SIE (Securities Industry Essentials) Practice Exam

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What role does a CCO play in a broker-dealer firm?

Monitoring market trends to advise on stock purchases
Handling customer complaints and disputes
Monitoring the firm's adherence to SRO, State, and Federal laws and regulations
Overseeing the daily trading activities on the stock exchange floor

The correct answer is: Monitoring the firm's adherence to SRO, State, and Federal laws and regulations

A CCO, or Chief Compliance Officer, plays a crucial role in ensuring that a broker-dealer firm follows all applicable laws and regulations. This includes not only monitoring the firm's compliance with SRO, State, and Federal laws, but also implementing policies and procedures to ensure ongoing adherence. Options A, B, and D are incorrect because they describe responsibilities that are not typically handled by a CCO. While monitoring market trends and handling customer complaints are important tasks within a brokerage firm, they are not the primary responsibility of the CCO. Additionally, overseeing daily trading activities on the stock exchange floor is typically the responsibility of the firm's traders and floor managers, not the CCO. Therefore, option C is the correct answer.