Fiduciary vs. Suitability
Wikipedia describes a fiduciary relationship as “is the highest standard of care at either equity or law.” In light of headline news about fraud, MF Global, Madoff-like Ponzi schemes, and the lack of regulatory oversight, we want to emphasize how Durig Capital services clients.
What are the differences our between responsibilities as a Registered Investment Advisor
( “Advisor”), and those of a Registered Representative that is employed by a broker-dealer, also known as a “broker” or “stock broker”?
Durig Capital believes it’s important that you understand differences between an Advisor and a Broker’s legal responsibility and duty. The differing levels of legal responsibilities and duties have a direct bearing on what investments might be recommended to you, and thereby possibly greatly impacting your returns.
Durig Capital is a low cost, fee only, Registered Investment Advisor (RIA.) Under the Securities Act of 1940, Durig Capital is required to fully accept the duty of being a fiduciary, which is to say that we put your interest above our own and declare any possible conflicts of interest that may arise. You can be assured that the investments we select and the portfolios we construct meet our duty to you of putting your interest first. Our only thoughts when selecting investment products for your portfolio is whether they, on their own merit and risk consideration, will provide you with the best returns relative to the risk and meet your financial objectives.
A broker, or Registered Representative, is only required to recommend investments that minimally qualify as “suitable” for you. In other words, as long as an investment qualifies as “suitable,” a broker can legally put his own interest first, even if directly related to his or her person pay. Thus his own personal commission or pay could be his primary interest when recommending a “suitable” investment to you.