Broker Check

Oakwell PWM - San Antonio, TX

Fiduciary Standard

As a registered investment advisor, Oakwell and its advisors are bound by the Investment Advisor Act of 1940 to a fiduciary standard.  By law, we must at all times act in the best interest of our clients and not in our own.

What is a Fiduciary?

A person legally appointed and authorized to hold assets in trust for another person.  The fiduciary manages the assets for the benefit of the other person rather than for his or her own profit.

What are some of the requirements of a Fiduciary?

As fiduciaries we must adhere to the duties of loyalty and care; we cannot make prohibited transactions and we must avoid conflicts of interest (ex. placing clients in certain investments because they result in higher compensation).   We also must do our best to make sure investment advice is made using accurate and complete information.  In other words, our analysis is to be as thorough and as accurate as possible.

Aren't traditional financial advisors under the same standard? 

Traditional 'financial advisors' are investment brokers who work for a broker-dealer.  Advice given by an investment advisor differs in some fundamental ways not often understood by the investing public.  Investment brokers are not held to a fiduciary standard, rather they must only fulfill a suitability obligation when making a recommendation.  In other words, the broker must have reason to believe the investment is suitable for you, though it may not be in your best interest.

Are there any other differences?

Another key distinction is in terms of loyalty in that a broker's duty is to the employing broker-dealer, not necessarily to the client.  As investment advisors, our duty and loyalty is to the client first.