What is the difference between a broker-dealer and a registered investment adviser?

The difference between a broker-dealer and a registered investment adviser is that they are two distinct types of professional entities in the financial services industry. A broker-dealer is a firm that trades securities for its own account and also facilitates trading and provides advice on securities transactions for clients. It is regulated by the Securities and Exchange Commission (SEC) and some of the most common broker-dealers are banks, brokerages, and investment firms. A registered investment adviser is a professional who provides investment advice for compensation and is registered with the SEC or a state regulator. Investment advisers must adhere to a certain code of ethics and must provide full disclosure to their clients about the conflicts of interest they may have. Advisers must register with their home state and provide information on investments they make and fees they charge. Registered investment advisers may provide advice on a range of financial topics, such as investments, taxes, retirement planning, and estate planning. Broker-dealers, on the other hand, focus more on trading in securities and other investments and may not offer financial advice. In Florida, both broker-dealers and registered investment advisers must register with the state securities division in order to provide services to clients. They must also abide by the rules and regulations set forth by the state in order to protect investors from fraud.

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What is the difference between a broker-dealer and a registered investment adviser?

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