Series 55

Commissions And Trade Complaints - Introduction

A firm handling a customer’s order is entitled to be compensated for executing the customer’s order. How the firm is compensated depends on the way the firm executes the order. Firms are also entitled to be compensated for the risk they take when acting as a market maker and holding stock in their inventory accounts. Even when considering the fact that firms are entitled to be compensated for their services and the risks they take, the prices paid by customers inclusive of commissions and mark ups must be reasonably related to the price of the security. Series 55 candidates must be aware of the different circumstances that justify the fees charged to customers as well as the conditions that would make fees unreasonable.



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