What is a Fiduciary? | Personal Wealth Management | Fisher Investments (2024)

Many financial professionals earn some or all of their money from commissions, sales charges and other fees linked tobuying and selling particular investment products. This can create a conflict of interest—an incentive torecommend products or services that can lucratively compensate the financial professional, even if these productsand services may not necessarily be in your best interests. This can also make it hard to understand how muchyou’re actually paying.

Brokers and other financial professionals often have multiple roles: sales, research, day-to-day operational tasks,client service calls, staff management and so on. That means they might need to manage hundreds of clientrelationships. These factors can make it difficult for them to keep up with all of theirresponsibilities—or to master any one of them. A financial professional with a wide range of responsibilitiesmight not proactively keep you up-to-date with the latest market and portfolio changes or regularly check in todiscuss changes to your personal situation.

You have unique goals for your investments, and your portfolio should be tailored to help you achieve them. There are many factors that should help drive portfolio decisions, including financial goals, time horizon, age, personal preferences, and understanding of and preferences for investment risk. Many financial professionals focus on some of these factors, but few provide comprehensive and ongoing personalized portfolio constructionand maintenance services. Even fewer provide clients with the resources and support they need to maintain investing discipline over time.

Some financial professionals often aren’t the actual decision makers for their clients’ investments. A broker might recommend owning multiple mutual funds, claiming this would adequately diversify your portfolio. They may even outsource investment management to a third party. This means multiple fund managers’ strategic decisions are combined to determine your overall portfolio success. Each might naturally make different decisions for your portfolio without coordinating their strategies—and without taking your personal financial situation and objectives into account.

We are a fee-only adviser. Our fee is simple: It’s determined by the size of the portfolio we manage for you. This aligns our incentives with yours—we do better when you do better. While you pay transaction charges directly to a third-party custodian who holds your investments, we do not receive those commissions. So while some financial professionals may call you to sell products or earn sales commissions, we only trade in your portfolio when we believe it is in your best interest based on our forward-looking market forecast.

Since we began managing discretionary assets in 1979, we’ve been structured to minimize conflicts of interest common in our industry. We intentionally separated our sales, client service and portfolio management responsibilities, allowing us to focus our employees' efforts and build efficiencies in each area. We are solely an investment manager and we do not engage in other business activities such as investment banking, insurance sales, custodial services, or other activities that attempt to sell you additional financial products. This specialization and investment management focus helps ensure our clients’ best interests and long-term goals are best served.

We work with third-party custodians to house our clients’ assets. This relationship helps provide transparency consistent with our fiduciary duties and instill trust in our asset management relationships. When Fisher Investments first began managing client assets, our founder Ken Fisher knew that having an independent third party who provides regular client reporting was crucial to fostering client relationships. This means that, though Fisher Investments generates its own client reports, your custodian also provides regular reporting for your accounts, so you know what’s going on.

We believe good investment advice focuses on your long-term goals and your best interests as a client, which is why we offer a holistic approach to help you reach your long-term financial goals. As a client, you have access to an array of services. Whether it’s helping define our initial investment strategy, mapping out the impact of different investment decisions, helping create an estate plan or even navigating life’s major non-financial decisions—like transitioning into retirement—we can help. We take the time to understand you, your family and your overall financial situation. Then, we work with you to help identify and evaluate your investment goals and objectives so we can provide resources and help you take specific, actionable steps toward achieving your goals.