Series 63 practice questioneasyBroker-Dealer Exclusion
A registered broker-dealer provides investment advice as an incidental part of its business and receives no special compensation. Under the USA, the broker-dealer is:
- AAn investment adviser and must register
- BExcluded from the definition of investment adviser✓ Correct answer
- CAn investment adviser representative
- DRequired to register as a federal covered adviser
Explanation
Why B — Excluded from the definition of investment adviser
Broker-dealers are excluded from the IA definition when advice is incidental and no special compensation is received (Section 401(c)).
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