Registered Investment Advisors vs Broker Dealers

There is a difference between a Registered Investment Advisor (RIA) and a Broker Dealer (BD).


Our “fiduciary” duty sets us apart from the rest. A fiduciary is someone that manages money for the benefit of another and is bound by law to place the interest of its beneficiary first and foremost. You would naturally think that anyone giving financial advice would be a fiduciary, but you’d be wrong. Brokers, registered representatives, and most people that call themselves financial advisors are not actually fiduciaries even though they are engaged in marketing themselves as financial advisors. In reality, only a small proportion of “financial advisors” are federally or state-Registered Investment Advisors and most financial advisors are actually considered “Broker-Dealers” by the Securities and Exchange Commission (SEC).


A Registered Investment Advisor, must follow the highest known standard in law, known as the “trust” standard, which means that an RIA is required by law to place the interests of its clients before its own and fulfill critical fiduciary duties in trust and confidence. In other words, the RIA must provide its “best advice”. On the contrary, a broker-dealer does not owe a fiduciary duty to its investment clients, but instead are required by federal law to act in the best interest of their employer instead. In comparison, RIA owes fiduciary duties to its investment clients only. This in turn means that superior service and stewardship can be found at an RIA, with no ulterior or underlying contradictory motives.

Contact Caitlin John, LLC

(810) 588-6162
Fax: (810) 227-2558
Toll Free: (844) 944-1044

Compliance statement:

The information, data, and opinions contained herein this communication are provided solely for informational purposes only. They are not warranted to be correct, complete, or accurate. To the extent permitted by law, Caitlin John does not accept any liability arising from the use of this communication. You should not assume that any information, data, or opinions contained herein serves as the receipt of, or a substitute for, personalized investment advice from Caitlin John or from any other investment professional. Past performance is not an indication of future results and actual results may vary. Investing carriers an inherent element of risk, including the risk of losing invested principal.