When it comes to financial advice, many stockbrokers, insurance agents and financial advisors would have you believe that all financial advice is created equal; however, this is simply not true. There are several key differences between Registered Investment Advisors, stockbrokers and insurance agents. Furthermore there are differences between the ways fees are charged by different Registered Investment Advisors.
Fiduciary Responsibility
As a Registered Investment Advisors, Capital Management Advisors is bound by a fiduciary responsibility to always act in the best interest of our clients. Any possible conflict of interest that might benefit us over our clients must be fully disclosed. Most brokerage firms are not fiduciaries and may make decisions that are suitable for the clients but not in their best interest.
Public Disclosure
Investment Advisors that manage over $25 million in client assets are required to register with the Securities and Exchange Commission and file disclosure documents annually. All Registered Investment Advisors’ disclosure documents are available online (www.advisorinfo.sec.gov). The searchable IARD number for Capital Management Advisors is 1100447.
Fee-Only Advice
While many Registered Investment Advisors receive fees as well as commissions for their services, CMA is among those who have chosen to provide their services on a fee-only basis. Because CMA compensation is never tied to specific investment products, clients have great assurance that the advice being offered is objective and represents what is in their best interest.
Fraud Protection
While many Registered Investment Advisors choose to custodian client assets themselves, CMA has chosen to utilize the custody services of third party custodians such as Fidelity and TD Ameritrade. This choice provides our clients with assurance that their assets are safeguarded. Clients receive confirmations of every trade and monthly statements directly from the third party custodian.
But don’t take our word for it, read this article from Bloomberg Businessweek discussing the rise of Registered Investment Advisors.
http://www.businessweek.com/magazine/content/11_11/b4219041484091.htm