Chapter 14 preview
Chapter 14: Investment Risks, Returns and Disclosures
Chapter 14 covers investment risk types, cost basis methods, books and records requirements, and senior investor protections. Systematic risk affects the whole market; unsystematic risk is specific and diversifiable. The wash sale rule disallows a loss if the same security is repurchased within 30 days. Long-term capital gains (held >12 months) are taxed at preferential rates; short-term gains are ordinary income. Trusted contact persons are designated for customer wellbeing — they have no account authority.
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Investment Risks, Returns and Disclosures
Chapter 14 covers investment risk types, cost basis methods, books and records requirements, and senior investor protections. Systematic risk affects the whole market; unsystematic risk is specific and diversifiable. The wash sale rule disallows a loss if the same security is repurchased within 30 days. Long-term capital gains (held >12 months) are taxed at preferential rates; short-term gains are ordinary income. Trusted contact persons are designated for customer wellbeing — they have no account authority.
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Key concepts
- Required Disclosures
- Soft-Dollar Arrangements
- Client Notifications
- Books and Records
- Financial Exploitation of Specified Adults - FINRA Rule 2165
- ACATS-Transferring Accounts
- Investment Risks
- Investment Returns
- Cost Basis, Capital Events, and Return of Capital
- Required Disclosures
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