Think of your relationship with your adviser as a partnership. You both have responsibilities and should be working together to achieve your financial goals. The role of your adviser is to give you helpful, informed advice as you build and carry out your plan. In turn, you can make the relationship productive by being clear and honest about your financial situation and expectations.
To help avoid a potential dispute before it occurs, you should have a clear understanding of your role and responsibilities and your adviser’s role and responsibilities.
Your responsibilities as a client:
• Be clear and honest about your financial situation and expectations
• Be prepared for each meeting by reviewing relevant information before arriving
• Ask questions if you don’t understand something and take notes
• Be informed about your current and potential investments
• Review your transaction confirmations and account statements to make sure they are accurate
• Keep your adviser up to date about any changes in your financial circumstances or life changes that may affect your financial well-being
Your adviser will not be able to:
• Predict the performance of the markets with certainty
• Recommend investments that are always profitable
• Act on vague or general instructions to buy or sell investments
• Meet unrealistic goals or expectations of profit
You can expect your adviser to:
• Make clear and specific recommendations
• Explain the reasons for the recommendations
• Point out the strengths and weaknesses of opportunities and recommendations
• Outline the risks involved
Know What to Expect from Your Registered Investment Adviser – When you open an account with a registered investment adviser, there are important things that you should know about the relationship that you will have with your adviser.
Know What You Pay When You Buy or Sell an Investment – Before your registered investment adviser buys or sells an investment for you, they must tell you the charges you will have to pay for the transaction.
Know Your Investment Account Performance – Every year your financial adviser’s firm must provide you with an investment performance report. This report will list all your investments, the return on your account, the market value of all deposits and withdrawals, the change in market value and rates of return.
Know the Cost of Your Registered Investment Adviser – Every year your investment adviser’s firm must provide you with a charges and compensation report. The report covers account operations costs, transaction costs and amounts paid by third parties.