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

The main difference between a registered representative and an investment adviser lies in the type of advice they provide and their legal obligations. A registered representative is a broker or salesperson who acts as an intermediary between buyers and sellers. Their responsibility is to facilitate the sale of securities such as stocks and bonds. They provide their clients with advice on which investments to make, but it is usually limited to the products they represent. On the other hand, an investment adviser is a professional who provides financial advice and typically has a fiduciary duty to act in their client’s best interest. While registered representatives must be subject to certain investment fraud laws and overseen by the Financial Industry Regulatory Authority (FINRA), investment advisers must be registered with the Securities and Exchange Commission (SEC). The regulatory environment for investment advisers is much more stringent than that for registered representatives. They are obligated to provide complete disclosure regarding fees and risks associated with a particular investment and must disclose material facts that their clients need to know before making a decision. Also, investment advisers must comply with fiduciary standards and their advice must always be in the best interests of their clients.

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

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