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Form ADV: Search for Information on Financial Advisors

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Form ADV from the Securities and Exchange Commission (SEC), the leading financial industry regulatory authority, is your not-so-secret weapon for researching a financial advisor’s background. However, this form contains so much detailed information that you could get lost scanning its pages.

That’s why we’re here to help you understand Form ADV, what it includes and how to find important information quickly.

What is SEC Form ADV?

Form ADV is the uniform application for investment adviser registration. After initial registration, all registered investment advisers file an updated Form ADV each year with the SEC and state securities authorities. Firms must report exhaustive information in the Form ADV filing, and this includes exact facts on figures on:

  • Fees
  • Services
  • Conflicts of interest
  • Investment strategies
  • Disciplinary actions, if any
  • Assets under management (AUM)

Registered investment advisors (RIAs) must file Form ADV so that current and prospective clients can evaluate an advisor’s business practice beyond industry jargon and self-promotion and on a firm’s website — including any risks the investor may face when working with the advisor.

Where can you find Form ADV?

You can find any SEC-registered investment adviser’s Form ADV on the SEC’s Investment Adviser Public Disclosure (IAPD) website. There, you can perform a Form ADV search for any firm’s most recent filing using the firm’s name, location or Central Registration Depository (CRD) number, which is the license number the industry regulatory authority FINRA issues to firms.

Here’s the search box you’ll see.

Form adv search box

The site then brings you to a page with your search results.

Form ADV search results

To make sure you’re clicking the correct result (as firms can have multiple listings), look for the listing with “IA – Investment Adviser Firm” and click “More Details.” 

ADV more details

That will bring you to the firm’s official IAPD page and its most recent Form ADV.

Captrust ADV home

What can a Form ADV search tell me?

There’s a wealth of information inside a Form ADV. We’ll help you navigate each section like a pro and highlight the information you’ll find in each part.

Form ADV Part 1

Part 1 is a disclosure that’s in a check-the-box, fill-in-the-blank format, which is not the most exciting to read, but it does contain helpful information, such as:

  • States licenses. You can see the states in which the advisor is licensed to do business under Item 2.C: State Securities Authority Notice Filings and State Reporting by Exempt Reporting Advisers.
  • Employees, clients and compensation. Find the number of employees, advisors and clients the firm has, client types and how advisors are compensated in Item 5: Information About Your Advisory Business.
  • Affiliations. Discover other firms that the advisor works with and the principal business of those firms in Item 7.A: Financial Industry Affiliations.
  • Assets under management. See how much money others have entrusted the firm to manage and the firm’s total number of clients in Item 9: Custody.
  • Use of an individual public accountant. Learn whether the firm uses an independent public accountant to audit its investment vehicles or client accounts in Item 9: Custody, part C.
  • Disclosure information. See if the firm or its employees have been subject to regulatory actions in the past 10 years in Item 11.
  • Disciplinary action. If the firm or its employees have disclosures, you can get the details of all disciplinary actions taken and the resolutions in DRPs (Disclosure Reporting Page).

To help you quickly navigate to the sections above, we recommend using the “View Form ADV By Section” feature in the IAPD website left-hand sidebar.

Form ADV by section

This will bring you to this page where you can click just the sections you want to read instead of scrolling through a long Form ADV.

adv section search sidebar

Form ADV Part 2

Part 2 items are generally an easy read and broken into two subparts: Part 2a and Part 2b.

Part 2a

You can think of Part 2 as a marketing brochure that clearly explains how the firm works, its fees and how it handles clients’ money. If the firm changes how it does business, it must clearly outline the changes when it files a new Form ADV each year, then offer you a revised brochure.

Expert tip: Remember that firms earning fees and commissions from certain business practices isn’t illegal or unethical. However, you should be well-informed about when and how your advisor earns money.

Part 2a includes information about:

  • Business practices. A description of the firm’s business, services offered and the total number of clients.
  • Fees and compensation. How your advisor is compensated, including if the fees are billed separately or deducted from your accounts, along with a fee schedule and if fees are negotiable.
  • Performance-based fees. If your advisor accepts performance-based fees, they must disclose them.
  • Investment strategies and material risks. The firm must describe its investment strategies and the material risks each presents to investors.
  • Disciplinary information. The material facts about any disciplinary action relevant to potential clients when evaluating the advisor.
  • Code of ethics. A description of the advisor’s code of ethics and potential conflicts of interest.

Part 2b

Called the “brochure supplement,” advisory firms must provide you with a Form ADV part 2b for each person who provides you with investment advice. This includes anyone at the firm who makes discretionary investment decisions on your behalf, even if that person never has direct contact with you.

Form ADV Part 3

Form ADV part 3, called the “Relationship Summary,” is the easiest part of the form to digest. The advisor must summarize in “plain English” much of the information in Part 2, including services, fee structure, conflicts of interest and disciplinary actions.

Part 3 also includes key questions to ask an advisor and where you can go to get more information about the firm.

After your Form ADV search

A Form ADV is only one step in choosing an advisor, and it’s not a substitute for an in-person interview.

As you go through the advisor’s Form ADV, take notes on any information that raises concerns or confuses you, then bring these questions up when you meet with the advisor. They should be able to answer your questions openly and confidently.

If you are uncomfortable with the advisor or their answers to your questions, don’t be afraid to keep looking. There are plenty of advisors out there. It’s worth it to take the time and effort to find the right advisor for you.

Frequently asked questions

Form ADV is the disclosure document that registered investment advisors must provide to the SEC and clients. It includes key information about the advisor’s business practices, investing strategies, fee structure and disciplinary history.

Form ADV filings are publicly available on the SEC’s Investment Adviser Public Disclosure (IAPD) website.

Beyond Form ADV, you can also research a financial advisor through your state securities regulator. You can find your state regulator’s contact information at the North American Securities Administration website. In addition, FINRA offers an online broker research tool called BrokerCheck, where you can review a broker’s background.

The “Find a Financial Advisor” links contained in this article will direct you to webpages devoted to MagnifyMoney Advisor (“MMA”). After completing a brief questionnaire, you will be matched with certain financial advisers who participate in MMA’s referral program, which may or may not include the investment advisers discussed.