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How Paladin Research Rates Financial Advisors

Paladin Advisor Research (www.PaladinRegistry.com) rates the quality of financial advisors who are Registered Investment Advisors or Investment Advisor Representatives. Paladin also rates the quality of stockbrokers or insurance agents who sell financial products for commissions.

Paladin’s proprietary rating algorithm is based on the principles in a book that was authored by Jack Waymire, Paladin’s founder: Who’s Watching Your Money? The 17 Paladin Principles for Selecting a Financial Advisor. The algorithm in the book focused on four categories of advisor information: Credentials, Ethics, Business Practices, and Financial Services.

Credentials

The most important financial advisor credential is years of experience. Planning and investment advisory experience is more important than selling experience. Next, are certifications that represent sources of specialized financial knowledge. The best credentials are CFA®, CIMA®, CFP®, and CPA®. Paladin developed a Check a Credential service that investors use to determine the quality of advisor credentials – 35% are fake or discontinued. Third is education, in particular degrees with majors that increase the financial knowledge of advisors.  […]

Financial Advisor Quality Ratings Are Here!

You have been able to view the ratings of restaurants, hotels, vacation destinations, and mutual funds for decades. The source of the rating gathers the data, applies a rating algorithm, and publishes a report. Ratings also include a report that documents the facts about the product or service. You use the rating and report to make your selection decision. 

What About Financial Advisors?

One of the most important financial decisions you will ever make is the selection of a financial advisor. However, until now, you have been on your own to develop your own data-gathering tool and a rating system that compares advisors to each other. However, very few investors are going to take the time to produce their own processes. Financial advisors are more than willing to fill the vacuum with sales pitches, undocumented sales claims, and marketing materials.

What About Public Data for Financial Advisors?

Unlike other types of products or service-providers there is a limited amount of public data for financial advisors. In the past, your only reliable source was FINRA, the regulatory agency for broker/dealers and their representatives. FINRA focuses on advisor compliance records. Best case, this is about 25% of the information you need to evaluate and select financial advisors. It is up to you to obtain the other 75%. […]

What Does it Mean to be a 5 Star Rated Financial Advisor in the Paladin Registry?

Financial advisors could have track records, but 99% do not. Why should they produce track records if they don’t have to? Investors are willing to turn over their assets without any idea if advisors are capable of producing competitive performance for reasonable risk and expense.

Investors would be better off if they could review legitimate, audited track records that accurately reflected the past performance of financial advisors, but that is not going to happen. Investors need an alternative process for determining the quality of financial advisors.

Paladin Research

Because there are no track records Paladin developed an alternative process for determining the quality of financial advisors. This process is called due diligence. Paladin had to look at key advisor characteristics that impacted their competence and trustworthiness.

Advisor Credentials

The first research category is four financial advisor credentials that impact their knowledge: Education (college degrees), years of experience, certifications (CFA®, CFP®, CIMA®), and memberships in associations that have continuing education requirements and codes of ethics.  […]

Jack Waymire Helps Investors Protect Themselves

Jack Waymire spent 28 years in the financial services industry. For 21 of those years as the president of a Registered Investment Advisory firm that licensed hundreds of financial advisors and provided services to 50,000 investors. This role gave him a bird’s eye view of how industry professionals sold and serviced financial services and products.

Then the stock market crashed in 2000-2002 due to another Wall Street manufactured bubble (dotcoms, telecommunications) that burst when $300 stocks, that had no earnings, dropped to ten cents a share. Waymire watched several of his friends lose half of their assets due to bad, tainted, and fraudulent financial advice.

As a result of this experience Jack decided to write a book that would help investors select high quality financial advisors and avoid advisors who masqueraded as financial experts. His book, Who’s Watching Your Money? The 17 Paladin Principles for Selecting a Financial Advisor, was published by John Wiley & Sons in December 2003. Waymire decided to leave the financial services industry a few months later to promote his book and build a website that was based on the Principles in his book.  […]

The Best Way to Find a Financial Advisor

Financial advisors use a number of marketing strategies to meet investors. At the same time, investors use a number of strategies to find a financial advisor. Most of these methods are fraught with hidden risks. So what is the best way to find a competent, ethical financial advisor?

Financial Advisors Find You 

Most financial advisors are sales representatives or they have sales skills that include prospecting for new clients, telephone techniques, sales pitches, and closing. They have a number of prospecting strategies that include direct mail, free seminars, networking with other professionals and asking current clients for referrals. Needless to say, financial advisors who find you are a risky alternative because their primary skills may be sales versus planning and investing. […]