Uniform Securities Agent State Law (Series 63) Practice Exam

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Study for the Uniform Securities Agent State Law (Series 63) examination with flashcards and multiple choice questions, each question includes hints and explanations. Prepare effectively and ace your exam!

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Who does a broker represent when acting on a transaction?

His own account
Accounts of customers
The firm itself
The dealer

The correct answer is: Accounts of customers

A broker primarily acts on behalf of customers when facilitating transactions. This role involves executing trades and managing purchases or sales in the best interests of their clients. The broker's fiduciary responsibility requires them to prioritize the needs and interests of their customers, putting their priorities above personal gains or those of the firm. Acting on behalf of customers means that the broker aims to secure the best possible terms for them, which includes finding favorable prices and executing trades efficiently. This relationship is foundational in the brokerage industry, heavily emphasized in compliance and ethical standards. Understanding that a broker's primary loyalty lies with their customers is essential for grasping the basics of brokerage practices and the legal framework governing these transactions.