Let us talk about the service given by advisors and
start with the contract between a broking firm and the client.
H: There is a difference between contracts
and the clauses referring to disputes will not be
It pays to obtain a contract before
appointing a broker. If you are doing trades over the internet, eg. 'The
Sharechat Netbroker', then the situation is clearer; after all, you are entering
any buy/sell order yourself.
A well trained broker will recognize a
client's voice; however, it is vital having the broker
repeat the order. Insist on this!
The larger firms use recorders and the
tapes are used where there is a dispute.
I had one concerning an Australian
I think that I could have won but the
advisor had given such excellent service that I decided not to
pursue the matter. After all, I was well ahead with the returns!
G: How do you rate advisors?
H: (1) Those who don't know anything, (2): Those
who think that they know a lot, and(3): Those who do
know a lot but think that they don't know enough!
Group(1) disappeared in the 1987 crash. There are
some in group (2) and you need to be aware of them as they could cost
you money. Obviously, you are responsible for any decisions
following the advice given.
Group(3) often qualify their opinion or give
you supporting material to read. They will never be
G: The client will need to be aware of the
The broking firm, through their advisors, will
support the findings of their own analysts.
When the broker has a company
as a client, then the advisor and the literature should state so
when putting a Buy on a stock;
their share price can sometimes fall a great
deal before a Hold is issued!!!!.
H:I have had some experience with brokers over the
years and found that the best advisors will profile
a client and serve him/her with the literature and advice commensurate with the
level of risk/ reward wanted.
Obviously, you pay for this through fees which
are higher than those charged by a Net
G: And what should a client do before
placing an order?
H: Be at rest; write down the
order; always have the Sh. and
Fin numbers ready when selling!