Registered Investment Advisers

Goals

To understand the RIA market, including how many RIAs there are in the United States, the top 10 RIA firms in the United States, state and federal regulations pertaining to RIAs, and how one can become an RIA.

Early Findings

Registered Investment Adviser Market

  • According to Statista, there are 12,993 registered investment advisors in the United States.
  • Registered Investment Advisers serve almost 43 million advisory clients and have about $83.7 trillion in assets under management.
  • The top 1.1% of RIAs collectively manage 59.7% of all reported assets under managment.
  • Approximately 95% of RIAs are paid through asset-based fees based off of a percentage of their assets under management. About 3% are compensated through commission fees. The remainder are compensated through fixed-fees.

Top RIA Firms in the United States

The top 10 RIA firms in the United States based off of AUM are:

How to Become an RIA

  • Persons interested in becoming a registered investment advisor must pass the Series 65 (Uniform Investment Advisor Law) exam, file with the SEC or state, create an account with the Investment Adviser Registration Depository (IARD), and file Form ADV and the U4 forms with either the SEC or states.
  • The Series 65 exam is administered by the Financial Industry Regulatory Authority (FINRA). In order to pass, candidates must receive a score of 72.3% on the 130 question multiple choice exam.
  • Firms or individuals who act as an investment adviser on behalf of an investment company and any firm or individual with an AUM of more than $100 million must register with the SEC. Firms with an AUM under $100 million must register with their state.
  • After passing the Series 65 exam and registering with the SEC or state, RIAs must open an account with the Investment Adviser Registration Depository (IARD) in order to receive a CRD number.
  • Finally, RIAs must file Form ADV and the U4 forms with either the SEC or states. This is the official application used to become recognized as an RIA.



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