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
Frequent trading recommended to generate commissions regardless of client objectives is churning and violates suitability and anti-churning rules. Regulation D, SEC issuer reporting, and MSRB new-issue requirements are unrelated to this conduct.
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