HighTower Advisors has created a great video comparing investment brokers with fiduciaries.

A broker is someone who takes a fee in exchange for executing a transaction. They provide a service in return for compensation. For the most part, a broker is not a fiduciary. However, brokers – depending on where they reside, professional qualifications, company, regulatory oversight, etc. – may have certain duties of care to their clients.

A fiduciary is someone with a legal duty of care to the client. It is more than simply executing transactions. More as if the fiduciary steps into your shoes to try and best meet your needs.

It is an important distinction. Make certain that you always know whether you are dealing with a fiduciary or not. I am not saying never to deal with a non-fiduciary. Only that you know the difference between the two. And, if appropriate, take steps to safeguard your best interests over those of your representative (agent, banker, broker, financial planner, etc.).

Now to the HighTower video.  (more…)

Choosing an Online Broker – Part II

In Part I we looked at a few areas of concern when comparing online brokers: reputation and reviews; minimum funding levels; available methods to make trades; commissions; fees.

All important and fairly obvious.

Today we will look at a few more areas to compare online brokerage firms.

Some of these may be less obvious, but I think they are also important for investors. Especially those that wish to create cost effective, well diversified investment portfolios.   (more…)

Choosing an Online Broker – Part I

For most investors, I believe using an online brokerage firm is the best way to invest.

Online brokers provide the most cost-effective means to invest and the services provided should meet the needs of almost all individuals.

In researching candidates to take your money, you have many choices.

At times, it is difficult to compare options. There are numerous special offers for new clients. There are also preferential pricing and services dependent on your trading activity level, your amount of assets, the trading platform you choose, etc. And many twists to the prices and services are buried in the fine print.

All this serves to (intentionally) make comparisons a challenge.

Today I will look at a few initial considerations when comparing firms. In my examples, I am using current data from each broker’s US website unless otherwise stated.

(more…)

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