What Is Performance Advertising for RIAs?

Performance advertising refers to any marketing material that presents an adviser’s actual investment returns or track record. The Marketing Rule requires this data to be presented net of fees (or alongside gross figures with appropriate context), over specific time periods, and without cherry-picking favorable results.

The rule prohibits presenting gross performance without also showing net performance with equal prominence, and requires consistent time periods across any comparisons. It also bars selectively showing only the best-performing accounts or periods (sometimes called “cherry-picking”) while omitting less favorable results from the same strategy.

Firms need documented methodology for how performance figures are calculated and presented, and should retain records supporting any performance claim used in marketing.