5. Which of the following is/are true regarding fee-based accounts? I they may b

Question

5. Which of the following is/are true regarding fee-based accounts? I they may be more expensive for clients that trade less activelv the lack of commission could encourage the client to trade more than they should or would for non-registered accounts, the fees are not tax-deductible · V. brokers cannot recommend third-party mutual funds b) I& c) IV 6. A client would like to invest in exchanee-traded funds but wants professional tihe portfolio. What fee-based arrangement would be appropriate? management for selecting and for asset allocation of a) ETF Wrap b) Mutual Fund Wrap c) Discretionary Account d) Multi-Disciplinary Account 7. What fee-based arrangement would be appropriate for an affluent client who is leaving the country for a short period of time and will therefore be unable to manage his investments? a) Private Family Office b) Fee-Based Managed Account c) Discretionary Account d) Separate Managed Account . Which of statement is true regarding discretionary accounts? a) Salespersons can solicit discretionary accounts only if they are also acting as trading partner, director or officer b) Discretionary agreements from clients must be in writing and c) Discretionary accounts are managed on a continuous basis, usually d) Trades execu approved by a director, partner or officer for a management fee ted through accounts do not require approval of a partner, director or officer as long as the client's investment obiectives are clearly specified and the client has siven wiitten approval for discretionary trading-

Explanation / Answer

5. d they may be more exprensive for clients that trade less actively ,lack of commission will encourage the clients to trade more and for non registered accounts, the fees is not deductible.

6. b mutual fund wrap

7.a private family office

8. d trades executed through discretionary accounts do not require approval of a partner, director or officer as long as the clients investment objectives are clearly specified and the client has given writtten approval for discretionary trading.

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