Brokerages - fee based advisors

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Danielle105
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Brokerages - fee based advisors

Post by Danielle105 » 01 Oct 2017 12:10

I am currently in the USA where I use a large low cost brokerage.

I get a call from them about once a year.

When they call it always seems they try to sell me on using an independent fee based advisor, (fee based on size of assets.) Do all of these large low cost brokerages do this?

It's starting to annoy me, to the extent that I may move the account to another brokerage in the future.

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InvestorNewb
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Re: Brokerages - fee based advisors

Post by InvestorNewb » 01 Oct 2017 20:02

I'm with Qtrade and they never call me. If you tell then no and they continue to call once a year, I agree that would annoy me too.
My Portfolio: VTI [US], VXUS [Int'l], VNQ [REIT], VCN [Canada] (largest to smallest)

twa2w
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Re: Brokerages - fee based advisors

Post by twa2w » 01 Oct 2017 23:46

Danielle105 wrote:
01 Oct 2017 12:10
I am currently in the USA where I use a large low cost brokerage.

I get a call from them about once a year.

When they call it always seems they try to sell me on using an independent fee based advisor, (fee based on size of assets.) Do all of these large low cost brokerages do this?

It's starting to annoy me, to the extent that I may move the account to another brokerage in the future.
These companies are not altruistic. What is in it for them to recommend an independant advisoer? Is what they are recommending a sister company or subsidiary? Or do they think the advisor will recommend products within your account that are more lucrative for them?

I should point out this is a Canadian forum.

You can asked to be placed on their do not solicit list if you are otherwise happy with their services.

Danielle105
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Re: Brokerages - fee based advisors

Post by Danielle105 » 02 Oct 2017 17:22

A small portion of the advisors fee, does go back to the brokerage.

jiHymas
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Re: Brokerages - fee based advisors

Post by jiHymas » 04 Oct 2017 02:14

Thank you for posting this.

I run a portion of my investment management business in this manner - using the client's discount brokerage account with a Trading Authority - and I suspect I will have to address the issue of the brokerages wanting a cut of my advisory fees at some point.

I would appreciate learning more about the mechanics of this scheme from anybody who is familiar with this practice.

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