Limited Power Of Attorney - LPOA

AAA

DEFINITION of 'Limited Power Of Attorney - LPOA'

An authorization form used in the professional money management field which gives a portfolio manager discretion to perform certain functions in a client's account, such as:

- trading authorization,
- disbursement authority,
- fee-payment authority and
- have forms sent straight to broker, such as proxy statements, tender offers, etc.

The "limited" in LPOA refers to the fact that certain critical account functions are still only available to the account holder, such as cash withdrawals, a change of beneficiary or other major account actions.

INVESTOPEDIA EXPLAINS 'Limited Power Of Attorney - LPOA'

LPOA authorizations have grown rapidly in the past decade as many investors move their accounts from standard brokerage firms to boutique money management firms (such as RIAs). LPOAs allow the manager to execute their investment strategy for the client without constantly having to contact the client to approve the order prior to execution.

RELATED TERMS
  1. Limited Discretionary Account

    A type of account in which a client allows a broker to act on ...
  2. Trading Authorization

    The level of power entrusted to a broker or agent granting specific ...
  3. Managed Account

    An investment account that is owned by an individual investor ...
  4. Full-Service Broker

    A broker that provides a large variety of services to its clients, ...
  5. Broker

    1. An individual or firm that charges a fee or commission for ...
  6. Discretionary Account

    An account that allows a broker to buy and sell securities without ...
RELATED FAQS
  1. If a trust is named as the beneficiary of an IRA, can the trustee of that trust become ...

    While the IRA owner is alive, only the IRA owner can change the designated beneficiary of the IRA. Exceptions may apply ... Read Full Answer >>
  2. What are the biggest risks associated with covered interest arbitrage?

    Covered interest arbitrage is when an investor buys into foreign currency that has an interest rate that will yield the investor ... Read Full Answer >>
  3. Why are the tangible assets of a company important to investors?

    A financial forecast is an estimation or projection of likely future income or revenue and expenses, while a financial plan ... Read Full Answer >>
  4. How does price elasticity affect my stock purchase decisions?

    The person who handles a corporation's short-term investments varies depending on the size of the company, the corporate ... Read Full Answer >>
  5. Which financial instruments have par values?

    Short-term investments can include a number of possible investment vehicles. Marketable equity securities are just one of ... Read Full Answer >>
  6. What are some examples of fiduciary duty?

    Under the U.S. legal system, a fiduciary duty is the legal term describing the relationship between two parties that obligates ... Read Full Answer >>
Related Articles
  1. Brokers

    Evaluating Your Stock Broker

    Make sure you're getting the best service by staying informed and involved.
  2. Options & Futures

    Three Documents You Shouldn't Do Without

    Estate planning is not just about the division of assets after you die. Read on to save your loved ones extra grief.
  3. Options & Futures

    Your Will: Why You Need A Power Of Attorney And Beneficiaries

    What would happen if you were suddenly unable to manage your financial affairs? Preparation is the best protection.
  4. Retirement

    The Top 3 Retiree Worries (And What To Do About Them)

    Discover the most common problems retirees face, and what they can do to solve them.
  5. Entrepreneurship

    Employment Negotiations: What To Ask For & How

    Improving their first offer: What you should know
  6. Entrepreneurship

    How To Talk To Headhunters

    8 tips on forging a fruitful relationship with an executive recruiter.
  7. Investing

    Should Amtrak Be Privatized?

    This story examines whether or not Amtrak, the US consumer rail system, should be privatized in the wake of its tragic accident.
  8. Personal Finance

    The Purpose Of a FMLA Form

    Parsing the different types of paperwork that accompany a leave of absence under the Family Medical Leave Act.
  9. Professionals

    Fund Boards: What They Do and Why You Should Care

    Fund boards oversee management and operations of the fund on behalf of shareholders. Make sure you've got a board that will look out for you.
  10. Personal Finance

    8 Ways To Seriously Blow It With A Headhunter

    Job hunters, beware. These are the 8 things that blow your chances with headhunters. So pay attention to your behavior when you're being interviewed.

You May Also Like

Hot Definitions
  1. Bund

    A bond issued by Germany's federal government, or the German word for "bond." Bunds are the German equivalent of U.S. Treasury ...
  2. European Central Bank - ECB

    The central bank responsible for the monetary system of the European Union (EU) and the euro currency. The bank was formed ...
  3. Quantitative Easing

    An unconventional monetary policy in which a central bank purchases private sector financial assets in order to lower interest ...
  4. Current Account Deficit

    A measurement of a country’s trade in which the value of goods and services it imports exceeds the value of goods and services ...
  5. International Monetary Fund - IMF

    An international organization created for the purpose of: 1. Promoting global monetary and exchange stability. 2. Facilitating ...
  6. Risk-Return Tradeoff

    The principle that potential return rises with an increase in risk. Low levels of uncertainty (low-risk) are associated with ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!