The Hill News

By January 21, the Securities and Exchange Commission will release a study on the feasibility of applying a uniform fiduciary standard of care to both investment advisers and brokers who provide personalized investment advice to individual retail investors. The results of this study, which was mandated by the Dodd-Frank Act, will have a profound effect on individual retail investors, especially the level of protection they receive and the array of investment choices offered by their financial advisor
 
Brokers and investment advisors work under very different business models and, because of that, are regulated by different laws.  Investment advisors provide only one service -- investment advice for which they normally charge a fee based on the assets under management. Brokers not only provide investment advice, they also underwrite stock and bond offerings, advise institutional clients on mergers and acquisitions, and make markets for certain assets.  Contrar! y to investment advisors, brokers charge a commission based on the products their clients purchase.

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