Suitability 2020-06-25 08:00:00

Suitability

A firm must ensure that an investment is suitable for an investor as outlined by Financial Industry Regulatory Authority (FINRA) Rule 2111. Suitability ensures that an investor’s situation matches the particular investment recommended by an investment firm. FINRA has specific rules for determining this match. In general, suitability can be determined from an investor’s profile, which contains information such as the investor’s risk tolerance, investment time frame, and goals. Suitability is not the same as fiduciary standards/requirements.

 


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