An accredited investor is any entity or person authorized to invest in private securities that are not registered with the SEC. Potential investors must meet certain requirements to have an accredited status, whether income, knowledge (such as via accredited investor professional certification) or experience to handle the risks inherent with these securities. Recent amendments have enlarged the definition of “accredited investor” as given in Regulation D, Rule 501(a). They now include:
Certain Designated Professionals
Individuals who hold certain professional certifications, credentials, or designations in good standing from an accredited educational institution recognized by the SEC may qualify for accredited investor status.
Series 7, 65, and 82 Exams Breakdown
The Financial Industry Regulatory Authority (FINRA) administers Series 7, 65, and 82 licenses. A couple of these licenses require specific education or sponsorship in order to obtain. However, candidates may secure a Series 65 license independently with a simple understanding of economics combined with some committed studying and the passing of an exam. These accredited investor professional certification options are ideal for achieving accredited investor status.
Series 7
The Series 7 exam – also referred to as the General Securities Representative exam – when passed, allows licensees to trade securities such as mutual funds, stocks, municipal securities, options, and variable contracts. This license is a prerequisite for beginning stockbrokers in order to trade. Some states require registered representatives to pass the Uniform Securities Agent State Law Exam (Series 63 exam) as well.
Series 65
Passing the Uniform Investment Adviser Law Exam – Series 65 exam – permits any person to operate as an investment advisor. Investment advisors can help clients on matters pertaining to management strategies, retirement planning, laws, and regulations. The candidate does not need a sponsor to take the exam. Some state requirements may apply depending on you use the license.
Series 82
Passing the Private Securities Offerings Representative Exam – Series 85 exam – enables financial professionals who represent a sponsor organization to conduct private security transactions for clients.
The SEC issued an order stating that natural persons who hold in good standing Series 7, 65, or 82 licenses are designated as accredited investors. In addition, the SEC retains the authority by order going forward to add other certifications, credentials, or designations, once it has provided notice and a timeframe for public comment. The accredited investor professional certification, credential, and designation options currently recognized by the SEC are located on the agency’s website.
