Institutional and Discretionary Accounts

What this video covers

• Which entities qualify as institutional accounts automatically (financial institutions and registered investment advisers) versus which must meet the $50 million total assets test (any other person)
• The three specific exemptions institutional accounts receive: associated person responsibility record, trusted contact person, and reasonable efforts information
• Why every institutional account is an institutional investor, but not every institutional investor holds an institutional account, and what extra entities communications rules add
• What true discretion means under the customer account information rule: the firm decides what security to buy or sell, or how much, without customer approval per transaction
• Why price and time discretion over an already-chosen security does NOT trigger the dated signature recordkeeping duty
• The exact record required for discretionary accounts: a dated signature of each associated person authorized to exercise discretion, not the broader authorization process itself
• How to spot exam traps that confuse the customer account information rule's recordkeeping duty with the separate principal acceptance process for exercising discretion