Broker Compensation for Debt-Based Securities

Posted on April 15, 2009 by Dr. David Edward Marcinko MBA MEd CMP™

Understanding Commission Methods for Selling Investments

By Staff Reporters

steveBrokers earn commissions on debt instruments based on the spread, or markup, between the price at which the broker can secure the bond and the price at which it is sold.

Bond Funds

In the case of bond funds, the fund charges a management fee and/or an expense fee. There may or may not be a load, or commission, paid to a broker.

Assessmentdhimc-book10

For more terminology information, please refer to the Dictionary of Health Economics and Finance.

www.HealthDictionarySeries.com

Conclusion

And so, your thoughts and comments on this Medical Executive-Post are appreciated?

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About Bond Brokers

Posted on November 26, 2008 by Dr. David Edward Marcinko MBA MEd CMP™

Who they are – How they get paid

Staff Writers

According to the Dictionary of Health Economics and Finance, a bond-broker derives her or his income differently than a fee-for-service financial advisor with assets-under-management [AUMs]; not necessarily unlike a stock broker.

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Transaction Driven Commissions

In other words, bond-brokers use transaction-driven sales, and earn commissions based on turnover in a brokerage account or portfolio.

No Quarterly Management Fees

Although the bond-broker takes no quarterly management fees like a financial advisor, the broker’s advice may be colored by the commissions associated with bond issues he or she recommends; which results in an inherent conflict of interest in the broker relationship.

Assessment

Thus, the physician-investor must constantly be aware of the potential for being sold debt-based securities that may be more advantageous to the sales broker than the doctor’s portfolio. Realize too, that the current Credit Default Swap [CDS] fiasco on Wall Street today was prompted in many respects by aggressive bond-brokers! So, always remember Caveat Emptor!

Conclusion

While a bond or stock-broker may offer advice, the physician-investor makes the decisions and therefore is accountable for them. And so, your thoughts and comments on this Executive-Post are appreciated.

Related Information Sources:

Practice Management: http://www.springerpub.com/prod.aspx?prod_id=23759

Physician Financial Planning: http://www.jbpub.com/catalog/0763745790

Medical Risk Management: http://www.jbpub.com/catalog/9780763733421

Healthcare Organizations: www.HealthcareFinancials.com

Health Administration Terms: www.HealthDictionarySeries.com

Physician Advisors: www.CertifiedMedicalPlanner.com

Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com  or Bio: www.stpub.com/pubs/authors/MARCINKO.htm

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