Investment Advisory Services
As defined by the Investment Advisers Act of 1940 an investment adviser is, any person or group that makes investment recommendations or conducts securities analysis in return for a fee, whether through direct management of client assets or via written publications. Stockbrokers, whose rendering of investment advice is "incidental to" their function as brokers, are exempt from the definition.
Investment advisors are prohibited from disseminating advice known to be deceitful or fraudulent, and from acting as a principal on their own accounts by buying and selling securities between themselves and a client without prior written consent.
Most investment advisers charge either a flat fee for their services or a percentage of the assets being managed. In most cases, there are fewer conflicts of interest between investment advisors and their clients, because the advisor will only earn more if the clients' asset base grows as a result of the advisor's recommendations and securities selection.