17Feb/120
ARCHIVED POSTExam Alert: SEC rule excludes home value from net worth calculation for “qualified clients”

A qualified client is a client that may be charged performance-based fees by an investment adviser.  The threshold for determining whether a client is a qualified client is if they have at least $1 million in assets under management with the adviser or if they have a net worth of at least $2 million.  An SEC rule change announced on February 15, 2012, will exclude the value of an investor's home (primary residence) from the net worth calculation.  The rule amendment will take effect 90 days after publication in the Federal Register.

Source: SEC Release 2012-29

This alert applies to the Series 63, Series 65, Series 66, and Series 24.

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