A Federal Covered Investment Advisor is defined by which condition?

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Multiple Choice

A Federal Covered Investment Advisor is defined by which condition?

Explanation:
A Federal Covered Investment Adviser is defined by meeting a minimum threshold of assets under management, which triggers SEC registration and federal oversight. When an adviser manages about $110 million or more, they register with the Securities and Exchange Commission rather than with state regulators, making them a federal covered adviser. This status isn’t about being a broker-dealer or about the adviser only handling government securities; those factors don’t establish federal coverage. So, the defining condition is reaching the $110 million AUM threshold.

A Federal Covered Investment Adviser is defined by meeting a minimum threshold of assets under management, which triggers SEC registration and federal oversight. When an adviser manages about $110 million or more, they register with the Securities and Exchange Commission rather than with state regulators, making them a federal covered adviser. This status isn’t about being a broker-dealer or about the adviser only handling government securities; those factors don’t establish federal coverage. So, the defining condition is reaching the $110 million AUM threshold.

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