What it is
A fiduciary is a person or an organization that acts on behalf of another person or organization to do certain things while preserving good faith and trust. The fiduciary’s duty is to put the client’s interests ahead of its own, and so it has a legal and ethical responsibility to do so.
In finance, an investment fiduciary is someone who has the legal responsibility to manage another person’s money.
The person or organization that enters into a relationship with a fiduciary can be referred to as the beneficiary or principal, depending on the nature of the relationship.
What it means for you
When you make an investment through a bank or investment company, that entity will have a fiduciary duty towards you.
That’s why trust is such a big factor when it comes to money, because you will have to believe in the entity’s willingness and capability to fulfill its responsibility to you before entering any sort of relationship with it.