Broker fiduciary responsibility and "prudent Man rule" on investing.
· Apirl 14th 2012
Broker fiduciary responsibility and "prudent Man rule" on investing.
The brokers here are completely out of control vs. the retail investors by indirectly advocating trading galore. Most of the broker research is geared towards trading and insitutional investing. What about the 99% others? The number of retail investors has not growth at all and the situation has only gotten worse over the years. There now is some hope, becaue at last the Thai SEC has shaken things up.
Thai brokers seem to have no concept of fiduciary responsibility or the "prudent Man rule", on investing. Most all novices which dare to show up get induced into trading and when some dare to ask "how about a few good stocks", these answer "nobody invests like that around here". Saddly so it has only gotten worse over the years. I seem to be the only knowledgeable investor here which cares to say anything.
Yes, at last it seems like the SEC is finally putting its foot down and will mandate for these to a least provide 1/4 of their equity research on smaller and mid cap stocks. If that happens as I think is way overdue, there will be a revaluation of smaller cap's.!
Imaging a situation where you want to advocate value investing to responsible individuals, only to see those stocks often just don't move. You so have a "Catch 22’situation for many years: you can responsibly accumulate high dividend, high growth stocks at discount valuation, but then risk to be stuck with underperformance; or you can join the trading/institutional crowd and chase large cap. volatile stocks and so keep up, at least for a while. In doing so you pay dearly for high p/e's & low dividend yields besides lower long term average growth rates, all just so to own huge liquid stocks: a feature which means very to rational smaller retail investor.
Best Regards, Seasons' Greetings and Happy, Healthy and Prosperous Thai Happy New Year 2012 to all members and readers of Thaistocks.com!
Paul A. Renaud.
