What is a broker/dealer? Types
A broker/dealer is an intermediary in which investors purchase financial assets such as stocks, bonds, and mutual funds, as well as services such as financial planning, retirement, etc. Different types included “wirehouses,” which were the biggest firms that did business on a national, and often global, basis. There were also independent brokers who weren’t members of the NYSE. Lastly there were “regional” broker/dealers who had the same product scope as wirehouses but were based solely outside of New York. What “channels’ does Raymond James use to serve individual investors?
Raymond James currently has two channels. One was a network of employee financial advisors. The additional channel was a network of independent financial advisors who had access to Raymond James’ product and services, research, back office operations, and brand name through an independent contractor relationship. What is “front” money?
“Front money was in retrospect a signing bonus offered to prospective hires. The front money consisted of a certain percentage of that hire’s previous year’s payout. This was used in order to draw that particular person away from a competitor. It was rare for a person to get “front money” when going independent. What is the “Quasi” model? Its benefits? Should be used or not?
The “Quasi” model was a channel that was placed somewhere between the employee model and the independent model currently in use. Advisors in the Quasi would still be employees of Raymond James, but would maintain a significant degree of operating and financial independence. This came with all the upsides and downsides of independence. Check Helk believed it would be beneficial to employees who wanted some independence but feared going out completely on their own. The employee would make all the key decisions in respect to their business, but the firm would provide the service. While this looks like a really good idea on paper,...
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