Practices of Trustworthy Advisors
If you are looking for a financial or investment advisor, finding a CFA charterholder is a good start. No credential is as widely regarded in the global financial industry for its rigorous focus on current investment knowledge, analytical skill, and ethical standards as the Chartered Financial Analyst designation. With more than 100,000 CFA charterholders in over 135 countries and territories and an increasing demand worldwide for the CFA® Program, the charter has become the global professional investment credential.
Here are some key considerations when choosing an advisor:
- Does your Advisor have a track record of honest, competent and ethical conduct that complies with the law?
- CFA charter holders are required to attest annually that they are in compliance with the Statement of Professional conduct and disclose any complaints, litigation, arbitration, or regulatory actions regarding their professional conduct. If so, an investigation is undertaken and the advisor may lose the right to use the CFA designation.
- If your advisor is a registered Research Broker, Brokerage Firm, Investment Adviser Representatives or Investment Adviser Firm, you may use FINRA BrokerCheck®.
- Does your Advisor have sufficient training and knowledge to make an informed analysis?
- What training and education does your advisor have?
- What resources – analyses, databases, research – does your advisor utilize?
Advantages of a CFA® charterholder:
- CFA charterholders must have 4 years of investment experience, have an undergraduate degree, and pass three 6 hour examinations. These exams cover valuation of equity, fixed income, and derivative investments, financial reporting and analysis, portfolio management, economics, and ethics.
- The CFA Society of Washington regularly updates members through professional education events.
- Has your Advisor taken the time to understand you? Has he or she ….
- asked about your investment goals and financial needs?
- made a thorough analysis of your circumstances?
- written an Investment Policy Statement just for you?
- analyzed multiple products to determine which best meets your needs?
- provided analysis to support investment recommendations to you?
- Has your Advisor explained in clear, understandable terms how he/she will be compensated? Make sure you know how is your Advisor is being compensated.
- Is the explanation of fees, commissions, and other charges written in clear, understandable terms?
- Do you understand all other fees charged?
- Have your questions been answered?
- Does your Advisor put your interests first? Investment advisors can have potential conflicts of interest depending on how they are compensated.
- How are the products that he or she recommends selected? How do they compare with other similar products in terms of cost? Sales fees?
- Are the fees that you pay similar to other clients of similar size?
- What policies does the firm have to handle potential conflicts of interest?
Why select CFA Charterholder? They adhere to:
- A strict code of ethics and professional standards. A charterholder not only has the technical knowledge to make investment decisions but also adopts and is held to the highest ethical standards.
- Global best practices and real-world experience. The CFA Program curriculum is based on an extensive and ongoing global practice analysis process, which ensures that the program stays current and relevant in relation to the ever-changing dynamics of global professional investment practice.
- Breadth of knowledge and expertise. A comprehensive, global view and up-to-date practical skills give these investment professionals the tools and deep understanding necessary to effectively analyze the risks and rewards of a variety of investment types, enabling them to address a client’s specific investment needs.
Click below to view CFA charterholders, some of whom are advisors, who support the Statement of Investor Rights..
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