Understanding Shareholders' Use of Information and Advisers (pdf)

FIGURE 13Acceptance of Adviser’s Fund Purchase RecommendationsMedian percent of recommendations followedMean percent of recommendations followed1009080808573656531*8All RespondentsWho Had Consulteda ProfessionalFinancial AdviserFull-serviceBrokerFinancialPlannerBankRepresentativePrimary Financial AdvisorInsuranceAgentNumber ofrespondents =30 1 21 1 180218 5541Small sample size.*Respondents who use a bank representative as their primary financial adviser are statistically different from those using a full- service broker,financial planner, or insurance agent at the 95 percent confidence level.Acceptance of Adviser PurchaseRecommendationsRespondents who had consulted a full-service broker, financialplanner, or insurance agent typically followed their adviser’sfund purchase recommendations. However, respondents whowork with a bank representative rarely followed that individual’sfund purchase suggestions (Figure 13). 5with their professional financial adviser. For respondents whoeffectively delegate all purchase decisions to an adviser, themedian percent of recommendations followed was 100 percent.The median percent for respondents who reach fundpurchase decisions with the assistance of an adviser was 80percent. Not surprisingly, respondents who only tell an adviserwhich funds to buy usually do not accept an adviser’s fundpurchase recommendations (see Figure 44 in Appendix B).Acceptance of an adviser’s fund purchase recommendationsalso varied by the type of relationship that respondents had5Although the sample size for respondents with bank representatives as their primary financial adviser is small, the findings remain noteworthy.16