SIE Exam Question 480: Answer and Explanation

Question: 480

Which of the following is not a violation of the rules of conduct?

• A. Recommending a mutual fund based on a pending dividend to an investor seeking income.
• B. Showing a client the past performance of a mutual fund for the last 3 years since its inception.
• C. Implying that FINRA has approved the firm.
• D. Recommending a security because of its future price appreciation.

Correct Answer: B

Explanation:

B: Showing a client the past performance for a mutual fund that has only been around for 3 years is in line with the regulations. All of the other choices are violations.