Asset-Based Fees Are Not Intrinsically Better
They exist because of customer demand, not moral superiority.
The rationale: Fisher charges an asset-based fee, so that if its customers’ portfolios increase in value, it collects more revenue. That math works both ways, so if those portfolios lose money, then Fisher’s revenues will shrink. Clearly, Fisher executives expect that investors will be attracted to that proposition, as it is one of four company attributes mentioned by the ad (the other three being that Fisher customizes its advice, doesn’t accept sales commissions, and is a fiduciary).