CoreStates commitment to fiduciary responsibility

Today, the world is awash with people who want to sell you investment products and services, and give you investment advice. Many of them have conflicts of interest that they never disclose.

Registered Investment Advisors, on the other hand, have a fiduciary obligation to put your best interests above their own and above the interests of the firms for which they work. When you are choosing your portfolio manager, consider these differences between having an RIA and someone else manage your portfolio:

Fiduciary vs. Advisor - The RIA designation means the adviser is required by the SEC to provide "fiduciary care” – to act in your best interests. Designations such as CFP®, ChFC, CFS and CLU do not establish a fiduciary relationship. Nor do the FINRA registrations – Series 7, Series 65, etc., which require only that recommendations be "suitable”. Stockbrokers are not fiduciaries. They are in the business of selling investments.

Fees vs. Commissions - RIAs do not earn commissions on investment account transactions, and therefore have no incentive to actively trade your account. If a brokerage firm manages your portfolio, their representative typically earns commissions on trades in your account. They are paid for transactions, not advice.

No Products To Push - RIAs don’t create and sell investment products. They have no incentive to recommend to you investments that may not be in your best interests. Other advisors work for firms that manufacture derivatives, collateralized debt obligations (CDOs), or other exotic investment products, and may be expected by their employer to recommend such investments to their customers.

No Companies To Push - RIAs do not provide investment-banking services. They have no incentive to recommend stocks or other securities issued by a specific company. Traditional advisors may represent a firm that does provide investment-banking services. They may be expected to recommend securities underwritten by the firm's investment-banking unit.

Government regulator vs. Trade association - RIAs are registered with and regulated by the Securities and Exchange Commission (SEC) whose mandate is to protect investors. Brokers are not required to register with the SEC. They are usually affiliated with Financial Industry Regulatory Authority (FINRA), the securities industry’s trade group, but not with an independent entity whose primary mission is to protect your interests.

Full disclosure vs. Partial disclosure - The SEC requires all RIAs to disclose all potential conflicts of interest. Brokers and "financial planners" may receive compensation through complex, overlapping and often hidden arrangements, none of which typically relate to your investors success.

Transparent Fee Structure vs. Hidden Fees - RIAs are compensated directly and only from you, with the fee  based on the size of your portfolio.  You both have incentives for your account to grow. Brokers and "financial planners" may receive compensation through complex, overlapping and often hidden arrangements, none of which typically relate to your investment success.