Investor Glossary-trust companyInvestor Glossary-trust companyInvestor Glossary-trust companyInvestor Glossary-trust companyInsightful stock market charts - Click here
investor
Categories    # A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

Trust Company

The HTML to link to this page
 

A trust company is a firm, usually associated with a bank or law firm, that manages investments, administers trusts, and settles estates. In these roles a trust company may either act as an agent, trustee, or executor depending on the type of account relationship. One thing that distinguishes a trust company from a brokerage firm is that a trust company assumes a fiduciary responsibility for a trustee, grantor, or decedent's estate.

Because a trust company acts as a fiduciary on behalf of clients they are held to a higher regulatory standard than brokerage or other investment firms. A trust company falls under the jurisdiction of state or federal banking regulators depending on whether or not it is a state-chartered or federally-chartered trust company.

Services offered by a trust company may range from investment management to tax consulting to paying bills or handling the settling of an estate with the courts. Not every trust company offers this full range of services, however. Some specialize in a specific type of account or service. A trust company may also offer common trust funds, an investment vehicle similar to a mutual fund, which allows the commingling of investment funds for the purposes of pooled investment. Common trust funds are only available to trust accounts.

Some reasons why an investor might choose a trust company over a traditional brokerage firm are access to common trust funds, expertise in regards to the administration of estates and trusts, and the expedited and more private settling of an estate that a trust allows.



Rate this trust company definition...

Learn about investing with the Investor Glossary Term of the Day


Click here for insightful stock market charts. Where is the market headed? The answer may surprise you. Find out
with the exclusive & Barron's recommended charts of Chart of the Day.


Popular Terms: Key Rate Duration, EBITDA, phantom income, debt service coverage, inflation, liquidity ratio, wholly-owned subsidiary, limit order, Zero Cost Collar, FTSE, LIBOR, required rate of return, covered put, 401a, class C shares, diluted share, annual return, APR, stock market close, VIX, current ratio, labor relations, 144a, ex-dividend date, 1035 exchange, cancelled check, per diem, implied volatility, real GDP, minority interest, margin rate, command economy, ex-dividend, quality assurance, irrevocable trust, risk management, in escrow, reverse mortgage, retained earnings, deferred tax, dividends payable, average price per share, option premium, balance sheet, open position, 1031 exchange, stock split, FICO score, deferred revenue


Accounting | Banking | Bonds | Brokers | Economy | Futures | Mutual Funds | Options | Real Estate | Retirement | Stocks | Taxes | Technical Analysis
Home | Term of the Day | Suggest a Term | Chart of the Day | Dogs of the Dow
©2004-2015 Investor Glossary - All rights reserved - Terms of Use