Options Disclosure Document (ODD)
Chapters in this video
- 0:00 What the ODD is and who prepares it
- 1:48 The five-step account approval sequence
- 2:53 Trading before the signed agreement: the 15-day trap
- 4:10 Closing transactions only restriction
- 5:12 Who can approve: ROP and branch manager rules
- 6:15 10-business-day backstop for non-principal managers
- 6:56 Rapid-fire exam recap
What this video covers
- What the Options Disclosure Document (ODD) is, its official title, and why the Options Clearing Corporation (OCC) prepares it rather than FINRA or the broker-dealer
- When the ODD must be delivered relative to account approval, and why delivery after approval is never permitted
- The five-step account-opening sequence and why trading can begin after approval but before the signed options agreement is returned
- The 15-day deadline for returning the signed options agreement, when the clock starts, and what happens if it expires (closing transactions only restriction)
- The three specific confirmations a customer makes when signing the options agreement
- Who is qualified to give written approval for an options account (branch manager or Registered Options Principal), and why a registered representative never can
- The 10-business-day backstop rule when a non-principal branch manager gives initial approval and an ROP must follow up in writing
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