Regulations & ConductQuestion 120 of 125
The Securities Investor Protection Corporation (SIPC) protects customers by:
a.Guaranteeing against market losses on investments
b.Providing limited coverage of customer cash and securities if a member broker-dealer fails
c.Insuring bond issuers against default
d.Setting margin requirements
Explanation
SIPC, established under the Securities Investor Protection Act, provides limited protection for customers' cash and securities if a member broker-dealer becomes insolvent, up to statutory limits. It does not protect against ordinary market losses or the decline in value of investments.
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- Which of the following is a prohibited practice for a registered representative?
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- A registered representative who wishes to engage in an outside business activity must:
- 'Selling away,' or participating in private securities transactions without the firm's knowledge and approval, is:
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