Blanket Recommendation

AAA

DEFINITION of 'Blanket Recommendation'

A situation in which a financial professional or institution sends a recommendation to all clients to buy or sell a particular security or product, regardless of whether or not the particular asset is compatible with the client's investment goals, objectives and risk tolerance.

INVESTOPEDIA EXPLAINS 'Blanket Recommendation'

Communicating to clients through a blanket recommendation is usually ill-advised because the clients solicited will have varying investment profiles. Imagine if a particular client who is retired and can't afford to lose a lot of money is the recipient of a blanket recommendation and the recommended transaction is of higher risk than what she is used to. Should the client follow the firm's advice, she stands to lose a portion of the savings it has taken her years to accumulate, which would be very difficult to replenish.

RELATED TERMS
  1. Analyst Sponsorship

    A positive endorsement that an analyst makes regarding a company's ...
  2. Full-Service Broker

    A broker that provides a large variety of services to its clients, ...
  3. Risk Neutral

    Indifference to risk. The risk-neutral investor would be in the ...
  4. Risk Lover

    An investor who is willing to take on additional risk for an ...
  5. Investment Advisor

    As defined by the Investment Advisors Act of 1940, any person ...
  6. Risk Averse

    A description of an investor who, when faced with two investments ...
RELATED FAQS
  1. What is the difference between a buy-side analyst and a sell-side analyst?

    The main difference between these two types of analysts is the type of firm that employs them and the people to whom they ... Read Full Answer >>
  2. What impact does inflation have on the time value of money?

    The impact that inflation has on the time value of money is that inflation decreases the value of a dollar over time. The ... Read Full Answer >>
  3. Why choosing the right investment adviser is crucial for your portfolio's health

    Just as finding a good mechanic will help keep your car running smoothly, finding a good broker or financial advisor can ... Read Full Answer >>
  4. What is the difference between portfolio management and financial planning?

    Utilizing the expertise of a financial professional can be beneficial to an individual wanting to reach an investment goal ... Read Full Answer >>
  5. What advice has Richard Branson given to would-be entrepreneurs?

    Richard Branson, founder of Virgin, is one of the world's most prolific entrepreneurs and has imparted his wisdom to others ... Read Full Answer >>
  6. What advice has Jeff Weiner given to would-be entrepreneurs?

    Jeff Weiner, the billionaire CEO of LinkedIn, is known worldwide as a phenomenally successful entrepreneur and a major influencer ... Read Full Answer >>
Related Articles
  1. Options & Futures

    Shopping For A Financial Advisor

    Finding your perfect advisor is as simple as shopping for a car. Read on to learn more.
  2. Investing Basics

    Paying Your Investment Advisor - Fees Or Commissions?

    The way a professional is compensated can affect quality of service. Learn more here.
  3. Professionals

    A Close Look At Certified Senior Designations

    We examine the validity of senior financial designations and whether they are worth pursuing.
  4. Budgeting

    Dispelling 5 Myths About Financial Planners

    Raise your returns or lower your losses; these often misunderstood specialists can help guide you.
  5. Options & Futures

    Tips For Resolving Disputes With Your Financial Advisor

    Before you blame your advisor for your losses, be sure you know your rights and responsibilities.
  6. Professionals

    How to Prep Your Portfolio for Down Markets

    Down markets are a reality that can kneecap your retirement withdrawal plans. Minimize the pain with these strategies.
  7. Personal Finance

    A Guide to Financial Education for Doctors

    Doctors need to choose the educational option which best fits his or her time, schedule and learning preference. Here's a guide.
  8. Professionals

    Top Retirement Planning Tips for Singles

    Single clients often face an uphill battle when it comes to retirement planning. Here are some tips to get them on the right path.
  9. Professionals

    How Advisors Can Help Clients Spot Elder Scams

    Financial crimes against the elderly are on the upswing. Here's what financial advisors can do to help protect their most vulnerable clients.
  10. Professionals

    Advisors Should Consider a 'Dementia Protocol'

    Diminishing mental capacity can strike any aging client, that's why advisors should push clients and their families to incorporate a 'dementia protocol.'

You May Also Like

Hot Definitions
  1. Fiduciary

    1. A person legally appointed and authorized to hold assets in trust for another person. The fiduciary manages the assets ...
  2. Expected Return

    The amount one would anticipate receiving on an investment that has various known or expected rates of return. For example, ...
  3. Carrying Value

    An accounting measure of value, where the value of an asset or a company is based on the figures in the company's balance ...
  4. Capital Account

    A national account that shows the net change in asset ownership for a nation. The capital account is the net result of public ...
  5. Brand Equity

    The value premium that a company realizes from a product with a recognizable name as compared to its generic equivalent. ...
Trading Center