Managing SEC Compliance: Marketing Rule Controls
The SEC Marketing Rule governs how registered investment advisers can create, share, and present performance and marketing materials to clients and prospects. YCharts is built to align with these requirements, giving home offices the tools needed to produce compliant materials by default. This guide breaks down the Marketing Rule's key requirements and the specific YCharts features home offices can use to stay compliant.
While YCharts is a technology provider and is not directly regulated by the SEC, our platform is engineered defensively to support the compliance mandates of our Registered Investment Adviser (RIA) clients under the SEC Marketing Rule (Rule 206(4)-1).
To ensure your firm can seamlessly satisfy its regulatory obligations when utilizing YCharts for client-facing deliverables, YCharts has hardcoded specific compliance frameworks directly into our workflow:
- Gross vs. Net Performance: Our report builder features customizable fee-input calculators, ensuring that anytime gross fund performance is displayed, net-of-fee returns can be presented with equal visual prominence.
- Standardized Timeframes: Platform templates default to the SEC-mandated 1-, 5-, and 10-year rolling performance intervals calculated from the most recent calendar period, restricting the risk of inadvertent 'cherry-picking.'
- Automated Risk Disclosures: Our dynamic disclosure engine automatically appends contextual, asset-class specific risk language to the footers of all generated PDF reports and comparison sheets based on the securities selected.
- Books & Records Retention: All user-generated reports, charts, and portfolios are securely archived in the cloud, providing an administrative audit trail to support your firm's five-year recordkeeping requirements.
- Compliant Interactive Client Presentations: Our Interactive Analysis Tool (IAT) enables advisors to conduct live, personalized portfolio discussions with clients in a controlled, read-only environment. This ensures any hypothetical analysis shared in real time is presented within the same compliance guardrails governing static reports, reducing the risk of unscripted or undocumented marketing communications.
The following settings work together to ensure every portfolio used in reports has a clearly defined service type, supporting compliance with the SEC Marketing Rule's net performance requirements.
Compliance Admin Access
Firms can also designate users as Compliance Admins, giving them visibility into all reports generated by users across the firm. This allows firms to monitor report activity centrally and confirm that users are consistently adhering to SEC requirements.
Advisory Fee Enforcement
Both settings are configured at the Client Group level, giving compliance teams control.
Service type in Portfolio Editor
When enabled, a Service Type field appears in the Portfolio Editor. Users must select one of two options — Advisory (for ongoing portfolio management, which requires an advisory fee before the portfolio can be saved) or Brokerage (for transactional services, which does not require a fee). This ensures advisory fees are captured at the portfolio level before a portfolio can be used.
Configurable: Yes | Required to save portfolio: Yes (Advisory) / No (Brokerage)
Require service type for report generation
When enabled, this setting blocks report generation for any portfolio that does not have a Service Type selected — including public model portfolios. Portfolios with a Brokerage service type are still eligible for reports, since an advisory fee is not required for brokerage services.
Configurable: Yes | Applies to public model portfolios: Yes
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