3 ms·

This is great for employees of private funds and other things like that. It makes no difference at all to the average person complaining about the accredited in

This is great for employees of private funds and other things like that. It makes no difference at all to the average person complaining about the accredited investor rules preventing them from investing in sure-fire wins. It really doesn't matter how much of a genius you are at recognizing investment wins. If you can't give them enough cash to finance their operations for a significant period of time, the company isn't going to be interested in taking your money. If you can't meet the wealth guidelines, you're not gonna be able to give them enough money to be worth their time dealing with.

woah 6y ago
If the company has a process set up to accept investment, they don’t have to deal with each individual one at a time
tathougies 6y ago
The average person can now take the Series 65 exam for $60 or so and, if they pass, become an accredited investor. This is a huge change. Taking the wealth requirement from 1 million dollars to $60. EDIT: It's not $60, but $175, still a far cry from a million.
- sgc 6y ago
  I read it as requiring 3 licenses: "Series 7, Series 65, and Series 82" [Italics mine]. But your point stands in principle and it's a great change.
- nkohari 6y ago
  The series 65 is intended for people who want to manage other people's money. You should still be able to invest your own money as you wish.
  - tathougies 6y ago
    I completely agree with you and would like to see accredited investors go away as a concept. However, this new policy is strictly better than what we had, so it deserves praise.
- scott00 6y ago
  This is likely not true. You can't just sign up for FINRA exams as an individual; an eligible entity (broker-dealer or investment advisor) has to sign you up. And even if you have passed the relevant exam recently enough, you're not considered licensed unless you're working for an eligible entity who has submitted the appropriate paperwork to claim you as a registered representative. The easiest path this opens for someone not in the securities industry is to become a state registered investment advisor. In my home state of Illinois, that would require paying $400 a year to the state and $150 a year to FINRA, as well as subject you to a number of non-trivial regulatory requirements.
  - jkaplowitz 6y ago
    You need a sponsor for most FINRA exams, but Series 65 (and the introductory SIE exam) allows self-registration with no sponsor. I just reread the new accredited investor final rule, and as per footnote 102, people who qualify via Series 65 need to maintain in good standing a state-granted license or registration. No other requirements exist on top of that.
  - tathougies 6y ago
    You don't need a sponsor for Series 65. In my home state of Oregon, you have to pass the exam, and you have to be 'affiliated with a registered investment advising business', but this business can be owned by you. Which means that, if you take the exam, and register a corporation owned by you with the state (and pay a nominal tax of a few hundred dollars), post a 10k refundable bond, and maintain books properly, you can invest in previously inaccessible vehicles. Is this work... yes. But the capital requirements are so low that it broadens access to many more people. I'd expect companies to start forming around getting people their Series 65 and allowing them to affiliate themselves with the business for a fee. This is still significantly better in terms of accessibility than the $1million wealth requirement or income >$200k.
mikestew 6y ago
It makes no difference at all to the average person complaining about the accredited investor rules preventing them from investing in sure-fire wins. If it is a "sure-fire win", then individuals don't get to participate in those investments, institutions and people with a lot more money than you have get to participate. As an individual of only moderately high worth, you get the shit portrayed in the movie Boiler Room. Which is why whining about accredited investor rules annoys me: they can change the rules, but that isn't going to make companies want to deal with your small potatoes. They're not knocking on your door now, why would a rule change make any difference? Even if you cross the magic threshold, opportunities will not immediately knock on your door out of the blue. But if you want dents in your door from all the knocking, up your net worth from single-digit millions to double-digit.

woah 6y ago

If the company has a process set up to accept investment, they don’t have to deal with each individual one at a time

tathougies 6y ago

The average person can now take the Series 65 exam for $60 or so and, if they pass, become an accredited investor. This is a huge change. Taking the wealth requirement from 1 million dollars to $60. EDIT: It's not $60, but $175, still a far cry from a million.

sgc 6y ago
I read it as requiring 3 licenses: "Series 7, Series 65, and Series 82" [Italics mine]. But your point stands in principle and it's a great change.
nkohari 6y ago
The series 65 is intended for people who want to manage other people's money. You should still be able to invest your own money as you wish.
- tathougies 6y ago
  I completely agree with you and would like to see accredited investors go away as a concept. However, this new policy is strictly better than what we had, so it deserves praise.
scott00 6y ago
This is likely not true. You can't just sign up for FINRA exams as an individual; an eligible entity (broker-dealer or investment advisor) has to sign you up. And even if you have passed the relevant exam recently enough, you're not considered licensed unless you're working for an eligible entity who has submitted the appropriate paperwork to claim you as a registered representative. The easiest path this opens for someone not in the securities industry is to become a state registered investment advisor. In my home state of Illinois, that would require paying $400 a year to the state and $150 a year to FINRA, as well as subject you to a number of non-trivial regulatory requirements.
- jkaplowitz 6y ago
  You need a sponsor for most FINRA exams, but Series 65 (and the introductory SIE exam) allows self-registration with no sponsor. I just reread the new accredited investor final rule, and as per footnote 102, people who qualify via Series 65 need to maintain in good standing a state-granted license or registration. No other requirements exist on top of that.
- tathougies 6y ago
  You don't need a sponsor for Series 65. In my home state of Oregon, you have to pass the exam, and you have to be 'affiliated with a registered investment advising business', but this business can be owned by you. Which means that, if you take the exam, and register a corporation owned by you with the state (and pay a nominal tax of a few hundred dollars), post a 10k refundable bond, and maintain books properly, you can invest in previously inaccessible vehicles. Is this work... yes. But the capital requirements are so low that it broadens access to many more people. I'd expect companies to start forming around getting people their Series 65 and allowing them to affiliate themselves with the business for a fee. This is still significantly better in terms of accessibility than the $1million wealth requirement or income >$200k.

mikestew 6y ago

It makes no difference at all to the average person complaining about the accredited investor rules preventing them from investing in sure-fire wins. If it is a "sure-fire win", then individuals don't get to participate in those investments, institutions and people with a lot more money than you have get to participate. As an individual of only moderately high worth, you get the shit portrayed in the movie Boiler Room. Which is why whining about accredited investor rules annoys me: they can change the rules, but that isn't going to make companies want to deal with your small potatoes. They're not knocking on your door now, why would a rule change make any difference? Even if you cross the magic threshold, opportunities will not immediately knock on your door out of the blue. But if you want dents in your door from all the knocking, up your net worth from single-digit millions to double-digit.