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  1. #1
    Join Date
    May 2008
    Location
    USA
    Posts
    14

    Default Re: Will A Bankruptcy Disqualify Me For SEC Licensing

    A broker is nothing more than a glorified salesperson. I was trained by what was in 1986 the largest brokerage on the planet, who at the time had what was regarded as the best training program in the business. They spent 95% of the time teaching us how to bring new money into the firm and 5% on managing investments.

    Brokers are trained to sell packaged products - preferably proprietary packed products. Back then it was mutual funds. Today the packaged product is "managed money." It's all about putting lipstick on the pig.

    What a broker learns about managing portfolios comes from experience as it is like any job: You learn to do the job by doing the job with other people's life savings.

    The broker is simply an AGENT, period. Marking buy and sell tickets as "unsolicited" was preferred by the firm and "solicited" orders had to have a trail of notes backing it up.

    You say $50,000 was chump change. Sometimes it is and sometimes it's not, depending on what type investment the investor let's the broker invest the money in. A $50,000 CD investment might pay the brokerage firm $500. The same amount in a mutual fund, $2,500. The same amount in a variable annuity, $3,750. You see how this works now?

    That same brokerage firm today does NOT PAY THEIR BROKER on accounts that have less than $100,000 UNLESS the investment is a proprietary investments. That's why the pig ends up with such red lips.

    I could tell you dozens upon dozens of true stories of what goes on within the walls of a brokerage office. The bottom line is, if possible never use a stockbroker. Take your chance with an EXPERIENCED and INDEPENDENT FEE-BASED investment advisor who receives 100% of his income from client fees.

  2. #2
    Join Date
    Nov 2007
    Posts
    811

    Default Re: Will A Bankruptcy Disqualify Me For SEC Licensing

    That's some great advice to both me and the original person. I am familiar with putting lipstick on a pig! I love that term. That and "Hogs get slaughtered!"

    Thanks,

    Bob

  3. #3
    Join Date
    Feb 2008
    Posts
    16

    Default Re: Will A Bankruptcy Disqualify Me For SEC Licensing

    For clarification, I work for an insurance company. The SEC licensing is to sell their life insurance products.

    Many of of the posts were on target, ie; the LAW and COMPANY POLICIES are two different things. The company is the Broker/Dealer and they have to provide the bonding. Regardless of the law they won't bond someone with a BK.

    The bottom line is I am producing and they aren't going to let me go. However, since I can't qualify for their bonding I'm not a full fledged employee and my book isn't really mine.

  4. #4
    Join Date
    May 2008
    Location
    USA
    Posts
    14

    Default Re: Will A Bankruptcy Disqualify Me For SEC Licensing

    I think you'll find that your book is NEVER really yours.

  5. #5
    Join Date
    May 2008
    Location
    USA
    Posts
    14

    Smile Re: Will A Bankruptcy Disqualify Me For SEC Licensing

    [quote=usedbranflakes;209622]That's some great advice to both me and the original person. I am familiar with putting lipstick on a pig! I love that term. That and "Hogs get slaughtered!"

    One more thing to consider when choosing to use a stockbroker or a registered investment advisor is that a stockbroker does NOT have to give you advice that is in your best interest. Yes, that's true...he or she is not legally obligated to do so. On the other hand, a RIA is a fiduciary that is legally obligated to work in your best interests 100% of the time. An advisor's feet are held to the fire for not only what he says to you but what he DOESN'T say to you.

    To cloud the issue, stockbrokers are now being pressured by their firms to obtain the RIA license but that is so they can sell the packaged product called "managed money."

    Here is the kicker (as the pig puckers up): A stockbroker sometimes is dealing with the customer in the role of a stockbroker and other times as an investment advisor. If the broker is recommending his company's latest hot trendy mutual fund (or some other packaged product that he's being pressured to sell) he is NOT acting in a fiduciary capacity, and thus does not have to give you advice that's in your best interest.

    Choose an INDEPENDENT registered investment advisor that works ONLY for management fees AND who does NOT accept any other form of compensation - especially "trail fees" from mutual funds, money market funds, and other sources - from any other source.

    Just ask the advisor: Do you receive any other form of compensation from any other source other than management fees from your clients? If the answer is "yes" then there is a clear conflict of interest, period.

    Some advisors charge quarterly asset-based management fees + they get a cut on trade commissions + they receive trail commission on packaged products like variable annuties, mutual funds, and other products. It's legal AS LONG AS they disclose it to you in writing.

    I could go on and on and on...but I won't. I hope this helps.

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