Does Your Investment Advisor Have a Conflict?

Does Your Investment Advisor Have a Conflict?

March 08, 2013

Which type of investment advisor is best for you: a small, independent financial advisor or the private client group of a large national firm? A recent New York Times article (“Selling the Home Brand”) reveals abuses that are possible when a large national firm manages client investments and, at the same time, markets its own investment products.

The article concerned a large national bank that manages portfolios for high net worth clients. Quotes from the article,

  • The firm “pressures brokers to sell the bank’s own products”
  • “ ‘We were not able to do the right things for our clients,’”
  • To bolster sales, said the advisers… [the firm] ‘largely pushes its own bank-branded investments, which include a mix of mutual funds”
  • “Current and former brokers contend that the bank, at times, prioritized profit to the detriment of its clients.”

The company in question denies the allegations.

Arthur Stein Financial, LLC is free from these types of conflicts. We have no incentive to recommend one type of investment over another. Investment management compensation is solely based upon a percentage of investment assets. Growing those assets benefits Arthur Stein Financial as well as our clients.


This presentation is for educational purposes only. To learn more about the topics mentioned and if they are suitable for you, consult an appropriate professional before implementing. Tax laws can change at any time.

Any information provided in this presentation has been prepared from sources believed to be reliable, but is not guaranteed and is not a complete summary or statement of all available data necessary for making an investment decision. Any information provided is for information purposes only and does not constitute a recommendation.

Arthur Stein Financial, LLC also sells life, disability and long-term care insurance. the firm does not have a fiduciary relationship with clients for the sale of these insurance products. Clients should be aware that these services pay a commission and involve a conflict of interest, as commissionable products conflict with the fiduciary duties of a registered investment adviser.

Keep in mind that:

  • Past performance is no guarantee of future performance;
  • Investments involve the risk of loss of principal and earnings;
  • ETFs, mutual funds, including money market funds, etc. are not guaranteed in any way by the US Government, the FDIC, a bank or anyone else.
  • “Average annual return” evens out variations in the actual year-to-year returns.
  • ETFs, mutual funds and individual stocks and bonds fluctuate in value and there will always be times when they lose value.
  • None of the information provided by Arthur Stein is necessarily relevant to anyone’s particular situation. Situations differ among individuals and you should not assume that these generalizations or information apply to you.
  • Investments mentioned may not be suitable for all investors.

Arthur Stein Financial, LLC is registered with the states of MD, DC and VA. it is not registered with, nor is it required to be registered with, the Securities and Exchange Commission.