Recommendations & StrategiesPregunta 59 de 110
An investment adviser recommending a strategy must ensure it is suitable. Which action best supports suitability?
a.Recommending the product paying the highest commission
b.Documenting the client's objectives, risk tolerance, and financial situation before advising
c.Applying the same portfolio to every client for consistency
d.Avoiding any discussion of risk to prevent client anxiety
Explicación
Suitability requires understanding and documenting the client's objectives, risk tolerance, financial situation, and needs before making recommendations. A one-size-fits-all approach or one driven by compensation ignores individual circumstances. As a fiduciary, an adviser must also fully disclose risks.
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