Rule 206(4)-1(d)(5)

Performance: extracted performance must provide / offer the total portfolio performance

performanceextracted-performancetotal-portfolio

Verbatim from the rule

An advertisement may not include any extracted performance unless the advertisement provides, or offers to provide promptly, the performance results of the total portfolio from which the performance was extracted.

Source: 17 CFR § 275.206(4)-1 on eCFR.

What violations look like

Newsletter

Our top 10 holdings returned 28% last year.

Why it's flagged: Extracted performance — you’ve cherry-picked a sub-set of the portfolio. (d)(5) requires you to provide or offer the total portfolio’s performance with the same prominence so the reader can see the full picture.

Compliant rewrite

Our top 10 holdings returned 28% net last year; the portfolio overall returned 14% net for the same period. Full holdings list available on request.

Website

A page highlighting the firm’s "winners" — three positions that doubled over the past three years.

Why it's flagged: Same pattern. The total portfolio’s annualized return for the period must be offered with equal prominence; otherwise the extraction creates an inflated impression of skill.

Compliant rewrite

Either remove the page, or pair each highlighted position with the full portfolio’s annualized return for the same period and a note that not all holdings performed similarly.

Run Rule 206(4)-1(d)(5) on your own copy.

Paste any draft — LinkedIn post, newsletter, website copy — and Safe to Publish flags the Rule 206(4)-1(d)(5) issues with citations to the rule and a suggested rewrite.

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This page is for educational purposes and is not legal advice. Safe to Publish is not a law firm. Compliance decisions remain the responsibility of the registered investment adviser. See Terms.