What Is a Registered Investment Advisor?

What Is a Registered Investment Advisor?
Written By
Carl E. Sera, CMT
Published On
April 26, 2023

Making financial decisions requires expertise and knowledge to avoid making a mistake. What are registered investment advisors, and how do they help? Let’s explore the requirements to become a registered investment advisor and tips for choosing the right RIA.

What Is a Registered Investment Advisor?

Registered investment advisors, or RIAs, advise clients on various securities investments and can potentially manage their investment portfolios. They register with state securities administrators or the U.S. Securities and Exchange Commission (SEC).

Registered investment advisors provide fiduciary obligations to clients, which is a fundamental duty to provide investment advice that fits the client’s best interest. RIAs avoid putting their interests in the forefront, helping clients navigate options that suit their lifestyles and investment portfolios.

RIA Requirements

Registered investment advisors must follow certain procedures and practices when advising their clients. Firstly, they must have SEC registration and fully disclose to clients any potential conflicts or risks regarding interest in specific transactions. Secondly, RIAs must prove that any risks will be disclosed and that investments could suit the client’s needs.

RIAs must also provide extensive documentation that complies with record-keeping regulations for the SEC. Additionally, RIAs must act as fiduciaries in the client's best interest to avoid conflict of interest. Lastly, RIAs must meet Financial Industry Regulatory Authority (FINRA) requirements.

Choosing a Qualified RIA

You can choose the right registered investment advisor in a few ways. Firstly, check the services they offer, including the level and type of advice they offer. It can vary in each firm, so it’s crucial to find an organization one that fits your needs. Secondly, check with Form ADV, which investors use to register with the state securities authorities and the SEC. This documentation provides detailed information about the firm, such as assets under management, client types, and fees. Lastly, check their AUM, or assets under management, to compare assets.

At Sera Capital, we have all your financial investment needs covered. Our specialty fee-only fiduciary financial advisors provide 1031 and 721 exchange services, Delaware Statutory Trust practices, and other real estate investment opportunities. We focus on educating, advising, and managing clients’ investments through books, videos, blogs, newsletters, and other resources for pursuing extensive investment processes. Schedule a 30-minute phone call today if you have any questions regarding our real estate investment practices.

Carl E. Sera, CMT

Carl E. Sera, CMT

Managing Principal, Sera Capital
Carl Sera is a Chartered Market Technician and the Managing Principal at Sera Capital Management, LLC. He has over 14 years of experience in the financial services industry with a focus on investment management.

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