Advisor Glossary

Start with the pair that is most often confused. An investment adviser representative is a person, and a registered investment adviser is a firm. Continuum's movement counts are counts of investment adviser representatives (IARs), read from the SEC's public registration records.

Broker Protocol

The Broker Protocol (Protocol for Broker Recruiting), a 2004 agreement among signatory firms, permits an advisor moving between two signatories to take only the name, address, phone number, email address and account title of clients they serviced. They must resign in writing to branch management with a copy of that information and may solicit those clients only after joining the new firm.

Broker-Dealer

Under the Securities Exchange Act of 1934, a broker is a person engaged in the business of effecting securities transactions for the account of others. A dealer is a person engaged in the business of buying and selling securities for its own account, through a broker or otherwise; a broker-dealer firm performs one or both roles.

CRD Number

A CRD number is the identification number a firm or an individual carries in the Central Registration Depository (CRD), the registration system FINRA operates. FINRA describes the CRD program as covering the registration records of broker-dealer firms, branch offices and their associated individuals, including their qualification, employment and disclosure histories.

Form ADV

Form ADV is the form investment advisers use to register with the SEC or with state securities authorities and to amend those registrations; exempt reporting advisers use it to file their reports. Part 1A asks about the adviser, its business practices, the persons who own and control it, and the persons who provide investment advice on its behalf.

Form U4 and Form U5

Form U4 (Uniform Application for Securities Industry Registration or Transfer) is the form firms file to register an individual with a broker-dealer, as a representative or principal, or as an investment adviser representative. Form U5 (Uniform Termination Notice for Securities Industry Registration) ends that registration when the individual leaves the firm and records why they left.

Investment Adviser Representative (IAR)

An investment adviser representative (IAR) is an individual who performs advisory services on behalf of an investment adviser firm. For SEC-registered firms, SEC Rule 203A-3 defines an IAR as a supervised person of the adviser who has more than five clients who are natural persons and more than ten percent of whose clients are natural persons, not counting clients the rule excepts.

Office of Supervisory Jurisdiction (OSJ)

An Office of Supervisory Jurisdiction (OSJ) is any office of a FINRA member firm at which one or more of the supervisory functions listed in FINRA Rule 3110(f)(1) take place. They include order execution or market making, custody of customer funds or securities, final acceptance of new accounts, final approval of retail communications, and responsibility for supervising associated persons at other branch offices.

Registered Investment Adviser (RIA)

A registered investment adviser (RIA) is an adviser firm registered with the SEC or a state. The Investment Advisers Act defines investment advisers as persons who advise others as a business, for compensation, on securities' value or whether to invest in, buy or sell them, or issue securities analyses or reports for compensation as a regular business.

Registered Representative

FINRA Rule 1220 defines a representative as a person associated with a member firm, including assistant officers other than principals, engaged in its investment banking or securities business. That business includes supervision, solicitation, conduct of securities business and training persons for those functions; a registered representative is registered with FINRA through the member broker-dealer.

Wirehouse

A wirehouse is a national, full-service brokerage firm that employs its advisors, supervises them centrally and holds the client accounts. The term usually means Merrill Lynch, Morgan Stanley, UBS and Wells Fargo Advisors.