Glossary · Compliance and regulation
Basis for recommendation
The basis for a recommendation is the documented reasoning showing why a particular recommendation was in the client's best interest, including the alternatives that were considered and not chosen.
Most proposals document what is being recommended — allocation, projections, holdings — and not why. The alternatives-considered statement, including at least one lower-cost or simpler option with the reason it was not chosen, is the part that defends the recommendation later.
A recommendation that never considered a cheaper alternative is indistinguishable, on paper, from one that never looked.
Read more: The alternative you didn't choose →
Questions this did not answer? Ask them directly — that is what the twenty minutes is for.