Product-Specific Disclosures: Options Communications
Chapters in this video
- 0:00 The ODD as the dividing line for all options communications
- 1:35 Account approval trigger and electronic delivery of the ODD
- 3:02 Pre-ODD danger zone: 10 calendar days and ROP approval
- 4:31 Permitted and prohibited content before ODD delivery
- 5:26 Post-ODD VIP lounge: standard rules and fair-and-balanced requirements
- 6:44 Projections, annualized returns, and the 60-day rule
- 7:30 Before-and-after comparison master cheat sheet
- 8:07 Rapid-fire exam recap
What this video covers
- When the Options Disclosure Document (ODD) must be delivered: at or before account approval for options trading, not at the first transaction
- Why a hyperlink to the ODD satisfies the delivery requirement, and when ODD supplements must reach the customer
- The 10-calendar-day (not business-day) FINRA pre-use filing rule for retail options communications sent before ODD delivery
- Who must approve retail options communications in advance: the Registered Options Principal (ROP), with the one exception of completed worksheets
- The three things permitted in pre-ODD communications, and the four things absolutely prohibited (recommendations, performance figures, specific security names, and more)
- How post-ODD communications revert to standard content rules, including the requirement for risk statements of equal specificity alongside any opportunity claim
- The 60-day minimum experience rule for annualized returns in projections, and the four conditions any projection must meet
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