Q&A3 Flashcards
Deposits of currency exceeding $__ in a single day must be reported to [who] using [what].
The practice of depositing amounts under the reporting threshold is called ____. Amounts must be aggregated when reporting (so report all).
$10k…Tsy Dept…CTR
structuring
Penny stocks
BDs must disclose amt of comp that __ and __ will receive for a penny stock trade.
BD and RR
A revolving subordinated loan allows ___ to be made w/in first yr, with ___ approval.
prepayments…DEA
Bids for NMS stock
> $1: min increments of $__
< $1: min increments of $__
> $1: min $.01
< $1: min $.0001
Quiet periods
Two types after effective date of a mgd or co-mgd offering:
- ___ cal days for IPOs; applies to ___
- ___ cal days for secondaries; applies to ___
- 10 cal days for IPOs; applies to all distribution participants
- 3 cal days for secondaries; applies to mgrs/co-mgrs only
Short interest reports must be filed with FINRA __ times each month by close of biz on the __ day after calculation.
twice…second
U5 / RR departures
Firm must provide RR a copy of U5 w/in __ days of departure.
Firm must file updates if answers to certain disciplinary questions on the U5 change w/in __ days following termination.
30 days
30 days
Counterfeit securities
If a principal discovers firm holds, must file report w/in [how long?] with [whom?].
w/in 1 day of discovery with issuer agent, FBI, SEC
Research disclosures
1. When issuing a research report, firm must indicate if it was a mgr / co-mgr of ANY underwriting of company’s debt or equity w/in preceding _____.
12 months
How soon are the following marginable?
- ETFs
- Mutual funds
- immediately
2. after 30 days
A block trade is generally defined as ___ or more shares, OR a trade having mkt value of $___ or more.
10k shares OR $200k
Aged fail
Is a fail to deliver that has been outstanding for __ biz days or longer.
BD must deduct from its ___ a % of aged fails.
5 biz days
deduct from its net capital
Taping Rule
- Applies to firms w/ at least __ RRs where __% or more have been employed by disciplined firms.
- If a firm terminates RRs to avoid being subject to the Taping Rule, it may not rehire those same staff w/in ____ or it will be subject to the rule.
- 20 RRs where 20% or more…
2. 180 days
A market maker is alone at inside market quoting Nasdaq stock at:
28.25 - 28.50, 10 x 50
It then receives two customer limit orders: one to buy 400 shares at 28.25, one to sell 500 shares at 28.50.
What is its quote after receiving the orders and treating them according to the SEC Display Rule?
28.25 - 28.50, 14 x 50
If MM is at inside and accepts customer limit order at inside, it must change its size to reflect customer’s interest UNLESS order is de minimis (10% or less of MM’s size).
Here, 400 shares > 10% of MM bid size. So that must increase to 14.
500 shares = 10% of MM offer size. So that may remain at 50.
Rule 144
The amount of restricted securities that may be sold w/in a 3-month period is the GREATER of:
__% of the shares outstanding, or
__ for the previous 4 weeks
1% or avg weekly volume for previous 4 weeks
Portfolio margining
Client must be approved for ___.
Eligible:
NOT eligible:
uncovered writing
Eligible:
- margin equities (incl ETFs)
- listed options (incl LEAPS)
- futures
- unlisted derivs
- warrants
- index warrants
NOT eligible:
- rights
- corp debt
Tender offers
- Schedule TO filed by ___ to provide terms of tx and other req’d info to shareholders.
- Schedule TO filed by ___ to repurchase any FI securities.
- Proxy statement filed if shareholders would be ___ on the MnA tax.
- acquirer
- issuer
- issuer
Pattern day trader
- Is any customer who day-trades __ or more times w/in a __-biz-day period.
- The min equity req’d for a pattern day trader is $__.
- Buying power in a pattern day trader’s margin account = __x the maintenance margin excess.
Ex: What is the day-trading buying power of an account that has a long MV of $170k and debit balance of $90k? - If buying power exceeded, must meet a day-trading margin call w/in __ biz days.
- While margin call outstanding, buying power restricted to __x maintenance margin excess.
- 4 or more times in a 5-business-day period
- $25k
- 4x
Ex: SRO maintenance req = 25% of LMV ($170k) = $42.5k. So excess maintenance req = $80k - $42.5k = $37.5k. So buying power = 4 x $37.5k = $150k. - w/in 5 biz days
- 2x
In connection with an underwriting, if a member will be imposing a ___ or engaging in ___, it must notify FINRA for BOTH Nasdaq and OTC equity securities.
imposing a penalty bid or engaging in syndicate covering transactions
IRA RMDs
First distribution must be made by ___ in the year AFTER the client reaches age ___.
For subsequent years, RMD must be taken by ___.
April 1…70 1/2
Dec 31
Arbitration
A member must provide a customer a copy of a signed predispute arbitration clause w/in __ days of a request or __ days of the signing, whichever is earlier.
10 biz days of a request or 30 days of the signing
Reg D
- A ___ is a person who represents potential nonaccredited purchasers solicited to buy securities under Reg D.
- Only offerings exceeding $__ specify need for investor sophistication or use of such a person.
- purchaser representative
2. $5mm
Ineligible issuers
- Defined as such if filed for bankruptcy w/in past ___ years.
- Ineligibility terminates if issuer files a registration stmt or annual report that includes ___.
- Issuer could then conduct what type(s) of underwriting?
- 3 years
- audited financial statements
- best-efforts or firm-commitment
DNC lists
Requests to be placed on DNC list must be honored w/in ___ days.
30 days
SRO maintenance req
Standard req:
- __% on long positions
- __% on short positions
For leveraged ETFs:
- Multiply the __ by the standard req
- Ex: SRO maintenance req on a $1mm purchase of a 2x Long Gold Index ETF = $__.
- 25% on long positions
- 30% on short positions
- leverage factor
- $500k (2 x 25% x $1mm)
Blockbuster trade
- Defined as a trade of $__ or more to be executed through a BD’s clearing firm.
- BD given how long to accept / decline?
- $1mm
2. 15 mins
