What is a Registered Investment Advisor ? (RIA)

Under the Investment Advisers Act of 1940, Registered investment advisors are held to a fiduciary standard of care. By law, they must ensure that each investment recommendation they make is based on your best interest. In the event that a conflict of interest should arise, RIA's are required to let you know. Additionally, they are required to have a written code of ethics that governs their actions and fully discloses how they are compensated. Registered Investment Advisers (RIAs) offer a more comprehensive set of services, including investment and planning guidance instead of selling financial products. RIAs examine a client’s entire financial picture, assess the client’s goals and determine the time horizon for each set of assets to be invested: retirement, college savings, general investment, etc. After completing this asset allocation function, the adviser then selects appropriate investment vehicles to achieve specific objectives. Another differentiator is that independent advisers often work in coordination with other professionals (i.e., CPAs, Trust and Estate Attorneys, Philanthropic Planners, etc.) on behalf of the client to ensure comprehensive planning. Comprehensive wealth advisers can be thought of as your personal CFO (Chief Financial Officer)

 

Fee Based Compensation, What is it?

It's important to understand exactly how your advisor is compensated. Davies Wealth Management charges a fee based on assets or will a charge a flat fee. This straightforward system is easy to understand, is fully disclosed to you in writing, and provides additional incentive for Davies Wealth Management to grow your assets. By contrast, fee-only advisers do not sell any financial products. They are incentivised, as a fiduciary, to search for the best options for you. They look for low fees, tax efficiency and are not required to use investment vehicles that are favorable to any particular brokerage house. If their clients need products, they work with trusted professionals to find the right products based on the client’s objectives. There is no fee splitting or other incentives in the sale of products, so conflicts of interest are kept to a minimum. A broker, or “Registered Representative” as they are sometimes called, is required only to recommend investments that are “suitable” for their clients. This means that a broker can legally put his or her own interest above yours when recommending financial products for your specific situation.

 

What is a fiduciary?

RIAs are ethically and legally responsible for acting in your best interests at all times, thanks to the Investment Advisers Act of 1940. They serve as fiduciaries, and one definition of a fiduciary is a person who occupies a special trust and confidence when working with clients because he/she is legally required to act ethically and with undivided loyalty to the client.

 

Once a client signs with Davies Wealth Management are they "Locked In" for any specific time?

No, however we do recommend an investment horizon of at least 3-5 years

 

How often can clients expect changes in their portfolio?

Davies Wealth Management has no preconceived time line from which changes are made. Allocation changes are totally dependent upon market, economic and risk based needs.

 

How long has Davies Wealth Management been in business?

We have been helping individuals, corporations, trusts, and pensions achieve their financial goals since 2009

 

What is a Benchmark?

A Benchmark is a standard, usually an un-managed index, used for comparative purposes in assessing portfolio performance. To determine if your portfolio returns are competitive, you would measure them against a benchmark. An appropriate benchmark would be one that is allocated similarly to the portfolio