Series 63 practice questioneasyDefinition of Investment Adviser — Compensation Element
During a compliance drill, focus on how the Uniform Securities Act applies here. Treat the facts as a straight Series 63 application question. According to the Uniform Securities Act, which of the following is a required element for a person to be considered an investment adviser?
- AThey must manage at least $100 million in assets
- BThey must be registered with the SEC
- CThey must be a licensed broker-dealer
- DThey must receive compensation for their advice✓ Correct answer
Explanation
Why D — They must receive compensation for their advice
The USA requires that, to be considered an investment adviser, a person must provide advice regarding securities for compensation (USA Section 401(c)). This variant keeps the same legal rule but shifts the setup so recall has to stay flexible.
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