What to expect from due diligence on and by an investment adviser

WE often ask around if we need advice. We talk to our colleagues. We call on friends, and sometimes family members. They may be able to offer insights to whatever we want to know. The prudent among them would qualify their opinion with disclaimers such as "I have never used their maid services before". Or, "They were well-known back then for prompt service, but things might have changed with the new owners.'' And, "Best you do your own checks before committing to the renovator.''

As a recipient of good-faith advice, we should conduct our own due diligence.

What then is the difference if we were to engage a professional to advise us? We should still do our checks and due diligence. But we do expect professionals who dispense advice to exercise diligence themselves, and have a reasonable and adequate basis for recommending a course of action.