Other Federal Regulations

Question 1

“Intrastate offerings” are exempt transactions under the Securities Act of 1933 under the provisions of what rule?

Answer 1

Rule 147 - Intrastate Offerings

Question 2

For a sale of securities to be exempt under Regulation D under the Securities Act of 1933, there must be no more than ____ accredited investors

Answer 2

35

Question 3

To claim a private placement exemption the issuer must file a _______ with ______ no later than _____ after the _____ to claim the exemption

Answer 3

Form D; with the SEC; no later than 15 days after the sale date

Question 4

What is Regulation A?

Answer 4

an “E-Z” registration process under the Securities Act of 1933 that permits a non-exempt issuer to issue up to $50,000,000 worth of securities each year. The intent is to make it simpler for start-up companies to raise capital.

Question 5

Under the Securities Exchange Act of 1934, the SEC can suspend trading in the securities markets if it gives prior notice to the:

Answer 5

President of the United States

Question 6

A securities firm that stands ready to buy and sell a security for its own account is a(n):

Answer 6

Market Maker (which is also a principal)

Question 7

What is a Securities Information Processor (SIP)?

Answer 7

ecurities information processors (SIPs) collect and disseminate prices for non-exempt securities.

Question 8

What are some examples of SIP’s?

Answer 8

NYSE TRF
NASDAQ TRF
Pink Sheets

Question 9

If a 13D filing is required, notice must be filed with the Securities and Exchange Commission within:

Answer 9

10 business days

Question 10

What is Form 13F for?

Answer 10

A report filed with the SEC by investment managers who exercise discretion over the accounts of customers who collectively hold $100,000,000 or more of equity securities

Question 11

When and how frequently must a Form 13F be filed?

Answer 11

The 13F must be filed within 45 days of the quarter ending where the $100,000,000 dollar limit was reached.

Question 12

What securities are marginable?

Answer 12

NYSE, AMEX (NYSE-MKT) and NASDAQ listed issues are marginable. Futures are also marginable

Question 13

Can you purchase options on margin?

Answer 13

No, full payment is required because these have a maximum life of 9 months.

Question 14

Are mutual funds available for purchase on margin?

Answer 14

No

Question 15

What Act regulates the registration of new (primary) issues?

Answer 15

The Securities Act of 1933

Question 16

The Investment Company Act of 1940 requires the registration of:

Answer 16

• Management Companies
• Face amount certificate co’s
• UIT’s

Question 17

Management companies are prohibited from:

Answer 17

• buying sec. on margin
• selling sec. short
• lending money to shareholder

Question 18

Under the Investment Company Act of 1940, an affiliated person is prohibited from doing what 3 activities?

Answer 18

• Borrowing money from the fund
• Borrowing securities from the fund
• Selling securities personally to the fund

Question 19

Under the Investment Company Act of 1940, what percentage of a management company’s Board of Directors MUST be unaffiliated with the investment company?

Answer 19

40%

Question 20

Under the Investment Company Act of 1940, an investment adviser’s contract is initially set for:

Answer 20

2 years; and is subject to renewal every year thereafter, either by the BOD of the Fund; or a majority vote of the outstanding shares

Question 21

What price is used for purchase prices and redemption computations of a mutual fund?

Answer 21

That day’s closing price is the basis for fund purchase price and redemption computations

Question 22

SEC Rule 12b-1 allows open-end investment companies to charge an annual fee for soliciting new investment into the fund against:

Answer 22

total NET assets of the fund

Question 23

What is the difference between Class A and Class B stock in a pooled investment vehicle?

Answer 23

Class A stock offers breakpoints while Class B stock does not