You Work for a Securities Firm Matching Orders to Buy

question 132

Multiple Choice

You work for a securities firm matching orders to buy and sell stocks in small companies. A customer places an order to buy 100 shares of X Corp. when they sell for $40 a share. You find a seller at $39 per share. May you buy the shares yourself at $39 and then sell them for $40 to you client?

• A) yes, there is no legal or ethical constraint on this since the order was $40 per share
• B) so long as you regard this as ethical, there is no legal constraint since the order was $40 per share
• C) the SEC places no constraint on this, but in equity the law would require you to sell to your client at $39
• D) no, specialists cannot deal for their own benefit
• E) none of the other choices

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