SIE practice questionmediumRegistered Representative Duties
What must a registered representative do before recommending an options strategy?
- ADetermine if the account is approved for options trading and evaluate suitability✓ Correct answer
- BRecommend only covered call strategies
- CHave customer sign all trade confirmations first
- DRequire customer to post full cash for all trades
Explanation
Why A — Determine if the account is approved for options trading and evaluate suitability
Suitability and approval for options trading are regulatory requirements. Representatives are not limited to covered calls, customer signatures are not required on confirmations before recommendations, and full cash is not always necessary.
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