Moondog
Term

Fiduciary duty

The legal obligation to act in another party's best interest.

A fiduciary must put the client's interest first, above their own. For advisers it underpins the duty of care, the handling of conflicts, and the documentation that demonstrates both.

Understanding who owes a fiduciary duty, and who merely sells, is one of the most protective questions a family can ask. A fiduciary must put the client first and manage conflicts; many in the industry operate to a lower standard. Knowing which you face changes how much to trust the advice.

Related terms

Discretionary mandate An arrangement in which the adviser makes investment decisions within agreed limits. Diversification Spreading capital across assets that don't move together to reduce risk. Efficient frontier The set of portfolios offering the highest expected return for each level of risk. ESG investing Investing that takes environmental, social and governance factors into account. Expected return The return an asset or portfolio is anticipated to earn, on average, over time. Family governance The structures and agreements by which a family makes decisions about shared wealth.

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