Series 63 - Chapter 5 || with 100% Accurate Solutions.
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Series 63 - Chapter 5
Institution
Series 63 - Chapter 5
contrivance correct answers any scheme, program or plan to defraud
a contrivance correct answers a scheme, program or plan to defraud is considered
self-dealing correct answers an unethical practice in which fiduciaries acts in their own best interest, rather than the best interest of clients...
Series 63 - Chapter 5 || with 100% Accurate Solutions.
contrivance correct answers any scheme, program or plan to defraud
a contrivance correct answers a scheme, program or plan to defraud is considered
self-dealing correct answers an unethical practice in which fiduciaries acts in their own best
interest, rather than the best interest of clients is considered
fiduciaries correct answers self-dealing occurs when these entities act in their own best interest,
rather than the best interest of clients
agents can borrow money from, or lend money to, clients only if the client is correct answers a
financial institution such as a bank
an agent's brother offers to lend the agent money to buy a new car. this is a violation if correct
answers the brother is also the agent's customer. agents cannot borrow from or lent to clients
(other than certain financial institutions) - not even family members
a type of strategy that is inappropriate for a client's retirement portfolio correct answers one that
involves excessive, unnecessary trading at high cost - such as daily portfolio adjustments or
rebalancing
a type of strategy that is inappropriate for a client's retirement portfolio include correct answers
dollar cost averaging, indexing or strategic allocation
a firm can enter a trade in a customer's margin account before the margin account is received,
provided correct answers the margin agreement is received promptly after the initial transaction
in the account
a firm asks a customer to complete a margin account agreement. however, the first trade is made
in the margin account before the agreement is returned. this is correct answers permitted,
provided that the margin agreement is received promptly after the initial transaction in the
account
if a customer trade in a margin account before the margin account agreement is returned, the firm
must assure that the agreement is received correct answers promptly after the initial transaction
in the account
an investor seeking income should not purchase high yield bonds or microcap stocks because
correct answers they are too risky for this objective
a type of bond that is considered too risky for investors seeking income or preservation of capital
is correct answers high yield - low quality junk bonds
, municipal bonds are suitable for correct answers investors in high tax brackets seeking tax
exempt income
municipal bonds are generally not suitable for correct answers investors in low tax brackets and
retirement plans. the tax benefits of municipal bonds are not optimized in retirement plans
switching clients between mutual funds with similar objectives is generally unsuitable and
prohibited unless correct answers there is a legitimate investment purpose that justifies the
potential tax and fee consequences
churning correct answers the violation that occurs when an agent trades in a discretionary
account in a manner inconsistent with a client's investment objectives is
frequent trading in a discretionary account is a churning violation when it is correct answers not
consistent with the client's objectives
blanket recommendations, which is a violation of customer-specific suitability obligations
correct answers an agent who makes the same investment recommendation to all his/her
customers is engaging in
blanket recommendations correct answers when an agent makes the same recommendation to all
customers
529 college savings plan correct answers another name for a qualified college tuition program
sponsored by states
clients who wish to save for a child's college education should consider a correct answers 529
plan
all written customer complaints must be followed up by taking three actions: correct answers -
escalating the matter to a supervisor
- sending the customer a written response
- storing records of the complaint
customer complaint definition correct answers a written grievance from a customer
when a customer complains about the service she is getting from her agent, the matter must be
escalated to a supervisor when the complaint is correct answers in writing
higher than normal commission are allowed when they are justified by these types of
circumstances correct answers less liquid securities, more difficult trade execution, and more risk
of execution to the firm
when a firm anticipates that a trade or pattern of trading will produce higher-than-normal
commissions, its ethical obligation to customers is to correct answers provide advance notice
explaining the reasons why
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