Series 7 Exam Question 141: Answer and Explanation

Question: 141

Matching orders is

• A. combining fully paid and margined securities for use as collateral
• B. the illegal manipulation of a security
• C. bringing in a third party to execute a trade
• D. buying securities with no intention of paying for the trade

Correct Answer: B

Explanation:

B. Matching orders is the trading of securities back and forth between two entities without really changing ownership. Matching orders is the illegal manipulation of a security because it makes investors believe there's a larger amount of trading on a particular security than there really is.