Series 63 practice questioneasyFederal covered adviser vs state registration
A new investment adviser in State Y reports $120 million in AUM. Under the Uniform Securities Act, the adviser must:
- ARegister only with the SEC as a federal covered adviser✓ Correct answer
- BRegister only with State Y
- CRegister with both the SEC and State Y
- DRegister with neither the SEC nor State Y
Explanation
Why A — Register only with the SEC as a federal covered adviser
Advisers with $110 million or more in AUM must register with the SEC as federal covered advisers and are preempted from state registration. Advisers with less than $100 million AUM register with the state. Advisers with AUM between $100 million and $110 million may choose state or SEC registration.
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