SIE practice questionhardTrade Execution
A firm receives a customer limit order to buy at $25 when the market is at $24.98. If the firm executes the trade for its own account at $24.99 before the customer’s order is filled, what violation has occurred?
- AChurning
- BTrade ahead✓ Correct answer
- CBreakpoint selling
- DInsider trading
Explanation
Why B — Trade ahead
Trading ahead means the firm executes for its own account before a client’s limit order at the same or better price. The other violations listed do not apply to this scenario.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 1,867+ SIE questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Related Trading & Settlement questions
- A customer wants to buy 100 shares of XYZ stock as soon as possible at the current market price. Which type of order…
- A broker-dealer attempts to inflate a security’s end-of-day price by placing trades minutes before the market closes.…
- A customer places a sell limit order for 100 shares of ABC at $25. Which of the following accurately describes how this…
- A customer purchases $30,000 of stock in a margin account. What is the minimum deposit required under Regulation T?