Quest Investment Firm
  • About Us Working With An Advisor Our Fiduciary Duty What is a RIA? How are we regulated? Safeguarding Assets
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  • Investment Process
  • Our Resources 401k Information FAQ
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Quest Investment Firm
  • About/
    • About Us
    • Working With An Advisor
    • Our Fiduciary Duty
    • What is a RIA?
    • How are we regulated?
    • Safeguarding Assets
  • Services/
  • Investment Process/
  • Resources/
    • Our Resources
    • 401k Information
    • FAQ
  • Contact/
Quest Investment Firm

Our Fiduciary Duty

Quest Investment Firm
  • About/
    • About Us
    • Working With An Advisor
    • Our Fiduciary Duty
    • What is a RIA?
    • How are we regulated?
    • Safeguarding Assets
  • Services/
  • Investment Process/
  • Resources/
    • Our Resources
    • 401k Information
    • FAQ
  • Contact/
 
 

OUR FIDUCIARY DUTY

Working with a Fiduciary: Know the difference, and trust who you're working with.

A Registered Investment Advisor, regulated under the Investment Advisors Act of 1940 is a fiduciary. They must follow the “trust” standard — the highest known in law — which requires them to place the interests of their clients ahead of their own and fulfill critical fiduciary duties of trust and confidence.

Under the fiduciary trust standard, a Registered Investment Advisor must provide its best advice to a client.

Stockbrokers are regulated under the Securities Exchange Act of 1934, are governed by the “suitability” standard and are not fiduciaries. The “suitability” standard does not require a stockbroker to place the interests of its clients ahead of its own. Under this non-fiduciary suitability standard, a stockbroker need provide only suitable advice to its clients — even if the stockbroker knows that the advice is not the best advice and he/she benefits from these recommendations more than alternatives that are better for the client


BROKER MODEL

Suitability

Transactions

Disclosure

“Financial Advisor” at a brokerage house

In-house custody

ADVISOR MODEL

Fiduciary

Advice

Transparency

“Financial Advisor” at a Registered Investment Advisor (RIA)

3rd-party custody

 


In the end, the difference between a stockbroker / registered representative and a Registered Investment Advisor is that the Registered Investment Advisor is subject to the high fiduciary legal standard when providing investment advising services while the stockbroker is not. This could have a significant effect on the quality and composition of your portfolio, the fees that you pay and the eventual performance outcome.

 

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