What is the difference between a broker-dealer and an investment adviser?

A broker-dealer and an investment adviser are two different kinds of professionals who are involved in the investment process. A broker-dealer is a professional who is licensed to buy and sell securities for investors. They provide advice related to the purchase and sale of investments and make a commission when a security is purchased or sold. An investment adviser, on the other hand, is a professional who is registered to offer investment advice. They typically manage the investments of individuals, such as by recommending specific stocks or mutual funds. Investment advisers do not typically buy and sell securities themselves and make money through the management fees they charge. Both broker-dealers and advisers must be registered in the state of Virginia and are subject to investment fraud laws aimed at protecting investors. Broker-dealers and advisers both have a duty to act in the best interests of their clients and must disclose any conflicts of interest that may arise. It is important to understand the differences between a broker-dealer and an investment adviser in order to make sure your investments are being handled properly. Both types of professionals play important roles in the investment process and should be chosen carefully.

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What is the difference between a broker-dealer and an investment adviser?

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