SIE practice questionhardOptions Strategies
A representative recommends frequent buying and selling of options to generate commission revenue, regardless of client objectives. This is a violation of:
- ASEC reporting rules
- BRegulation D
- CSuitability and anti-churning rules✓ Correct answer
- DMSRB new issue requirements
Explanation
Why C — Suitability and anti-churning rules
Churning for commissions violates suitability/anti-churning rules. Regulation D (B) relates to private placements. SEC reporting (C) and MSRB new issue rules (D) are unrelated.
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