Final answer:
Financial institutions carry out qualitative, quantitative, and mandatory regulatory tests to determine if a client can be classified as an elective professional client. These involve assessments of client experience, knowledge, trading volume, and compliance with regulations. All the given options are correct.
Step-by-step explanation:
The question refers to the classification of clients in a financial services context, specifically for treatment as an elective professional client. When determining if a client can be categorized as an elective professional client, financial institutions must carry out certain tests. These are often divided into qualitative and quantitative assessments, as well as considering mandatory regulatory criteria.
Qualitative tests may involve assessing the client's experience and knowledge in the investment field, understanding their ability to make their own investment decisions and the risks involved. Quantitative tests could include criteria such as the volume of trades, the size of the investment portfolio, or financial instrument transactions the client is involved with. Certain mandatory regulatory requirements must also be met, ensuring compliance with all necessary rules and standards for professional client classification.