Series 63 practice questionmediumDefinition of Investment Adviser — Exclusions
On a timed state-securities quiz, the scenario below appears. Treat the facts as a straight Series 63 application question. Which of the following persons would NOT be considered an investment adviser under the Uniform Securities Act (USA)?
- AA partnership that manages the investments of others and charges a fee
- BA person providing advice on the value of securities for compensation as a regular business
- CA publisher who gives specific buy and sell recommendations in a paid newsletter
- DA bank providing investment advice as part of trust services✓ Correct answer
Explanation
Why D — A bank providing investment advice as part of trust services
Under the USA, banks are excluded from the definition of investment adviser (Section 401(c)). Publishers giving specific recommendations may be advisers unless their publication is general and regular, and persons giving advice for compensation are generally considered advisers. The governing USA principle is unchanged even though the framing is different.
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