When managing the financial situation of your company or investments, many different specialists are needed to keep track of all of the moving numbers. This includes managers and brokers of every stripe, two of which are the subject of this article: investment managers and stock brokers. On the surface, these two may seem similar, but there are various differences between the two that gear them toward separate, but equally important tasks. So, if you?re seeking investment management in Attleboro MA, and you want to know the difference between them and stock brokers, the answers are as follows.
An investment manager is a professional manager of your various investments and assets. Unlike investment advisors; a larger organization your investment manager may be a part of, which mainly just advises on a variety of investments, such as stocks, bonds, exchange traded and mutual funds among others, an investment manager advises you on what to do with the investments you choose. Ideally, in a manner best suited to aiding you financially. One of the biggest differences investment managers have between them and stock brokers is that the law holds them to a much higher standard. An investment manager must answer to things such as the investment advisors act of 1940, since they are so closely related to the field of investment advisory.
The source of confusion of the differences between these two positions is a recent one. Because the internet, and with it online trading and direct access to the stock market, came far too close for comfort to rendering the stock broker obsolete, stock brokers started working on more personalized cases typically reserved for investment advisors or managers, in order to justify the high commission prices they would charge. As such, they need to duel-register themselves as both stock brokers and investment advisors/managers in order to do this. In truth, a stock broker?s job is to monitor your investments on the stock exchange, and handle any investments you want to make in the future, in exchange for a fee. While not held to as high a standard as investment advisors, stock brokers still have to register with the U.S. Security and Exchange Commission before being allowed to do their business.
While stock brokers and investment managers have many similarities, giving birth to the presumption that the two are interchangeable, to make such a presumption is misguided. The two jobs are similar, yes, but only on a purely surface level. A stock broker handles investments on the stock market, while an investment manager handles them with you on a personal level. Both are important, however, so if you find yourself in need of an investment advisor, ask them if what you?re looking for will require a stock broker as well.
Be the first to like.