Securities Trader Representative (Series 57) Practice Exam

What must be reported by broker-dealers after executing trades for clients?

1. The profit margin achieved

2. The details of the executed order

3. The broker's market position

4. The customer's credit rating

The correct answer is: The details of the executed order

Broker-dealers are required to report the details of executed orders to ensure transparency and accountability within the trading process. This information typically includes the specifics of the trade such as the price at which the securities were bought or sold, the quantity of shares or other securities, the time of execution, and the identity of the clients involved in the transaction. Such reporting helps in maintaining accurate records for both regulatory purposes and to inform clients about their transactions. This practice is crucial for regulatory compliance as it allows oversight bodies to monitor market activities and facilitates the resolution of any disputes between clients and broker-dealers. Additionally, it provides clients with the necessary information to understand the outcomes of their trades. While other options suggest aspects that might be relevant in different contexts (like profit margins or credit ratings), they are not standard reporting requirements post-execution of trades.