A lot comes down to subtle language syntax. For instance, you can say "we target 12% returns," but you can't say "we guarantee 12% returns." You can say "we out-performed the market by over 3% a year for each of the past ten years," but you can't say "we're going to out-perform the market because we have the past ten years." You can say "company X is a great business, and the stock looks cheap here," but you can't say "company X is a can't miss investment and an automatic double at this price."
kennend3|3 years ago
The far larger and more important issue is disclosure laws.
As the other guy posted, you cant recommend one thing and do another.
"we recommend you BUY XYZ" while you are holding a lot of shares in this and sell into the buy market you created.
You also cant offer recommendations without disclosing how you are compensated.
I'm Canadian and more familiar with its rules / regulations but Canadian rules are often best practices used globally.
https://www.iiroc.ca/news-and-publications/notices-and-guida...
Disclosure of financial interest (clause 3608(2)(ii))
A Dealer must disclose whether any person involved in creating the content of a research report has an ownership interest in the subject issuer’s securities. When disclosing ownership interests, a Dealer is not required to include information relating to administrative or clerical staff involved in preparing a research report.
Disclosure of remunerated services (clause 3608(2)(iii)) Clause 3608(2)(iii):
does not require duplicate disclosure from the individuals when the Dealer discloses the services, and excludes normal investment advisory or trade execution services, such as an investment account by the issuer.
Disclosure if making a market (clause 3608(2)(vi))
A Dealer must disclose if it is making a market in an equity or equity related security of the issuer. In addition, a Dealer must make the same disclosure in a fixed income research report if the Dealer is making a market in an equity or equity related security of the issuer.
LeifCarrotson|3 years ago
They're recommending people give their cash to buy a thing (I'm specifically thinking of the "Cash for gold" ads which are constantly playing on the conservative talk radio that our machinists listen to in the shop), while they're doing the opposite: giving away their gold to in exchange for your cash.
Either they're acting against their own self-interest, sacrificing their incorruptible, safe gold for the risky, inflationary fiat currency, or they're lying about what they believe.
pmart123|3 years ago