What is the AFI Score?
The AFI Score is a proprietary composite index developed by AdvisorForInvestors to provide investors with an objective, data-driven assessment of every SEC-registered Registered Investment Advisor in the United States. Every firm receives a numerical score from 0 to 100, calculated by applying a standardized quantitative methodology to publicly available data from SEC Form ADV filings and FINRA BrokerCheck records.
The score then determines which rating tier a firm falls into. Firms scoring 90 to 100 receive a Highly Recommended designation. Firms scoring 60 to 89 receive a Recommended designation. Firms scoring 0 to 59 receive a Not Recommended designation. There is no partial credit and we do not grade on a curve.
How the Score is Calculated
The AFI Score is calculated across five independently weighted criteria. Fee structure carries the most weight at 30 points and evaluates whether the firm operates as fee-only, fee-based, or commission-based. Disciplinary history carries 25 points and reflects the firm's regulatory record as disclosed in SEC Form ADV and FINRA BrokerCheck. Transparency carries 20 points and assesses the completeness of the firm's Form ADV Part 2 disclosures. Years in continuous SEC registration carries 15 points. Client accessibility carries 10 points and evaluates whether the firm is genuinely accessible to everyday investors or exclusively serves institutional clients.
A Highly Recommended firm must score 90 or above AND pass our manual review. This means being genuinely fee-only with zero disciplinary disclosures, filing complete and current ADV disclosures, operating for over 15 years, serving a broad client base including everyday investors, and having no affiliated entity relationships of any kind. Fewer than 10 firms in the entire country hold this designation at any given time.
Why These Criteria Matter
Fee structure is the single most important factor in assessing an advisor's alignment with their clients. A fee-only advisor earns no commissions and has no financial incentive to recommend products that benefit them rather than their clients. A commission-based advisor, by contrast, may have significant financial incentives that conflict with their clients' best interests even when fulfilling their fiduciary duty to disclose those conflicts.
Disciplinary history is equally critical. Regulatory actions, enforcement proceedings, and material disclosures on Form ADV signal past conduct that investors deserve to know about before entrusting someone with their financial future.
How Often Scores are Updated
AFI Scores are recalculated on a monthly cycle following the availability of updated regulatory filings from the SEC. If a firm changes its fee structure, receives a new disciplinary disclosure, or updates its Form ADV in any material way, that change will be reflected in the firm's AFI Score at the next monthly recalculation.
Because public regulatory data can sometimes contain processing delays, we encourage investors to independently verify any information that is material to their decision through the SEC's IAPD database at adviserinfo.sec.gov and FINRA BrokerCheck at brokercheck.finra.org.
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