Q:
Michael Feinberg sends a memo to his star investment advisor, Lee Friendly. In the memo Michael includes charts and graphs that illustrate the success of one of the company's proprietary mutual funds. Does this constitute advertising?
a) No, Michael is only sending this communication to one person: an employee.
b) If it were sent over the internet it would be considered advertising.
c) Yes, Michael is advertising to Lee.
d) Yes, it is an in-house ad for a company fund.
A:
The correct answer is a).
Consider the intended target audience when deciding if a communication constitutes advertising. Under the Investment Advisor's Act of 1940, a memo, brochure, email, etc. is considered advertising if it is intended to reach more than one person. Michael's email to Lee is an informative communication intended for one person and, therefore, is not considered advertising.

RELATED FAQS

  1. What are the key differences between marketing and advertising?

    Understanding the role advertising plays in the marketing mix will help business owners define their promotional strategies ...
  2. How important is advertising revenue in the Internet sector?

    Learn about the importance of advertising revenue in the Internet industry. Find out how much Internet firms rely on advertising ...
  3. Can I make money advertising on my car, or is it a scam?

    Are car wrap advertising companies legitimate? Some companies are scams, but some car wrap companies offer legitimate ways ...
  4. Which of the following would be considered “sales literature” under the NASD’s definition ...

    The correct answer is d. Advertising is material created by a broker-dealer for use with the public, where the firm cannot ...
RELATED TERMS
  1. Advertising Appropriation

    The portion of the total marketing budget that is allocated to ...
  2. Flighting

    An advertising scheduling strategy in which a business alternates ...
  3. Advertising Federation Of America - AFA

    A regional advertising group based on the U.S. East Coast that ...
  4. Advertised Price

    The price of a product or service as displayed or announced in ...
  5. Advertising Club Of New York

    The main organization for communications professionals in New ...
  6. Below The Line Advertising

    In general, an advertising strategy in which a product is promoted ...
Hot Definitions
  1. Life Insurance

    A protection against the loss of income that would result if the insured passed away. The named beneficiary receives the ...
  2. Price Elasticity Of Demand

    A measure of the relationship between a change in the quantity demanded of a particular good and a change in its price. Price ...
  3. Market Capitalization

    The total dollar market value of all of a company's outstanding shares. Market capitalization is calculated by multiplying ...
  4. Frexit

    Frexit – short for "French exit" – is a French spinoff of the term Brexit, which emerged when the United Kingdom voted to ...
  5. Stop-Limit Order

    An order placed with a broker that combines the features of stop order with those of a limit order. A stop-limit order will ...
  6. Down Round

    A round of financing where investors purchase stock from a company at a lower valuation than the valuation placed upon the ...
Trading Center