What is included as part of ADV Part 2?

ADV Part 2 is a crucial document that investment advisers provide as part of their regulatory obligations. It is primarily designed to inform clients about the adviser’s business practices, fees, and any potential conflicts of interest. The content of ADV Part 2 serves as a written brochure that details the advisory firm's business practices, including the services offered, the fee structure, and any disciplinary history that may be relevant to a client's decision-making process.

This brochure is intended to be clear and understandable to clients, enabling them to make informed choices regarding their investment options. The use of straightforward language and organized sections helps to convey the necessary information effectively. Including this comprehensive overview helps promote transparency and build trust between the adviser and their clients.

The other choices do not accurately represent the primary focus of ADV Part 2. Financial histories or credit reports, legal descriptions of practices, and summaries of performance fees, while potentially relevant in different contexts, do not encapsulate the essence of ADV Part 2 as a client-facing document aimed at communicating business practices directly to clients.