General Securities Sales Supervisor (Series 10) Practice Exam 2026 - Free Series 10 Practice Questions and Study Guide

The rationale for why variable annuity salesmen must be registered with FINRA is based on the nature of the products they sell and the regulatory environment surrounding those financial instruments. Variable annuities are considered securities because they involve an investment component and the potential for capital appreciation, combined with an insurance component, which offers features such as death benefits or guaranteed payments. Because they are classified as securities, individuals selling variable annuities are required to be registered with FINRA to ensure they adhere to industry standards, ethical practices, and regulatory requirements.

In contrast, the other options represent individuals or roles that might not fall under FINRA's regulatory requirements in the same manner. Commodity salesmen, for instance, primarily deal with commodities and are often regulated by the Commodity Futures Trading Commission (CFTC), not FINRA. Likewise, Designated Market Makers (DMMs) on recognized stock exchanges are primarily regulated by the exchanges themselves, and while they have certain regulatory requirements, they do not need to be registered with FINRA in the same way. Government securities traders typically operate under different regulatory guidelines that may not necessitate registration with FINRA.

Thus, financial professionals dealing specifically with variable annuities must navigate the securities landscape through relevant FINRA registration to ensure compliance