SIE practice questionmediumFINRA Rules - Best Interest
According to the SEC's Regulation Best Interest, a registered rep must:
- AOnly consider investments with the highest yield
- BAct in the customer’s best interest when making a recommendation✓ Correct answer
- CAlways recommend mutual funds
- DDisregard the customer’s risk tolerance
Explanation
Why B — Act in the customer’s best interest when making a recommendation
Reg BI requires broker-dealers and registered representatives to act in the customer's best interest when making a recommendation. Highest yield or a single product type is not always appropriate, and customer risk tolerance must be considered.
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