Q:

According to SEC Release IA-1092, which of the following would NOT qualify as an investment advisor?
A) A sports representative who manages Derek Jeter's financial dealings.
B) A financial planner who illustrates the correct asset balance for an investment portfolio.
C) A CPA who advises his client on tax law as it regards estate planning strategies.
D) A pension consultant managing $25 million.

A:
The correct answer is C).
SEC Release IA-1092 considers financial planners, pension consultants and sports and entertainment representatives as investment advisors. A CPA who provides advice that is solely incidental to the practice of his profession is exempt from the definition.

RELATED FAQS

  1. Is an index fund better than having to hire a financial advisor?

    <p>I would like to know if I put my money into an index fund, preferably the S&amp;P 500 Index fund, would that be better ...
  2. Do financial advisors work only in banks?

    Learn how financial advisors are employed not only by various financial institutions, such as banks, but an increasing number ...
  3. What are the reasons that cause financial advisors to fail in their careers?

    Think about the risks with financial planning before you pursue a career in the industry, and make sure you aren't wasting ...
  4. How quickly should my financial advisor sell a stock that I have asked him or her ...

    Financial advisors and planners have fiduciary responsibilities to their investors. They owe their investors a high degree ...
  5. Your firm is a registered investment advisor that specializes in investment management ...

    The correct answer is b: As a professional, you must be able to recognize when clients make requests for services that are ...
  6. Where can I look for a financial planner?

    References from trusted friends or family members can help you find a financial planner; however, keep in mind that your ...
RELATED TERMS
  1. SEC Release IA-1092

    A release from the Securities &amp; Exchange Commission (SEC) ...
  2. Investment Advisor

    As defined by the Investment Advisors Act of 1940, any person ...
  3. Financial Planner

    A qualified investment professional who helps individuals and ...
  4. Registered Investment Advisor - RIA

    An advisor or firm engaged in the investment advisory business ...
  5. Federal Covered Advisor

    An investment advisor in the United States that manages more ...
  6. Investment Consultant

    An advisor who helps investors with their long-term investment ...
Hot Definitions
  1. AAA

    The highest possible rating assigned to the bonds of an issuer by credit rating agencies. An issuer that is rated AAA has ...
  2. GBP

    The abbreviation for the British pound sterling, the official currency of the United Kingdom, the British Overseas Territories ...
  3. Diversification

    A risk management technique that mixes a wide variety of investments within a portfolio. The rationale behind this technique ...
  4. European Union - EU

    A group of European countries that participates in the world economy as one economic unit and operates under one official ...
  5. Sell-Off

    The rapid selling of securities, such as stocks, bonds and commodities. The increase in supply leads to a decline in the ...
  6. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
Trading Center