Investing Guide
Mandate, advice or investing on your own: the three forms compared
Discretionary mandate, advisory mandate or execution-only — who decides, which statutory assessments take place and which rights you have in each form. The FIDLEG framework, explained factually.
Last updated on September 23, 2026 · Reviewed by our FINMA-licensed advisory team
In brief
FIDLEG recognises three basic forms of working together when investing. In asset management, the appointed firm decides itself within agreed investment guidelines (FIDLEG Art. 3 Bst. c Ziff. 3). In investment advice, you receive personal recommendations and decide yourself (Ziff. 4). In execution-only, the bank or broker merely executes your orders — without any recommendation and without any statutory assessment (Art. 13).
The statutory ladder of duties hangs on the form: a suitability assessment for asset management and portfolio-based advice (Art. 12), an appropriateness assessment for transaction-based advice (Art. 11), no assessment for mere execution — which must be disclosed. Which form fits a situation depends on time, interest, knowledge and the wish for control — there is no answer that holds for everyone.
This page provides general information. It is neither investment advice nor a recommendation for a particular form of service. As of 2026, without guarantee.
The discretionary mandate: delegated decisions within clear guard rails
In asset management, the client transfers the investment decisions to the appointed firm. The guard rails are set by the contract: investment strategy, guidelines, restrictions. Within them, the firm acts on its own — which is why the law demands the most comprehensive assessment here: before the contract is concluded, the provider must enquire about financial circumstances, investment objectives and knowledge and experience, and assess the suitability of the strategy (FIDLEG Art. 12).
Responsibility for the individual decisions lies with the firm; responsibility for choosing and shaping the strategy remains a joint act at the outset — and should be documented: agreed services and the information collected are part of the statutory duty to document (Art. 15).
The advisory mandate: personal recommendations, your own decision
In investment advice, the decision stays with you: the provider makes personal recommendations — the statutory hallmark of this form (FIDLEG Art. 3 Bst. c Ziff. 4) — and you approve or reject them. The law distinguishes two variants: if your overall portfolio is taken into account, the full suitability assessment applies (Art. 12); if the advice relates only to individual transactions without a view of the portfolio, the leaner appropriateness assessment applies (Art. 11).
Two rights are particularly tangible here: if the provider considers an instrument not appropriate or not suitable, it must advise against it (Art. 14). And every recommendation that leads to a purchase or sale must be documented together with the reasons and your needs (Art. 15 Abs. 2) — you can request that documentation.
Execution-only: investing on your own, without the safety net of an assessment
Where orders are merely executed or transmitted, neither an appropriateness nor a suitability assessment takes place — the provider must inform you before providing the service that these assessments do not apply (FIDLEG Art. 13). No one assesses whether a security fits your knowledge, objectives or circumstances; full responsibility lies with the person investing.
The information rights remain: basic information on the firm, its supervisory status, the ombudsman's office and general risks applies here too (Art. 8 Abs. 1). In the case of mere execution, a key information document only has to be made available if one already exists (Art. 8 Abs. 4).
The ladder of duties at a glance
The more decision-making is delegated, the higher the statutory requirements on the provider:
| Duty | Asset management | Advice (portfolio) | Advice (transaction) | Execution-only |
|---|---|---|---|---|
| Duty to inform (Art. 8) | Yes | Yes, incl. costs of the recommended service | Yes, incl. costs of the recommended service | Basic information |
| Assessment (Art. 10–13) | Suitability | Suitability | Appropriateness | None — with a duty to disclose this |
| Duty to advise against (Art. 14) | Yes | Yes | Yes | No |
| Documentation (Art. 15) | Services and information collected | Additionally the needs and reasons for every recommendation | Additionally the needs and reasons for every recommendation | Services |
What the decision turns on
Whether to delegate, take advice or do it yourself: the weighing-up revolves around four factors — the time and interest to attend to things on an ongoing basis; your own knowledge and experience; the need to take decisions yourself, or precisely not to have to take them; and the costs of the respective form together with the products used. The forms can also be combined — a managed core alongside a self-directed side account, for instance.
There is no answer that holds for everyone; how these factors are weighted is individual. What can be said: switching between the forms is legally possible at any time — what governs is the contractual notice and transfer conditions.
What the forms cost: fee models and cost disclosure in its own guide →
Frequently asked questions
What is the difference between a discretionary and an advisory mandate?
Under a discretionary mandate, the appointed firm decides itself within agreed guidelines; under an advisory mandate, you receive personal recommendations and decide yourself (FIDLEG Art. 3 Bst. c Ziff. 3 and 4) (Source: FIDLEG).
What does the provider assess in a discretionary mandate?
Suitability: financial circumstances, investment objectives and knowledge and experience must be collected before the strategy is agreed (FIDLEG Art. 12) (Source: FIDLEG).
What does the appropriateness assessment mean?
For transaction-based advice without a view of the portfolio, the provider must enquire about knowledge and experience and check whether the instrument is appropriate in that light (FIDLEG Art. 11) — financial circumstances are not collected here (Source: FIDLEG).
Must the adviser advise me against an instrument?
Yes: if the provider considers a financial instrument not appropriate or not suitable, it must advise against it before providing the service (FIDLEG Art. 14) (Source: FIDLEG).
Am I entitled to the documentation of the advice?
The provider must document the agreed services, the information collected and, in the case of advice, the client's needs and the reasons for every recommendation leading to a purchase or sale (FIDLEG Art. 15). On request, account must be rendered (OR Art. 400) (Source: FIDLEG, OR).
Is really nothing assessed under execution-only?
Correct — neither appropriateness nor suitability. The provider must point out before providing the service that these assessments do not apply (FIDLEG Art. 13) (Source: FIDLEG).
Can I combine the forms or switch between them?
Yes. Asset management, advice and direct investing can be run side by side or switched; what governs is the contractual conditions for notice and custody transfer (Source: contract law/market practice).
Sources
- Fedlex — FIDLEG Art. 3, 8, 10–15 (forms of service and the ladder of duties)
- Fedlex — OR Art. 400 (agent's duty to render account and to surrender)
Every deadline and figure on this page has been verified against the official sources linked above. As of the date shown at the top. This page does not replace individual advice.
Advice
Placing the forms of working together in the context of your situation?
Would you like to understand how the three forms differ in structure and total costs? Get in touch with us — we will gladly look at your situation together with you, personally and with no obligation. What you do with it is your decision.