Glossary – Letter K

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Know Your Client (KYC)

This is an industry standard that is followed by investment dealers. It simply means recommending trades that are suitable to a client. A reputable investment representative will only recommend securities that fit the client’s investment personality, risk tolerance, financial situation and goals.

Note: Online/discount brokers initially were required to adhere to the KYC standard, but they no longer are legally required to do so.