execution services along with asset custody services (generally without a separate fee for custody) capability to execute, clear and settle trades (buy and sell securities for client accounts) capabilities to facilitate transfers and payments to and from accounts (wire transfers, check requests, bill payment, etc.) breadth of investment products made available (stocks, bonds, mutual funds, exchange traded funds (ETFs), etc.) availability of investment research and tools that assist in making investment decisions quality of services competitiveness of the price of those services (commission rates, margin interest rates, other fees, etc.) and willingness to negotiate them reputation, financial strength and stability of the provider prior service to our firm and our other clients Products & Services Available from Schwab availability of other products and services that benefit our firm, as discussed below (see “ ”) Custody & Brokerage Costs Schwab generally does not charge a separate for custody services, but is compensated by charging commissions or other fees to clients on trades that are executed or that settle into the Schwab account. In addition to commissions, Schwab charges a flat dollar amount as a “prime broker” or “trade away” fee for each trade that our firm has executed by a different broker-dealer but where the securities bought or the funds from the securities sold are deposited (settled) into a Schwab account. ADV Part 2A – Firm Brochure Page 16 Red Crane Wealth Management  These fees are in addition to the commissions or other compensation paid to the executing broker- dealer. Because of this, in order to minimize client trading costs, our firm has Schwab execute most trades for the accounts. Products & Services Available from Schwab Schwab Advisor Services is Schwab’s business serving independent investment advisory firms like our firm. They provide our firm and clients with access to its institutional brokerage – trading, custody, reporting and related services – many of which are not typically available to Schwab retail customers. Schwab also makes available various support services. Some of those services help manage or administer our client accounts while others help manage and grow our business. Schwab’s support services are generally available on an unsolicited basis (our firm does not have to request them) and at no charge to our firm. The availability of Schwab’s products and services is not based on the provision of particular investment advice, such as purchasing particular securities for clients. Here is a more detailed description of Schwab’s support services: Services that Benefit Clients Schwab’s institutional brokerage services include access to a broad range of investment products, execution of securities transactions, and custody of client assets. The investment products available through Schwab include some to which our firm might not otherwise have access or that would require a significantly higher minimum initial investment by firm clients. Schwab’s services described in this paragraph generally benefit clients and their accounts. Services that May Not Directly Benefit Clients • Schwab also makes available other products and services that benefit our firm but may not directly benefit clients or their accounts. These products and services assist in managing and administering our client accounts. They include investment research, both Schwab’s and that of third parties. This research may be used to service all or some substantial number of client accounts, including accounts not maintained at Schwab. In addition to investment research, Schwab also makes available software and other technology that: • • • • provides access to client account data (such as duplicate trade confirmations and account statements); facilitates trade execution and allocate aggregated trade orders for multiple client accounts; provides pricing and other market data; facilitates payment of our fees from our clients’ accounts; and assists with back-office functions, recordkeeping and client reporting. Services that Generally Benefit Only Our Firm Schwab also offers other services intended to help manage and further develop our business enterprise. These services include: • • • • educational conferences and events technology, compliance, legal, and business consulting; publications and conferences on practice management and business succession; and access to employee benefits providers, human capital consultants and insurance providers. ADV Part 2A – Firm Brochure Page 17 Red Crane Wealth Management  Schwab may provide some of these services itself. In other cases, Schwab will arrange for third-party vendors to provide the services to our firm. Schwab may also discount or waive fees for some of these services or pay all or a part of a third party’s fees. Schwab may also provide our firm with other benefits, such as occasional business entertainment for our personnel. Irrespective of direct or indirect benefits to our client through Schwab, our firm strives to enhance the client experience, help clients reach their goals and put client interests before that of our firm or associated persons. Our Interest in Schwab’s Services. The availability of these services from Schwab benefits our firm because our firm does not have to produce or purchase them. Our firm does not have to pay for these services, and they are not contingent upon committing any specific amount of business to Schwab in trading commissions or assets in custody. In light of our arrangements with Schwab, a conflict of interest exists as our firm may have incentive to require that clients maintain their accounts with Schwab based on our interest in receiving Schwab’s services that benefit our firm rather than based on client interest in receiving the best value in custody services and the most favorable execution of transactions. As part of our fiduciary duty to our clients, our firm will endeavor at all times to put the interests of our clients first. Clients should be aware, however, that the receipt of economic benefits by our firm or our related persons creates a potential conflict of interest and may indirectly influence our firm’s choice of Schwab as a custodial recommendation. Our firm examined this potential conflict of interest when our firm chose to recommend Schwab and have determined that the recommendation is in the best interest of our firm’s clients and satisfies our fiduciary obligations, including our duty to seek best execution. In seeking best execution, the determinative factor is not the lowest possible cost, but whether the transaction represents the best qualitative execution, taking into consideration the full range of a broker-dealer’s services, including the value of research provided, execution capability, commission rates, and responsiveness. Although our firm will seek competitive rates, to the benefit of all clients, our firm may not necessarily obtain the lowest possible commission rates for specific client account transactions. Our firm believes that the selection of Schwab as a custodian and broker is the best interest of our clients. It is primarily supported by the scope, quality and price of Schwab’s services, and not Schwab’s services that only benefit our firm. Private Fund: With respect to the Fund, Red Crane will always have discretion as to the placement of brokerage (and accordingly, the commission rates paid). In selecting brokers to effect portfolio transactions, our firm will consider the factors listed above. Item 13: Review of Accounts or Financial Plans Wrap Comprehensive Portfolio Management: Our financial advisors review accounts on at least a quarterly basis for clients subscribing to our Wrap Fee Program and Third Party Money Management. The nature of these reviews is to learn ADV Part 2A – Firm Brochure Page 18 Red Crane Wealth Management  whether client accounts are in line with their investment objectives, appropriately positioned based on market conditions, and investment policies, if applicable. Our firm does not provide written reports to clients, unless asked to do so. Verbal reports to clients take place on at least an annual basis when our Wrap Fee Program and Third Party Money Management clients are contacted. Private Fund: Jeffrey Wu reviews the Fund’s portfolio on a periodic basis to ensure consistency with the Fund’s strategy and performance objectives. Asset allocation, cash management, market prospects and individual issue prospects are considered. Investors in the Fund will generally receive unaudited reports of performance quarterly and will receive audited year-end financial statements annually. Our firm may review client accounts more frequently than described above. Among the factors which may trigger an off-cycle review are major market or economic events, the client’s life events, requests by the client, etc. Financial Planning & Consulting: Financial Planning & Consulting clients do not receive reviews of their written plans unless they take action to schedule a financial consultation with us. Our firm does not provide ongoing services to financial planning clients, but are willing to meet with such clients upon their request to discuss updates to their plans, changes in their circumstances, etc. Financial Planning clients do not receive written or verbal updated reports regarding their financial plans unless they separately engage our firm for a post-financial plan meeting or update to their initial written financial plan. Item 14: Client Referrals & Other Compensation (see Item 12 – Brokerage Practices) Our firm receives economic benefit from Schwab in the form of the support products and services made available to our firm and other independent investment advisors that have their clients maintain accounts at Schwab. These products and services, how they benefit our firm, and the related conflicts of interest are described above . The availability of Schwab’s products and services is not based on our firm giving particular investment advice, such as buying particular securities for our clients. In accordance with Rule 206 (4)-1 of the Investment Advisers Act of 1940, our firm does not provide cash or non-cash compensation directly or indirectly to unaffiliated persons for testimonials or endorsements (which include client referrals). Item 15: Custody While our firm does not maintain physical custody of client assets (which are maintained by a qualified custodian, as discussed above), we are deemed to have custody of certain client assets if given the authority to withdraw assets from client accounts, as further described below under “Third Party Money Movement.” All of our clients receive account statements directly from their qualified custodian(s) at least quarterly upon opening of an account. We urge our clients to carefully review these statements. Additionally, if our firm decides to send its own account statements to clients, such ADV Part 2A – Firm Brochure Page 19 Red Crane Wealth Management  statements will include a legend that recommends the client compare the account statements received from the qualified custodian with those received from our firm. Clients are encouraged to raise any questions with us about the custody, safety or security of their assets and our custodial recommendations. With respect to the Fund because Red Crane is the general partner of the Fund, Red Crane is considered to have “custody” of the Fund’s assets, even though independent custodians actually hold those assets. That rule generally requires investment advisers that have “custody” of Client assets to cause certain account statements detailing holdings and transactions to be sent to Clients, and imposes certain other obligations. However, advisers to investment funds like the Fund need not comply with those requirements if, the adviser follows safeguarding procedures. Red Crane follows the safeguarding procedures by, among other things, sending quarterly statements to an independent party who has been engaged to approve all fees, expenses, and capital withdrawals from the account. The Fund provides Investors with audited financial statements within 120 days of year-end and those financial statements meet certain requirements. Red Crane satisfies those conditions and therefore is not subject to reporting and other obligations for the Fund. Clients are encouraged to raise any questions with us about the custody, safety or security of their assets and our custodial recommendations. Third Party Money Movement: On February 21, 2017, the SEC issued a no-action letter (“Letter”) with respect to Rule 206(4)-2 (“Custody Rule”) under the Investment Advisers Act of 1940 (“Advisers Act”). The letter provided guidance on the Custody Rule as well as clarified that an adviser who has the power to disburse client funds to a third party under a standing letter of authorization (“SLOA”) is deemed to have custody. As such, our firm has adopted the following safeguards in conjunction with our custodian: • • • • • • • The client provides an instruction to the qualified custodian, in writing, that includes the client’s signature, the third party’s name, and either the third party’s address or the third party’s account number at a custodian to which the transfer should be directed. The client authorizes the investment adviser, in writing, either on the qualified custodian’s form or separately, to direct transfers to the third party either on a specified schedule or from time to time. The client’s qualified custodian performs appropriate verification of the instruction, such as a signature review or other method to verify the client’s authorization, and provides a transfer of funds notice to the client promptly after each transfer. The client has the ability to terminate or change the instruction to the client’s qualified custodian. The investment adviser has no authority or ability to designate or change the identity of the third party, the address, or any other information about the third party contained in the client’s instruction. The investment adviser maintains records showing that the third party is not a related party of the investment adviser or located at the same address as the investment adviser. The client’s qualified custodian sends the client, in writing, an initial notice confirming the instruction and an annual notice reconfirming the instruction. Item 16: Investment Discretion ADV Part 2A – Firm Brochure Page 20 Red Crane Wealth Management  Clients provide our firm with investment discretion on their behalf, pursuant to an executed Constituent Documents. By granting investment discretion, our firm is authorized to execute securities transactions, determine which securities are bought and sold, and the total amount to be bought and sold. Limitations may be imposed by the client in the form of specific constraints on any of these areas of discretion with our firm’s written acknowledgement. Item 17: Voting Client Securities Wrap Comprehensive Portfolio Management : With respect to our Wrap Account clients, our firm does not accept the proxy authority to vote client securities. Clients will receive proxies or other solicitations directly from their custodian or a transfer agent. In the event that proxies are sent to our firm, our firm will forward them to the appropriate client and ask the party who sent them to mail them directly to the client in the future. Clients may call, write or email us to discuss questions they may have about particular proxy votes or other solicitations. Private Fund: With respect to the Fund, Red Crane exercises voting authority over proxies and has adopted proxy voting policies and procedures, which requires Red Crane to vote proxies received in a manner consistent with the best interests of the Fund. The policies also require Red Crane to vote proxies in a prudent and diligent manner intended to enhance the economic value of the assets of the Fund. However, the policies permit Red Crane to abstain from voting proxies in the event that the Fund’s economic interest in the matter being voted upon is limited relative to the Fund’s overall portfolio or Financial Planning & Consulting: the impact of the vote will not have an effect on its outcome or on the Fund’s economic interests. With respect to our Financial Planning & Consulting clients, our firm does not accept the proxy authority to vote client securities. Clients will receive proxies or other solicitations directly from their custodian or a transfer agent. In the event that proxies are sent to our firm, our firm will forward them to the appropriate client and ask the party who sent them to mail them directly to the client in the future. Clients may call, write or email us to discuss questions they may have about particular proxy votes or other solicitations. Item 18: Financial Information • Our firm is not required to provide financial information in this Brochure because: • • • Our firm does not require the prepayment of more than $1,200 in fees and six or more months in advance. Our firm does not take custody of client funds or securities. Our firm does not have a financial condition or commitment that impairs our ability to meet contractual and fiduciary obligations to clients. Our firm has never been the subject of a bankruptcy proceeding. ADV Part 2A – Firm Brochure Page 21 Red Crane Wealth Management