SIE practice questionmediumFiduciary Duty and Suitability
A registered representative recommends a speculative small-cap stock to a risk-averse retiree. Which principle is most likely violated?
- ABest execution
- BSuitability✓ Correct answer
- CFair pricing
- DDisclosure
Explanation
Why B — Suitability
Suitability requires recommendations align with client risk tolerance and objectives. Best execution, fair pricing, and disclosure are important, but do not directly address mismatched recommendations.
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