Canadian Securities Course (CSC) Level 1 Test 2025 – 400 Free Practice Questions to Pass the Exam

Question: 1 / 400

Explain the know your client rule.

Client information is irrelevant for securities transactions

Security dealers must not inquire about client objectives

Clients do not need to provide financial details

Security dealers and IAs must verify client information and ensure recommendations match client needs

The "know your client" rule in the securities industry requires security dealers and investment advisors to gather relevant information about their clients to understand their financial situation, investment knowledge, risk tolerance, investment objectives, and any other relevant factors. By verifying client information and ensuring that their recommendations align with the client's needs, the rule aims to promote suitability and protect investors. This rule helps to establish a level of trust between the client and the advisor, ensuring that investment recommendations are appropriate based on the client's individual circumstances.

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