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My SIE Exam > Part 1 units 1-6 (33Q's) products > Flashcards

Part 1 units 1-6 (33Q's) products Flashcards

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SIE Exam flashcards
1
Q

howey test

A
  1. investment of money made into
  2. common enterprise
  3. with expectation of profit
  4. 3rd party efforts
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2
Q

common stock

A
  • issued to raise capital

- provides investors growth

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3
Q

Preferred stock

A
  • no voting rights
  • income
  • priority over common
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4
Q

straight (noncumulative)

A
  • Preferred stock

- Missed dividends?? oh well

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5
Q

Cumulative preferred stock

A
  • missed dividends pay out

- pay out before common

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6
Q

Callable preferred

A
  • preferred stock
  • ISSUER may buy back shares AFTER specified date at a specified price
  • let company replace high fixed dividend with lower one
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7
Q

Dividend disbursement dates

A

DERP

  • Declaration Date
  • Exdividend date = Ex-date
  • Record Date
  • Payable Date
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8
Q

Declaration Date

A
  • BOD approves dividend payment

- BOD assign payment and record dates

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9
Q

Ex-dividend date = Ex-date
assigned by who?
how many days before record date?

A
  • Assigned by FINRA or exchange

- One business day

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10
Q

Record date

A
  • those who own the stock on this date go on record

- Must purchase stock 2 days before this

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11
Q

Payable day

A
  • Dividends sent out to owners on record
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12
Q

Rights of commonstock holders

A
  • Voting rights
  • Transfer ownership
  • Books and records
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13
Q

Statutory voting rights

A

whatever amount of shares you have, that’s the maximum amount of votes you can place per issue/chair

example 100 shares, 3 chairs.
maximum 100 votes per chair

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14
Q

Cumulative voting rights

A
  • take your shares
  • multiply by number of chairs
  • that number = amount of votes you have
  • can split those votes up however you want

example
100 shares. 3 chairs. 300 votes
1. 200 2. 50 3. 50
or 1. 300 2. 0 3. 0

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15
Q

Rights or preemptive rights

A
  • Give current stockholders chance to maintain percentage of ownership
  • exercise price below CMV
  • Short term
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16
Q

Warrants

A
  • long term
  • exercise price above market (future price)
  • attached to bond offering
    (give lower interest rates out)
  • exercise, sell or expire
17
Q

Rule 144

A

Regulate the sales of Control securities (people who have CONTROL over company)
-can be directors or officers

18
Q

Restricted stock = unregistered

A

-Acquired from somewhere other than a registered public offering

19
Q

Rule 144 for
Restricted stock (unregistered) +
held by nonaffiliate (non insider)

A
  • 6 month hold

- No volume restriction

20
Q

Rule 144 for
Restricted stock (unregistered) +
Held by an affiliate (insider)

A
  • 6 month hold

- volume limit = greater of 1% of outstanding or average weekly trading volume from past 4 weeks

21
Q

Rule 144 for control stock (registered) + held by affiliate (insider)

A
  • no hold

- volume limit = greater of 1% of outstanding or average weekly trading volume from past 4 weeks

22
Q

ADR

American depository receipts

A
  • simplify foreign investing
  • issued by US by a depository bank
  • these are US securities
  • depositary bank is registered owner of foreign shares
23
Q

ADR dividends are how much?

A

whatever’s leftover after foreign withholding tax

24
Q

ADR’s have voting rights? or preemptive rights?

A

generally no

25
Q

Preferred stock par value?

A

$100

26
Q

Risk of dividends

A
  • purchasing power
  • interest rate risk
  • not guaranteed
  • dissolution priority
27
Q

Convertible preferred

A

exchange the shares for fixed number of common shares

28
Q

Convertible preferred issue with a higher or lower dividend rate?

A

Lower

29
Q

Adjustable-rate preferred

A
  • dividends vary with interest rates

- if interest rates high so is dividend rate

30
Q

Participating preferred

A

-company make more money, you get more money

example
preferred stock XYZ 6% participating to 9%. If BOD says we did good and wants to reward share holders then you get extra 3% of dividends

31
Q

Par value of bond?

One point = ?

A

$1000

$10

32
Q

Term maturity?

A

Principal aka issue paid on one date

33
Q

Serial maturity

A

prinicipal or issue paid over period of years

34
Q

Balloon maturity?

A

Combo of term and serial

bulk paid at the final maturity date

35
Q

Nominal, stated coupon

A

annual interest

36
Q

Current yield

A

annual interest/CMV

example
$80/$1100 = 7.3%

37
Q

yield to maturity

A

how much money was made if this bond fully matures.

ie interest plus gain if bought on discount, or interest - loss if bought on premium

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