The Securities Investor Protection Corporation (SIPC) protects customers if a broker-dealer fails due to insolvency. Coverage applies to cash and securities in customer accounts, up to $500,000total, including $250,000 for cash.
A is correctbecause SIPC’s purpose is to protect against losses arising from a broker-dealer’s insolvency.
Bis incorrect because SIPC does not guarantee investment performance.
Cis incorrect because SIPC does not cover market losses.
Dis incorrect because futures contracts are not covered under SIPC.
[Reference:Securities Investor Protection Act of 1970; SIPC FAQs, ]
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