January 15, 2020
SEC-registered investment advisers should be allowed to invest "participating" clients' funds in Regulation D offerings. A "participating client" is one who has formally notified their RIA via letter that they want to participate in qualified private placements.
This provision WOULD NOT make all clients of an RIA an accredited investor. If that were the case, then any RIA client would be eligible to invest in Reg D offerings on their own.
Modern portfolio theory shows that diversifying an investment portfolio is the best way in which to earn a return commensurate with the risk taken. Allowing RIAs to invest client funds in Reg D offerings that they deem worthwhile will increase the diversity of their clients' investment portfolios and, as a result, enhance performance.
I am a former financial operations principal of a broker-dealer in good standing and have passed the Series 7, 24, 28, and 63 FINRA exams.
Respectfully submitted,
Robert R. Champion, President
Marketplus Captial Company LLC