What is the difference between a registered representative and an investment adviser?

The primary difference between a registered representative and an investment adviser is their level of expertise and their relationship with investors. A registered representative is an individual who is registered with the Financial Industry Regulatory Authority (FINRA) and who works with clients to sell or execute transactions in securities. They must pass exams and are not required to have any specific level of education nor do they need to provide a particular type of advice. A registered representative is generally compensated through commissions when executing a transaction, and their actions are regulated by FINRA. An investment adviser, on the other hand, is an individual or firm that is registered with the California Department of Business Oversight, whose primary purpose is providing advice and managing portfolios for their clients. A more formal education and more sophisticated understanding of the securities industry is often required for individuals in this role. Investment advisers can provide a range of services including making buy and sell decisions for clients, providing advice about investments, and providing ongoing portfolio management. Investment advisers are compensated by either an hourly rate or a percentage of the amount managed and their activities are regulated by the state. In California, it is important to understand the difference between a registered representative and an investment adviser when considering investments. Regulations are in place to help protect investors from fraud and ensure they receive unbiased advice and make sound investment decisions.

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What is the difference between a registered representative and an investment adviser?

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