bapswarrior

Which of the following statements regarding allocating trades is CORRECT? It is permissible under the Standards to allocate trades:

A) on a pro-rata basis over all suitable accounts.

B) based upon compensation arrangements.

C) based upon any method the firm deems suitable so long as the allocation procedure has been disclosed to all clients.

---

It is permissible to allocate trades on a pro-rata basis over all suitable accounts. It is not permissible to base allocations upon compensation arrangements. Any method is not necessarily suitable, and disclosure does not absolve the member from ensuring that the allocation is necessarily fair.

bapswarrior

Which of the following statements regarding allocating trades is CORRECT? It is permissible under the Standards to allocate trades:

A) on a pro-rata basis over all suitable accounts.

B) based upon compensation arrangements.

C) based upon any method the firm deems suitable so long as the allocation procedure has been disclosed to all clients.

---

It is permissible to allocate trades on a pro-rata basis over all suitable accounts. It is not permissible to base allocations upon compensation arrangements. Any method is not necessarily suitable, and disclosure does not absolve the member from ensuring that the allocation is necessarily fair.