Account Types
A customer tells their registered representative, "Buy 500 shares of Microsoft when you think the price is right." Is this a discretionary order?
This is NOT discretionary. Time and price authority alone does not constitute discretion. Since the customer specified both the security (Microsoft) and the quantity (500 shares), the rep only has flexibility on timing a
Complete Analysis & Legal Rationale
This is NOT discretionary. Time and price authority alone does not constitute discretion. Since the customer specified both the security (Microsoft) and the quantity (500 shares), the rep only has flexibility on timing and price execution, which requires no written authorization.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
Does not match the governing securities rule described in the explanation.
Does not match the governing securities rule described in the explanation.
Matches the verified teaching point in the explanation.
Does not match the governing securities rule described in the explanation.
Official Standard: Outline-level citation: item maps to Series 7 topic coverage. Prefer a specific FINRA/SEC/MSRB rule citation in a later author pass.