Series 7: 14.3.3.1 Discretionary Accounts

14.3.3.1  Discretionary Accounts

A discretionary account is one in which the customer authorizes her financial advisor to place trades in her account without seeking permission prior to every order. Without discretionary authority, a broker must receive three pieces of information from the customer before it can make a transaction in the customer’s account:

1. 1. The name of the security
2. 2. Whether to buy or sell
3. 3. The amount of the security to be transacted

A discretionary account