| Whilst a stock market education firm's licence does | | | | In the last survey, only two financial plans out of a |
| not permit them to give investment advice (personal | | | | total of 124 were considered "very good". |
| financial product advice), it is something we are | | | | Sixty-three plans (51 per cent) were graded |
| frequently asked to provide. | | | | "borderline" to "very poor". The report found that |
| HomeTrader provides an alternative to investment | | | | "The advice given often seemed like thinly disguised |
| advice (also known as personal advice). Instead we | | | | product selling." |
| teach you how to develop your own trading system, | | | | John Collett October 6 2004 The Sydney Morning |
| to make your own decisions, with your own money | | | | Herald & The Age |
| and be free of investing advice from others. This is | | | | In addition, the Australian Stock Exchange has |
| called the provision of general advice. | | | | criticised the stockbroking industry for not adopting a |
| What follows is an explanation of personal advice and | | | | tougher approach on the controversial issue of |
| where you can go to obtain it if required. | | | | independent analyst research, citing concerns that |
| A financial adviser is one who provides personal | | | | some share recommendations seemed biased. |
| advice and manages and provides investing advice, | | | | The Australian Financial Review 16/04/05 |
| for a fee. The fee is typically calculated as a | | | | HomeTrader suggests that as part of your research |
| percentage of assets under management annually or | | | | on investment advisers, you investigate all avenues |
| a fee for each individual transaction. | | | | and that you consider getting stock market |
| In Australia, personal advice can only be given by | | | | education to take control of your own future. |
| companies (and their representatives) appropriately | | | | If you do want to take advice from a financial |
| licensed by the Australian Securities & | | | | adviser, we suggest you read the "Getting Advice" |
| Investments Commission (ASIC). | | | | guide provided from ASIC's Financial Tips and Safety |
| Common examples of financial advisers include | | | | Checks ( |
| financial planners and stockbrokers. | | | | Here's our top 7 tips: |
| The vast majority of stockbrokers provide | | | | 1. Deal only with a licensed financial services business |
| investment advice and take orders for the sale and | | | | 2. Pick the adviser with the strongest qualifications, |
| purchase of shares and other financial products. | | | | experience and integrity |
| The most comprehensive study to date has come | | | | 3. Ask questions until you really understand |
| from an ASIC/Australian Consumers Associations | | | | 4. If you feel uneasy, it's OK to walk away |
| (ACA) shadow shop survey of financial planners. The | | | | 5. Make sure your financial plan suits your needs and |
| results of the last national survey, released in early | | | | personality |
| 2003, exposed woeful standards of advice in the | | | | 6. When you get a good plan, stick to it |
| firms surveyed. It followed an earlier joint survey in | | | | 7. |
| 1998 that also reported standards were poor. | | | | |