SIE practice questionmediumFiduciary Duty/Suitability/Best Interest
A registered representative recommends complex options strategies to a client who has limited investment experience and a low risk tolerance. This could be a violation of which rule?
- ABest execution
- BSuitability✓ Correct answer
- CFreeriding
- DBreakpoint sales
Explanation
Why B — Suitability
Suitability rules require recommendations to align with client financial situations and risk tolerance. Best execution concerns trade price, freeriding is a margin violation, and breakpoint sales relate to mutual fund pricing, not recommendations.
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