Principals and Registered Representatives
FINRA identifies several categories of principal, depending on the type of activities being supervised. A General Securities Principal (Series 24) is a person engaged in managing or supervising registered employees with respect to all activities of her office, except those involving options accounts or financial reporting to regulators. A General Securities Principal may also approve advertising and sales literature, including communications regarding municipal securities. General Principals include sole proprietors, officers, partners, managers, and directors of corporations. Limited Principals are those who supervise specific activities, such as financial reporting, options, and futures sales, municipal securities sales, and the sale of investment company securities (Series 26).
Note that a General Securities Principal (Series 24) is qualified to function as an Investment Company and Variable Contracts Products Principal without taking the Series 26 exam.
Registered representatives, too, come in several categories. A General Securities Representative (Series 7) may solicit or sell any type of security and may advise and make recommendations to customers who are not registered representatives.
The activities of Limited Representatives are more restrictive. For example, the Investment Company and Variable Contracts Representative (Series 6) exam permits the sale of investment company products such as annuities, variable life insurance, and mutual funds. Other Limited Representatives are allowed to sell options, corporate securities, or government securities, or to facilitate the raising of investment capital.
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Which Principal Is Permitted to Do Which Securities Tasks? |
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General Securities Principal |
Investment Company Products and Variable Contracts Limited Prin | |