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Series 65 > Missed Topics > Flashcards

Missed Topics Flashcards

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Series 65 flashcards
1
Q

What theory says that economic growth results from lower taxes and reduced government spending?

A

Supply side theory

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2
Q

In a general partnership, what must occur with any changes to the partnership?

A

Clients must be informed in a reasonable amount of time

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3
Q

Of a broker dealer and investment advisor, how are they each registered with the SEC?

A

BD is under the securities exchange act of 1934
IA is under the IA act of 1940

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4
Q

What is not allowed in terms of compensation for an IA?

A

Performance-based

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5
Q

What is the maximum number of bitcoin?

A

21 million coins

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6
Q

In options, who has right and who has obligations?

A

Sellers (long, own) have rights.
Buyers (short, need) have obligations

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7
Q

(T/F) An investment advisor must register with the SEC if he acts as an IA to a company register under the investment advisors act if 1934.

A

False. Investment advisors act of 1940

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8
Q

Who does the ADV brochure cover?

A

Anyone that determines general investment advice to clients

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9
Q

Where can derivatives be sold?

A

Listed exchanges (not OTC)

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10
Q

What does SPAC stand for?

A

Special purpose acquisition company

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11
Q

What does a leveraged inverse ETF do?

A

It multiplies the effect of an inverse EFT by 2-3x (goes up when the market goes down, at a greater pace)

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12
Q

What kind of minimum net worth must a IAR have?

A

None. The net worth minimums are on the IA

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13
Q

If a client orders the purchase of shares before 4pm, what is the price basis used?

A

It is the forward price rule. 4pm is the cutoff. Shares are based off the public offering price (POP)

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14
Q

Beta is a representation of which kind of risk?

A

Systematic

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15
Q

What kind of P/E ratio and dividend would you expect from growth and value stocks

A

Growth: High P/E low div
Value: low P/E high div

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16
Q

What is form ADV-E, who fills it out and who submits it?

A

ADV-E is the surprise inspection form for those who hold custody over client funds. The IA fills out the form, but the independent accountant submits the form.

17
Q

What type of risk is common to all fixed income securities?

A

Interest rate

18
Q

What are exchange traded notes?

A

Unsecured debt issued by banks, not insured by FDIC.

19
Q

What is commercial paper?

A

Unsecured debt obligations of corporations needing short-term financing. Not registered, negotiated terms, backed by money-market deposits.

20
Q

T/F A key component of hiring a solicitor is to ensure that they are not statutorily disqualified from registration

A

True - ensure against bad actors

21
Q

What, in distributed net income (DNI), is not included as part of the calculation?

A

Reinvested capital gains

22
Q

What does the Financial Crimes Enforcement Network (FinCEN) do?

A

Responsible for the bank secrecy act administration

23
Q

T/F Investment Advisor Representatives are not excluded from the USA definition of investment advisor.

A

False

24
Q

How is the bond conversion ratio determined?

A

Divide bond par by the price per share to convert

25
Q

Rule 144 is…

A

The rule that sets the requirements for selling or buying restricted stock

26
Q

What are the volume limitations for restricted stock?

A

1 year for control and non-affiliate persons

27
Q

What is “full time” for the purposes of a keogh plan?

A

1000 hours

28
Q

What is key to note about dividends and treasury STRIPS?

A

They are in essence, zero coupon bonds.

29
Q

What is SOFR?

A

Secured overnight financing rate. Short term borrowing

30
Q

What is core CPI?

A

CPI, minus energy and food prices

31
Q

When a bond is sold mid-coupon distribution, what does the buyer and seller get or pay?

A

Buyer pays par plus accumulated interest
Seller is paid par plus accumulated interest

32
Q

What is generally happening to the economy cycle if the yield spread is widening between corporate and government bonds?

A

Economic slowdown

33
Q

What is
-Pegging
-Front running
-matched orders

A

Pegging: buying stock to support its price
Front running: buy ahead of an institutional purchase
Matched order: buying and seeking of the same stock to give the appearance of trading volume

All illegal

34
Q

Standardized equity options are issued and guaranteed by:

A

The options clearing corporation (OCC)

35
Q

When might a price continue to fall and provide an opportunity to sell a stock short? (Below or above the support or resistance level)

A

When the stock falls below the support level

36
Q

What clients are exempt from receiving a ADV brochure?

A

Registered investment companies, both open and closed, and impersonal advice costing less than $500 per year

Series 65 (2 decks)

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