Advisor Account

DEFINITION of 'Advisor Account'

A type of investment account where an investment advisor works closely with a client in formulating and implementing investment purchases and strategies. In most cases, the client has the final say on all investment decisions.

The fee structure of an advisor account is typically asset-based, in which the annual fee paid by the client is based on a percent of the assets held in the account. There are no trading commission fees.

BREAKING DOWN 'Advisor Account'

These types of accounts are generally for investors who would like to take a hands-on approach to their investments but would also like to work with a financial expert. In addition to working with an investment advisor, the client will often have access to a wide range of investments, including IPO stock and lower cost mutual funds.

RELATED TERMS
  1. Investment Advisor

    As defined by the Investment Advisors Act of 1940, any person ...
  2. Know Your Client - KYC

    A standard form in the investment industry that ensures investment ...
  3. Investment Consultant

    An advisor who helps investors with their long-term investment ...
  4. Personal Financial Advisor

    Professionals who help individuals manage their finances by providing ...
  5. Limited Discretionary Account

    A type of account in which a client allows a broker to act on ...
  6. Brochure Rule

    Under the Investment Advisor's Act of 1940, the Brochure Rule ...
Related Articles
  1. Your Practice

    Why Clients Leave Their Advisors

    Clients fire financial advisors for many reasons. Here's a rundown on why they're likely to do so and how to avoid losing any from your roster.
  2. Financial Advisors

    3 Reasons to Fire Your Advisor

    There is no reason for a client to stay with a financial advisor who is not serving his or her needs. Here are some red flags to look out for.
  3. Financial Advisors

    Losing a Client Is Not Always The End of The World

    Losing a client is never pleasant for a financial advisor, but sometimes this is a better outcome than continuing the relationship.
  4. Financial Advisors

    How Financial Advisors Pick Client Investments

    How advisors choose investment portfolios is varied, and investors are wise to check with theirs to find out how he or she makes their investment choices.
  5. Your Practice

    Advisors: How and Why to Justify Your Fees

    In an era of fee compression here's how financial advisors can justify what they charge clients.
  6. Financial Advisors

    Advisors Need to Talk Less, Ask and Listen More

    Financial advisors spend a lot of time giving their clients advice on how to invest their money. But what they often forget to do is listen.
  7. Financial Advisors

    Top Tips for Inheriting a Book of Clients

    Inheriting another advisor's book of clients can be a big boon. Here are some tips on how to handle the transition.
  8. Financial Advisors

    Top 5 Mistakes All Advisors Should Avoid

    Not all advisors are created equal. Here are five common mistakes made by financial advisors and how they can be avoided.
  9. Your Clients

    When to Really Put Your Clients' Interests First

    Advisors and clients alike are best served when a client's revenue is growing. But there may be some cases when taking a small hit is best for the client.
  10. Personal Wealth & Private Banking

    What People Hate About Financial Advisors

    Advisors need to make a living too, but doing so by cutting corners at a client's expense isn't right. Here are the top complaints against advisors.
RELATED FAQS
  1. Do financial advisors get paid by mutual funds?

  2. Do financial advisors work only in banks?

    Learn how financial advisors are employed not only by various financial institutions, such as banks, but an increasing number ... Read Answer >>
  3. How do financial advisors charge fees?

    Learn how financial advisors make their money and how you can make sure they are looking out for your best interests by understanding ... Read Answer >>
  4. What should I do about my IRA that keeps losing money?

    I have a Roth IRA and it keeps losing money and the investment firm never calls to let me know what's happening. It's ... Read Answer >>
  5. What is a trailing commission?

    Very simply, a trailing commission is money you pay an advisor each year that you own an investment. The purpose of the fee ... Read Answer >>
  6. My FA recommended a wrap fee for me, is that appropriate?

Hot Definitions
  1. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  2. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  3. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  4. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  5. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
  6. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
Trading Center