Glossary
Investment analysis tool
Definition
An investment analysis tool is an interactive technological tool that produces simulations of investment outcomes. FINRA Rule 2214 allows broker-dealers to offer them with specific disclosures, an exception to the general ban on projections in Rule 2210.
How investment analysis tool works
Required disclosures include the criteria and methodology, limitations and key assumptions, and that results may vary with each use and over time.
Advisers have a parallel concept in the SEC Marketing Rule adopting release.
Why it matters to a firm
Dual registrants must satisfy both regimes before embedding projection tools.
Calculators that use investment analysis tool
Questions about investment analysis tool
Which FINRA rule applies?
Rule 2214.
Are projections otherwise allowed?
Rule 2210 generally prohibits them.
Who must comply?
Broker-dealers and associated persons.
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Related terms: SEC Marketing Rule · Hypothetical performance
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