Series 7 practice questionmediumOptions Account — Approval Process
Before a customer can begin trading options, which of the following must occur?
- AThe customer must pass the Series 7 exam
- BThe customer must complete an options agreement, be approved by a Registered Options Principal (ROP), and receive the OCC Options Disclosure Document✓ Correct answer
- CThe customer must deposit a minimum of $100,000
- DThe customer must have at least 10 years of investment experience
Explanation
Why B — The customer must complete an options agreement, be approved by a Registered Options Principal (ROP), and receive the OCC Options Disclosure Document
Before trading options, a customer must complete an options account agreement providing information about financial status and trading experience. A Registered Options Principal (ROP) must review and approve the account. The customer must also receive the Options Clearing Corporation (OCC) Characteristics and Risks of Standardized Options document (the options disclosure document) at or before account approval.
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