Soft dollar standards-rama direct, another, explained, situation, benefit

sabaruch

Is there ever a situation where I, the client, can direct my brokerage to the benefit of another client? Is this ever explained? Thanks.

ayaz_mahmud369

I doubt this topic will come up. But just know that brokerage directed from the client can be used for donating to charity, etc..

comp_sci_kid

Using brokerage from another client is sort of like stealing their soft dollars. I think the actual client can do whatever they want with their own soft dollars. The client could donate all their brokerage to a charity, now it would be a violation if you used somebody else brokerage to pay for research used later by that client just because he gave all of his away.



This is how i have it understood, not my greatest area here.



Edited 1 time(s). Last edit at Wednesday, June 2, 2010 at 12:14AM by justinkc.

firat

I believe you can, not sure why you would. You have to make sure it is the client and not the trustees for a fund, trustees are not the client. I remember an example where the client asked that her soft dollar brokerage be donated to a charity, which was acceptable. But fund trustees wanted to do something similar which is not allowed because there not the real client

hope that helps

RepoToronto

Although what justinkc says makes complete sense, I think Soft Dollar Standard V. in Reading 3 (Client-directed Brokerage) states the opposite. Under the 'Required:' heading it states: "Do not use brokerage from another client to pay for products and services purchased under any client-directed brokerage agreement". Please correct me if I'm mistaken.



Edited 1 time(s). Last edit at Tuesday, June 1, 2010 at 11:53PM by shoebkhan.