| This newsletter has been developed to provide | | | | professionals are other ways to describe an RIA. |
| insights into the operation of the financial services | | | | Insurance Agents are licensed by individual state |
| industry, and to help individual investors make | | | | Departments of Banking and Insurance. If the |
| decisions concerning the type of advisement that | | | | agent sells variable products, such as variable |
| best suits their needs. While there are many | | | | annuities or variable universal life insurance, they |
| professionals who provide investment advice in | | | | must also have an NASD License. |
| one form or another, there are certain credentials | | | | The NASD has many licenses, but many |
| and licenses financial professionals should possess | | | | professionals have at least a Series 65, which is |
| before you entrust them with your savings. We | | | | an NASD license needed to be a Registered |
| will explore the various licenses and certifications | | | | Investment Advisor in many states. This is the |
| to determine which type of professional might be | | | | minimum, short of having no license at all. In order |
| best suited to your needs. | | | | to be a Registered Representative, the minimum |
| Financial Advisor, Financial Consultant, Investment | | | | license needed is a Series 6 from the NASD. This |
| Advisor, Financial Planner, Registered | | | | entitles a Representative to sell mutual funds, and |
| Representative, Stock Broker, Variable Products | | | | obtain an affiliation with a securities firm. An |
| Agent or Insurance Agent are many of the | | | | insurance license to sell variable products enables |
| terms used in the financial services industry to | | | | the representative to also provide variable |
| describe the professional duties performed. Fee | | | | annuities or variable universal life insurance. |
| based or commission based compensation are | | | | In order to advise and transact stock, bond, REIT |
| terms which get thrown into the mix, causing | | | | and limited partnership sales, as well as mutual |
| client confusion. In reality, a licensed professional | | | | fund, ETF's, variable annuity and variable universal |
| can have all of those titles, perform all of those | | | | life sales, a Registered Representative needs to |
| services, which we just identified, and work in a | | | | attain a Series 7 license, as well as a variable life |
| fee or commission based capacity with a client. | | | | license. By obtaining a Series 63, disclosing all |
| The National Association of Securities Dealers | | | | investment advisement relationships to their |
| (NASD) is one of the associations which self | | | | broker/dealer and by registering with their state |
| regulates the securities industry. The Securities | | | | Bureau of Securities or the SEC, if assets are |
| and Exchange Commission (SEC) is the | | | | over 25 million, a registered representative can |
| government agency which oversees the NASD | | | | have a dual registration as a Registered |
| and the exchanges, such as the New York Stock | | | | Representative and Registered Investment |
| Exchange (NYSE). The NASD licenses Registered | | | | Advisor. Once this stage has been reached, an |
| Representatives, while the SEC or individual state | | | | Investment Advisor can demonstrate to a client |
| bureaus of securities register investment advisors | | | | whether fee based or commission based |
| (RIA). Financial Planner, Financial Consultant or | | | | compensation is best for the client. |
| other terms used to describe financial services | | | | |