Is Fidelity a fiduciary?
Fidelity is sometimes a fiduciary and sometimes not. The answer depends on which Fidelity service you use, and which Fidelity entity you signed paperwork with. One Fidelity arm, Fidelity Personal and Workplace Advisors LLC, is a Registered Investment Adviser. It owes a fiduciary duty when it gives advice. The other arm, Fidelity Brokerage Services LLC, is a broker-dealer. It follows the weaker Reg BI rule from the SEC. Many Fidelity clients hold both kinds of accounts at the same time. The same Fidelity rep can act as a fiduciary on Monday and as a broker on Tuesday, based on the account in front of them. Fidelity puts this dual setup in plain English in its Form CRS and Form ADV. The disclosures are honest. They are also easy to miss if you do not read the forms. So the short answer is: it depends on the account, not the brand on the door.
Where Fidelity acts as a fiduciary
Fidelity gives fiduciary advice in some managed-account programs. Examples include:
- Fidelity Wealth Services, the firm's main managed-portfolio program.
- Fidelity Strategic Disciplines, used for clients with bigger balances.
- Fidelity Go, the robo-advisor, which has a fiduciary duty inside its narrow scope.
In each case, the advisory arm is Fidelity Personal and Workplace Advisors LLC. Read its Form ADV Part 2A for the exact terms.
Where Fidelity acts as a broker
Self-directed Fidelity accounts are not under a fiduciary duty. When you call to place a trade, ask about a mutual fund, or talk to a phone rep about your IRA, the rule is Reg BI, not the Advisers Act. Reg BI says Fidelity must pick products that are in your best interest at the time of the call. It does not create an ongoing duty after the call ends.
How to tell which one you have
Read the Form CRS Fidelity gave you when you opened the account. It says, in bold, whether the relationship is brokerage or advisory. If you cannot find your Form CRS, search "Fidelity Form CRS" on adviserinfo.sec.gov. Your account statement and the title at the top of your contract will also tell you. Brokerage accounts say "brokerage." Advisory accounts say "advisory."
Why it matters
The same firm name can give you fiduciary advice in one account and broker advice in another. The duty follows the contract, not the brand. If you want a clean fee-only fiduciary setup with no broker hat in the room, you may want a separate fee-only RIA outside the big custodian brands.