Trading Authorization

What this video covers

• The exact difference between full trading authorization (withdrawal rights permitted) and limited trading authorization (buying and selling only, no withdrawals)
• Why discretionary authority is a specific form of trading authorization where the agent can choose security, amount, or action without prior client consent per trade
• The three documentary requirements for third-party trading authorization: written power of attorney, copy on file at broker-dealer, third party identified on account records
• Whether a broker-dealer must accept a customer's power of attorney, and the lesser-known alternative of restricting permitted scope rather than outright refusal
• The four inherently fiduciary account types: trust, estate, custodial (Uniform Gifts to Minors Act / Uniform Transfers to Minors Act), and guardian accounts
• The single unifying fiduciary obligation across all such accounts: act in the best interest of the beneficiary, never for personal gain
• Why joint accounts are deliberately not fiduciary, and how the exam uses this distinction as a trap