Series 63 practice questioneasyDefinition of Investment Adviser and Requirement to Register
Under the Uniform Securities Act, which of the following is generally required to register as an investment adviser at the state level?
- AA publisher of a bona fide financial newspaper
- BA bank offering investment advice as part of its normal banking activities
- CA firm that provides investment advice to clients for compensation✓ Correct answer
- DA lawyer who gives incidental investment advice to clients
Explanation
Why C — A firm that provides investment advice to clients for compensation
Under the USA, any firm or individual who, for compensation, engages in the business of advising others about securities generally must register as an investment adviser, unless an exemption applies. Banks, bona fide publishers, and professionals offering incidental advice are excluded from the definition (USA Section 401(c)).
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