Investor and Industry Perspectives on Investment Advisers and Broker-Dealers

Abstract

This PDF document was made available as a public service of the RAND Corporation.

In recent years, the evolution of the financial service industry has blurred traditional distinctions between broker-dealers and investment advisers and made it difficult to design appropriate regulatory schemes for their professional services. To better understand the industry’s dynamics and its effects on individual investors, the U.S. Securities and Exchange Commission (SEC) commissioned RAND to conduct a study of broker-dealers and investment advisers from two perspectives: first, examine investment advisers’ and broker-dealers’ practices in marketing and providing financial products and services to individual investors; and second, evaluate investors’ understanding of the differences between investment advisers’ and brokerdealers’ financial products and services, duties, and obligations.

Keywords: financial service, investors, Securities, broker-dealers,investment advisers

JEL Classification: G00, G2, G24, G28, G4