SIE FINAL review

Question 1

callable preferred

Answer 1

the company buys buck from investors when interest rates go down

Question 2

convertible preferred

Answer 2

investor converts shares to fixed number of common shares

Question 3

adjustable rate preferred

Answer 3

usually tied to rates such as treasury bills and money market rates

Question 4

restricted non insider

Answer 4

6 month

no volume restrictions

Question 5

restricted insider

Answer 5

6 month

volume restrictions

Question 6

control stock held by insider

Answer 6

no hold

volume always applies

Question 7

american depository receipts

Answer 7

created when common shares are purchased in the forign country. Shares are purchased in us dollars. subject to withholding tax in home country
pay dividends in us dollars

Question 8

bond prices have what relationship with interest rates

Answer 8

inverse

Question 9

call feature

Answer 9

issuer to call in bond when interest rates are falling .

Question 10

put feature

Answer 10

always investor to put back bond when interest rates are rising

Question 11

convertible feature

Answer 11

allows investor to convert the bond into shares of common stock

Question 12

Treasury bills

Answer 12

issued with maturities of 4,13,26,52
pay NO interest
issued at discount and redeemed at par

Question 13

Treasury notes

Answer 13

2-10 years
semiannual interest
stated par value and mature at par value

Question 14

Treasury bonds

Answer 14

10-30 years
semiannual interest
stated par value and mature at par value

Question 15

Treasury reciepts

Answer 15

BDs buy treasury securites and place them in a trust at a bank and sell separate receipts against the principal and coupon payments

Question 16

treasury stripes are or are not backed in full by the us gov

Answer 16

they are

Question 17

government national mortgage assocation are the only

Answer 17

agency securities backed by the full faith and credit of the Federal government

Question 18

debentures

Answer 18

debt obligation of the corporation backed only by its word and general creditworthiness.

Question 19

guarenteed bonds

Answer 19

backed by a company other than the issuing corporation such as a part company.

these are unsecured even though they say guarenteed

Question 20

GO bonds

Answer 20

for capital improvments that benefit the entire community.

Question 21

some municipal issues are taxable like

Answer 21

build america bonds

Question 22

negotiable certificate of deposit

Answer 22

some can be traded in secondary market known as negotiable cds. no physcial asset backed, only by full faith and credit.

Question 23

bankers acceptance

Answer 23

short term time draft with a specified payment date drawn on bank usually between 1-270 days

Question 24

comerical paper maturity rainge

Answer 24

also 1-270 days

Question 25

repurchase agreement

Answer 25

bank sells some securities and buys bank later at higher price

Question 26

reverse repo

Answer 26

dealer BUYS securities and sells them back later at higher price

Question 27

closed end companies may issue

Answer 27

common, preferred, and debt securities.

Question 28

open end companies issue

Answer 28

only common stock

Question 29

mutual funds are ____

Answer 29

redeemable securities

Question 30

class c shares for investors with _____time horizons

Answer 30

short

Question 31

tax deductions for

Answer 31

mortgage expense and depreciation allowances

Question 32

tax credits for

Answer 32

government assisted housing

Question 33

hedge funds are known as

Answer 33

private investment companies

Question 34

exchange traded notes

Answer 34

senior unsecured debt securities issued bt a bank or financial institution.

Question 35

gtc automatically cancled if unexecuted by

Answer 35

last business day of april or october

Question 36

fill or kill executed

Answer 36

immediately

Question 37

all or none order executed

Answer 37

not immediately

Question 38

agent=

Answer 38

broker=commission

Question 39

principal=

Answer 39

dealer=markup or markdown

Question 40

regular way=

Answer 40

t+2

Question 41

declaration date record and payment deteremined by ex dividend determined by

Answer 41

BOD Finra

Question 42

to open margin account you need

Answer 42

credit agreement hypothitication no loan consent

Question 43

cordavel contributions up to contributions can or cannot be limited for high income tax payers

Answer 43

2000 per year can

Question 44

six year records

Answer 44

blotters ledgers records

Question 45

3 year records

Answer 45

u4 u5 ads trial balances cistomer confirmations

Question 46

liftime records

Answer 46

minute bookds | stock certificates

Question 47

customer complaints held for

Answer 47

4 years

Question 48

sipc coverage

Answer 48

no more than 500,000 per separate customer, sipc coverage only 250,000 in cash

Question 49

FDIC

Answer 49

insures deposits

Question 50

accredited investor

Answer 50

has 200,000 or 300,000 joint annual

Question 51

carrying firm

Answer 51

(clearing firm) carries customer accounts and accepts funds and securities from customers

Question 52

fully disclosed firm

Answer 52

also known as introducing firm introduces customers to a clearing firm

Question 53

a introducing firm recieves customer checks but

Answer 53

they must be made out to clearing firm

Question 54

fed funds rate

Answer 54

rate that comerical banks borrow from each other

Question 55

discount rate

Answer 55

rate that the federal government loans to member banks

Question 56

leading indicators act as coincident lagging

Answer 56

predictors confirm where it is confirmation for new trend

Question 57

keyesian theory

Answer 57

beleives government involvement is good

Question 58

primary offering

Answer 58

proceeds go to the issuing corporation

Question 59

secondary offering

Answer 59

all or more stockholders in a corporation are selling all or a major portion of their holdings to the public .

Question 60

coordination

Answer 60

issuer files with state and sec at same time

Question 61

qualification

Answer 61

must be anything state requires

Question 62

notice filing

Answer 62

potential fee

Question 63

firm element

Answer 63

requires members to prepare an annual training

Question 64

regulatory element

Answer 64

computer based training within 120 days of persons second registration and then every 3 years therafter.

Question 65

private business transactions also known as

Answer 65

selling away

Question 66

As an investment vehicle, and regarding the tax consequences, REITS are organized as

Answer 66

trusts

Question 67

The Advisers Act of 1940 specifically deters gaining political favor via contributions made to candidates, officials, or political parties. As such, if a political contribution is made to any of these entities then under the Act, the firm may NOT provide advisory services to any government these individuals or parties represent for how long?

Answer 67

2 years

Question 68

warrants or rights can be purchased on margin

Answer 68

warrents can and rights may not

Question 69

Which of the following is a debt instrument that pays no periodic interest?

Answer 69

treasury strip