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. How are debit notes to help collect on a debt?

    Learn what a debit note is and how it's associated with a debit memo request. Understand how a debit note works to help a ...
  4. 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 ...
  5. 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 Elasticity Of Demand - AED

    A measure of a market's sensitivity to increases or decreases ...
  4. Advertising Association Of The West - AAW

    A regional advertising group based on the American West Coast ...
  5. Advertising Budget

    An estimation of a company's promotional expenditures over a ...
  6. Comparative Advertising

    A marketing strategy in which a company shows how its product ...
Hot Definitions
  1. Death Taxes

    Taxes imposed by the federal and/or state government on someone's estate upon their death. These taxes are levied on the ...
  2. Retained Earnings

    Retained earnings is the percentage of net earnings not paid out as dividends, but retained by the company to be reinvested ...
  3. Demand Elasticity

    In economics, the demand elasticity refers to how sensitive the demand for a good is to changes in other economic variables. ...
  4. Dark Pool

    A dark pool is a private financial forum or exchange for trading securities.
  5. Quadruple Witching

    The expiration date of various stock index futures, stock index options, stock options and single stock futures. All stock ...
  6. American Opportunity Tax Credit

    A tax credit that enabled more student and parents to pay for part of their college expenses in the 2009 and 2010 tax years ...
Trading Center