Regulators are trying to make it less confusing to learn what you need to know about your stockbroker or financial adviser. But that effort could create new confusion of its own.
In a disclosure form newly proposed by the Securities and Exchange Commission, brokers and investment advisers would have to describe their services, their fees and their obligations to act in your best interest. They’d also have to tell you how to research their background and disciplinary history. The dense, four-page customer relationship summary also recommends questions to ask a broker or adviser….
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This article was originally published on The Wall Street Journal.
Further reading
Benjamin Graham, The Intelligent Investor
Jason Zweig, The Devil’s Financial Dictionary
Jason Zweig, Your Money and Your Brain
Jason Zweig, The Little Book of Safe Money
Louis Brandeis, Other People’s Money: And How the Bankers Use It (1913-14)
George Loewenstein, Cass R. Sunstein, and Russell Golman, Disclosure: Psychology Changes Everything (Annual Review of Economics, 2014)
Daylian M. Cain, George Loewenstein and Don A. Moore, The Dirt on Coming Clean: Perverse Effects of Disclosing Conflicts of Interest (Journal of Legal Studies, 2005)
Daylian M. Cain, George Loewenstein, and Don A. Moore, When Sunlight Fails to Disinfect: Understanding the Perverse Effects of Disclosing Conflicts of Interest (Journal of ConsumerResearch, 2010)
Alexander J. Rothman and Norbert Schwarz, Constructing Perceptions of Vulnerability: Personal Relevance and the Use of Experiential Information in Health Judgments (Personality and Social Psychology Bulletin, 1998)
Herbert A. Simon, Designing Organizations for an Information-Rich World (Brookings Institution lecture, 1969)