Exam Weight: ~3 questions (3% of exam)
Understanding the different types of clients is fundamental to providing suitable investment advice. Each client type has distinct legal structures, tax treatment, and liability characteristics that affect how an investment adviser serves them.
What You'll Learn
- Individuals, natural persons, sole proprietorships, and investment suitability for individual clients
- Business entities: general partnerships, limited partnerships, LLCs, C-corporations, and S-corporations
- Trusts (revocable, irrevocable, testamentary), estates, trustee fiduciary duties under UPIA, and who is the IA's client
- Private foundations, public charities, and donor-advised funds: funding sources, distribution requirements, and tax-deduction differences