Firm Grade Distribution
PlainAdvisorCheck assigns each of 27,152 broker-dealer firms a size-normalized A–F grade based on its FINRA BrokerCheck disclosure record. Here is how the industry distributes across grades and exactly how the method works.
Current distribution across 27,152 firms
Most firms earn an A because they carry no reportable disclosures. Grades B–F apply only to firms with at least one disclosure, ranked against same-size peers.
Grades are size-normalized. A firm earns a Grade A when it has no reportable FINRA BrokerCheck disclosures, regardless of how large it is. Firms that do carry disclosures are ranked by disclosure intensity — their weighted disclosure load per branch office — against other firms of a similar size. This matters because larger firms naturally accumulate more disclosures simply by operating more offices; grading on raw counts alone would unfairly penalize scale.
FINRA publishes a branch-office count for every firm but does not publish a firmwide registered-representative headcount, so PlainAdvisorCheck measures firm size by branch footprint — the most reliable size signal available across the whole industry.
The grade is a screening tool, not a definitive judgment. A clean Grade-A firm may simply be small and young; a large firm with a B may carry many absolute disclosures that are modest relative to its enormous footprint. Always review the underlying disclosure details on individual firm pages rather than relying on the letter alone.
Grade Definitions
- Grade A — Clean record. No reportable FINRA BrokerCheck disclosures on file. Earned regardless of firm size.
- Grade B — Low disclosure intensity relative to same-size peers (below the 50th percentile of disclosing firms in its size class).
- Grade C — Typical disclosure intensity for a firm of its size (50th–80th percentile).
- Grade D — Elevated disclosure intensity versus same-size peers (80th–95th percentile). Review the underlying records carefully.
- Grade F — Among the heaviest disclosure records for its size class (top 5%). Warrants deep investigation and caution.
What to Look At Beyond the Grade
Three things matter more than the letter:
- Recency — Is the firm's disclosure pattern old news or ongoing? A clean recent record at a formerly problematic firm signals reform.
- Severity — Regulatory actions resulting in censure or suspension differ from arbitrations settled with no finding. Review the disclosure categories on individual firm pages.
- Pattern — Scattered individual events differ from recurring themes across many branches. Pattern evidence is the stronger predictor of future conduct.
Methodology Limitations
The grade normalizes by branch footprint but not by client count, assets under management, trade volume, or product mix. A discount brokerage executing millions of retail orders generates a different disclosure profile than a high-touch wealth advisor. Interpret grades as a starting point: use them to decide which firms warrant deeper investigation via BrokerCheck, ADV filings, and your state regulator — and which you can set aside with confidence. See the full methodology for the exact weighting.