What is a Registered Investment Advisor (RIA)?
How Does a Registered Investment Advisor (RIA) Work?
An investment manager who is an RIA has not necessarily completed a level of education that qualifies him or her to provide a higher level of service. The RIA designation simply means that an investment manager is registered with the SEC and must comply with specific regulations regarding any action taken on the assets he or she manages. Registration with the SEC is compulsory once someone is managing in excess of a certain amount in assets ($25 million and above). And annually, they must register with their local state authorities as well as disclose to the SEC their standing with regard to the assets they manage.
To illustrate, suppose Bob is an investment manager who is a RIA. This does not certify him as an effective advisor; however it should reassure his clients that he must comply with SEC regulations and should, therefore, hold higher ethical and professional standards.
Why Does a Registered Investment Advisor (RIA) Matter?
The RIA, though not a designation, forces those who manage several million dollars in others' assets to comply lawfully with SEC regulations. This protects an RIA's clients and gives them peace of mind knowing that the individual managing their assets must be SEC-compliant.
Personalized Financial Plans for an Uncertain Market
In today’s uncertain market, investors are looking for answers to help them grow and protect their savings. So we partnered with Vanguard Advisers -- one of the most trusted names in finance -- to offer you a financial plan built to withstand a variety of market and economic conditions. A Vanguard advisor will craft your customized plan and then manage your savings, giving you more confidence to help you meet your goals. Click here to get started.
Read This Next
As an investor who loves to buy, hold and collect returns from my investments, I usually hate the idea of having to sell one of the stocks...Read More →
Did your paternal grandfather live to 97 and great aunt on your mother's side hit 93? While you may be delighted with your wonderful genes, you should also be concerned about something that every...Read More →