Series 63 practice questioneasyDefinition of Investment Adviser — General Definition
In a state-law practice set, a candidate reviews the following scenario. Prioritize the registration trigger and ignore irrelevant noise. Under the Uniform Securities Act, which of the following BEST describes an 'investment adviser'?
- AA bank acting in its regular banking business
- BA person who sells insurance products only
- CA person who, for compensation, engages in the business of advising others about the value of securities✓ Correct answer
- DA broker-dealer whose advice is solely incidental to the conduct of its business
Explanation
Why C — A person who, for compensation, engages in the business of advising others about the value of securities
According to the USA Section 401(c), an investment adviser is any person who, for compensation, engages in the business of advising others about the value of securities or the advisability of investing in securities. This variant keeps the same legal rule but shifts the setup so recall has to stay flexible.
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