Study how Series 9 tests complaints, trade errors, daily options activity review, position limits, prohibited practices, and options trade operations.
Function 2 is the operational and conduct-heavy center of Series 9. Once the account is open, the options principal has to supervise complaints, trade errors, daily order and execution activity, position and exercise limits, prohibited practices, and the post-trade mechanics of assignments, exercises, corporate actions, and settlement. This is where options supervision becomes very concrete.
Read this chapter as the activity-review function. Start with customer complaints and regulatory escalation, then move into trade-error correction, daily trade surveillance, and the operational process behind exercises, assignments, and settlement.
| Section | Focus |
|---|---|
| 2.1 Customer Complaints and Regulatory Escalation | Complaint classification, records, reportable events, investigation files, root-cause review, and remediation. |
| 2.2 Options Trade Errors, Cancellations, and Rebills | Error accounts, cancel-and-rebill controls, obvious-error escalation, customer communication, metrics, and post-correction review. |
| 2.3 Daily Trade Surveillance, Limits, and Prohibited Activity | Order review, origin codes, best execution, position/exercise limits, reporting, manipulation indicators, and escalation playbooks. |
| 2.4 Options Operations, Exercise/Assignment, and Settlement | Exercise notices, OCC assignment, allocation methods, corporate-action adjustments, settlement, outages, and audit trails. |
| Skill | Exam use |
|---|---|
| Classify options activity exceptions | Separate customer complaint, trade error, limit, and prohibited-practice facts quickly. |
| Apply the right supervision response | Choose hold, review, escalate, correct, or document based on the exception. |
| Connect trading mechanics to risk | Recognize how exercise, assignment, settlement, and corporate actions affect supervisory decisions. |
| Avoid process shortcuts | Reject answers that let questionable activity continue without review, records, or escalation. |