you must always consider the suitability of the client's investment action and match this to the needs of the particular client in order to determine the suitability of the investment.

If a new client is obtained or an existing client's previous investment matures, you need not immediately obtain client information if he or she first re-invests these funds in cash equivalents.

You will then obtain the client's investment preferences. You will need to determine from the client the level of risk that the client is prepared to accept (in other words, the client's risk tolerance level). This needs to be ascertained before any investment action is taken.


You are required to:

• Know the type and nature of your clients'.
• Know the return objectives and risk tolerance of your clients.
• Know the liquidity needs, expected cash flows, investable funds, time horizon, tax considerations, regulatory and legal circumstances, and other constraints of your clients.

You are NOT required to change an existing client portfolio as soon as it comes under your discretion; it is best to take a bit of time, plan and implement actions in an organized way.