Articles on Stock markets

A form ADV can be requested to find out all about the fees and professional backgrounds of a financial advisory firm.

Firms who engage in the solicitation of securities or give investment advice must file form ADV with the SEC and keep it updated, usually on an annual basis.

It is similar to the form U4 that individual securities-licensed professionals must submit and keep updated in the event of changes of address, tax liens, industry disciplinary actions, and so forth, but the ADV is filed on behalf of a firm instead of an individual. FINRA and the NASAA keep up with the filings as well.

Failure of the firm to update the document as required is a violation of Rule 204-1. Registered Investment Advisors (RIAs) with Assets Under Management (AUM) of $25 Million or more must update the form on a quarterly basis.

The form details the professional backgrounds and any disciplinary actions of the employees of the firm, as well as the asset allocation of their assets under management and all of the fees and commissions that their firm charges. It is essentially a full disclosure of pertinent information for consumers as well as regulators.

Anyone can request an updated ADV on a specific broker or advisor from the SEC before making a decision to do business with the firm.

What is a Federally Covered Advisor?
Is there a Benefit to Self-Managing?