I understand the need to search for best execution (lowest cost), but say you have one broker executing for 5 bps and offering nothing but execution, and another trading for 10bps, but they offer this one report that you think will make your clients a ton of money, are you allowed to trade with the second broker at 10 bps to get this report, or do they also have to offer execution at 5 bps.?
Yes, I believe you can trade with the 10bps broker, as long as the value to the client is worth the extra 5bps through the research report.
you cannot base it on what makes clients lots of money. lol obviously there will be subjectivety in your choice but if the more expensive one brings back essential research which you feel offers best execution and service to the client, then thats is good. Your disclosure duties and clients right for client-directed brokerage protects you in this decision.