Sales Supervision and Practices

The second Series 26 chapter is the main sales-practice function. It tests how the principal supervises recommendations, communications, compensation, outside activities, and associated-person conduct in an investment-company and variable-contracts business. This chapter carries much of the exam’s practical judgment because it forces candidates to connect product-specific supervision with broad FINRA sales-practice rules.

Read this chapter as the front-line supervisory layer. Start with basic supervision and standards of conduct, then move through communications, recommendations and disclosures, compensation restrictions, and the personal-activity and conduct issues that can create conflicts or firm exposure.

In this section

• Sales Supervision, Standards, and Conflicts
  Review the core supervision, conduct, conflict-management, and personal-trading rules tested in Series 26 sales-practice questions.
• Communications With the Public
  Learn how Series 26 supervises retail communications, correspondence, telemarketing, public appearances, and product-related sales literature.
• Recommendations, Disclosures, and Account Handling
  Review suitability, account-opening, disclosure-delivery, and account-handling rules for mutual funds and variable products on Series 26.
• Cash and Non-Cash Compensation
  Learn the compensation, gifts, training-meeting, referral, and networking limits that Series 26 tests for packaged-products supervision.
• Outside Activities, Personal Finance, and Associated-Person Conduct
  Review OBA, private-securities, borrowing, personal-account, insider-trading, and disciplinary issues tested in the final sales-practice sections of Series 26.