When the SEC adopted its modern advertising rules in 1961, it said that “advisers are professionals and should adhere to a stricter standard of conduct than that applicable to merchants.” As an investment adviser—whether state or SEC-registered—you are accountable for all of the information that is included in your advertising. In sum, the information therein must be truthful and supportable, and if it includes any performance results, you must follow the specific rules set forth herein, and have documentation supporting that performance.
In the current environment, it is challenging for emerging managers to attract investors and capital. Yet, studies are showing that emerging managers are outperforming more established mega funds with similar risk. This is an important selling point for talented emerging fund managers who offer a founder’s share class. In effect, they can offer investors the best of both worlds—higher returns as a result of demonstrable outperformance and lower fees.
All registered investment advisers—including exempt reporting advisers—are required to file various regulatory and compliance filings throughout the year. THE MOST IMPORTANT OF THEM IS THE ANNUAL UPDATING AMENDMENT ON FORM ADV.
Year End Compliance Matters.
The staff of the SEC recently stated that a competent Chief Compliance Officer (“CCO”) must develop in-depth knowledge in nine areas.
Guidance for the use of Social Media by Investment Advisers.