Series 6 STC Chapter 9-12 Questions with 100%
Correct Answers
What must be disclosed to clients before executing a
trade? Correct Answer: Risks, costs, fees, and conflicts of
interest related to the investment.
In what two capacities can a broker-dealer act when
executing trades? Correct Answer: Agency (commission
disclosed) or principal (markup/markdown).
What is a soft-dollar arrangement? Correct Answer:
When advisers direct trades to broker-dealers for
research/services that benefit clients.
What rule governs acceptable soft-dollar services?
Correct Answer: SEC Section 28(e) services must benefit
clients directly.
How often must client account statements be sent?
Correct Answer: Quarterly or monthly if activity occurs.
What information must trade confirmations include?
Correct Answer: Identity, price, quantity, date, capacity,
yield, and settlement date.
, When must account record updates be confirmed to
clients? Correct Answer: Within 30 days of change or
next statement.
How long must broker-dealers retain records? Correct
Answer: 3-6 years depending on record type.
What is FINRA Rule 2165? Correct Answer: Protects senior
investors from financial exploitation.
Who is a trusted contact person? Correct Answer:
Individual designated for suspected exploitation or
concerns.
How long can firms hold disbursements under FINRA Rule
2165? Correct Answer: Up to 55 business days with
extensions.
What is ACATS? Correct Answer: Automated Customer
Account Transfer Service used for transferring accounts
between firms.
How long does a carrying firm have to complete a
validated ACATS transfer? Correct Answer: Three
business days.
Correct Answers
What must be disclosed to clients before executing a
trade? Correct Answer: Risks, costs, fees, and conflicts of
interest related to the investment.
In what two capacities can a broker-dealer act when
executing trades? Correct Answer: Agency (commission
disclosed) or principal (markup/markdown).
What is a soft-dollar arrangement? Correct Answer:
When advisers direct trades to broker-dealers for
research/services that benefit clients.
What rule governs acceptable soft-dollar services?
Correct Answer: SEC Section 28(e) services must benefit
clients directly.
How often must client account statements be sent?
Correct Answer: Quarterly or monthly if activity occurs.
What information must trade confirmations include?
Correct Answer: Identity, price, quantity, date, capacity,
yield, and settlement date.
, When must account record updates be confirmed to
clients? Correct Answer: Within 30 days of change or
next statement.
How long must broker-dealers retain records? Correct
Answer: 3-6 years depending on record type.
What is FINRA Rule 2165? Correct Answer: Protects senior
investors from financial exploitation.
Who is a trusted contact person? Correct Answer:
Individual designated for suspected exploitation or
concerns.
How long can firms hold disbursements under FINRA Rule
2165? Correct Answer: Up to 55 business days with
extensions.
What is ACATS? Correct Answer: Automated Customer
Account Transfer Service used for transferring accounts
between firms.
How long does a carrying firm have to complete a
validated ACATS transfer? Correct Answer: Three
business days.
