Registered Options Principal (ROP)

What Is a Registered Options Principal (ROP)?

In the financial sector, a Registered Options Principal (ROP) is a professional who has passed the Series 4 exam and is subsequently qualified to regulate options trading activities at a financial firm. ROPs are many times senior employees at brokerage firms, responsible for managing the firm's options exposure and the options portfolios in client accounts.

Figuring out Registered Options Principals (ROPs)

People wishing to become ROPs must initially pass the Registered Options Principal Qualification Examination, better known as the Series 4 exam. This test, which is administered by the Financial Industry Regulatory Authority (FINRA), comprises of 125 various decision inquiries notwithstanding 10 unscored pre-test questions. Its items are centered around the supervisory obligations expected to guarantee that all options trading activities consent to applicable financial regulations.

ROPs are prepared to regulate the trading of options in light of different types of underlying assets, including those in view of stocks, foreign currencies, interest rates, stock indexes, or different derivative products. Given the wide assortment of products required, as well as their complexity, firms will frequently utilize various ROPs. Now and again, one person is designated as the principal while one more is designated as the alternate ROP. These positions are frequently held for senior individuals from the firm, like its partners, officers, or directors.

As well as passing the Series 4 securities license course, up-and-comers wishing to get the ROP assignment must likewise pass no less than one of the accompanying essential exams: the Series 7 and the Securities Industry Essentials exam, which are administered by FINRA.

Real World Example of a ROP

In the United States, the Series 4 exam centers around six subject areas connecting with different parts of the ROP's professional obligations. These incorporate the compliance requirements connected with new options-trading accounts, the risk management associated with clients' options trading, the supervision of different employees associated with the options-trading process, and the conventions engaged with imparting around real or potential options trades.

In Canada, prospective ROPs must complete the Options Supervisors Course (OPSC), which is given by the Canadian Securities Institute. This course covers comparable subject matter as FINRA's Series 4 exam, however it is tailored to all the more closely mirror the Canadian capital markets.

Features

• A Registered Options Principal (ROP) is a professional assignment in the financial industry.
• In the United States, ROP applicants must finish the Series 4 exam administered by FINRA; while in Canada, up-and-comers must pass the Canadian Securities Institute's Options Supervisors Course (OPSC).
• It qualifies the holder to manage options trading activities.