Episode Two - Proprietary Investment Products

In reviewing prospective clients' brokerage accounts over the years, we regularly come across portfolio holdings that are inappropriate, disadvantageous, overly complex, and way too expensive.

In this episode of Speaking with Money with FCE Group, listeners will learn:

  • What a proprietary investment product is. The term refers to a situation where a client has an account at a firm and their advisor selects investments created by the firm for which that advisor works.

  • Why proprietary products may lead the advisor to select products that are not in the client's best interests.

  • Alignment of interest between advisor and client and why independent advisors, who select only outside investments, may be more aligned with the client's best interests.

  • Why the way in which your advisor is compensated does matter.

  • Commission versus asset-based management fee arrangements.

  • What you should look for in your accounts to tell if there is a possible conflict of interest from use of proprietary products.

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