SIE need to work on Flashcards
restricted stock is registered or unregistered
unregistered
control stock is registered or unregistered
registered
Restricted stock held by a nonaffiliate
6 month hold sell freely thereafter
nonaffilliate means
non insider
restricted stock held by afilliate
6 month hold
volume limits thereafter
control stock held by affiliate
no hold
volume limits always apply
affiliate means
insider
penny stock
unlisted security trading at less than $5 per share
nominal yield
coupon, nominal, or stated yield is set at the time of issue. Coupon is fixed percentage of bonds par value
current yield
measures a bond’s annual coupon payment(interest) relative to its market price
yield to maturity
reflects annualized return if bond is held to maturity.
yield to call
some bonds are issued with what is known as a call feature. A bond with a call feature may be redeemed before maturity at the issuers option.
draw cy ym and ytc
pre cy ytm ytc
par
did triange coupon
If a potential bond issue is up for competitive bids how long is the waiting time
no waiting period
If it is a negotiated bid how long is the waiting period
this is non-competitive and it is 2 years
private investment companies are or are not investment companies
are not
Associated persons whose activities are limited solely to sales or have only clerical or ministerial functions would
not be considered a municipal financial professional
For ETFs, the phrase “tax efficiency” can best be described by which of the following concepts?
Usually, for ETFs, there are no tax consequences for investors until the shares are sold.
Broker/dealers who reserve the right to disclose nonpublic private information about their customers to unaffiliated third parties must
provide notice to customers at the time of the account opening and provide reasonable means for customers to opt out of such disclosures
An investor who has a short position in 500 shares of JKH common stock would eliminate that position by
entering a closing purchase order for 500 shares of JKH
A hedge fund having a “lock-up provision” means that
investors are required to maintain the investment for a minimum length of time
between cds and negotiable cds which of the following are money market instruments
only negotiable cds
When a firm engages in proprietary trading, buying into and selling out of its own inventory for profit, it is acting as
market maker
The statute of limitations on fraudulent practices, under the Securities Exchange Act of 1934, is how long
is 3 years from the event itself, or one year from its discovery, whichever comes sooner.
Which of the following is a debt instrument that pays no periodic interest
Strip
Which of following securities is least likely to have an active trading market?
A)Real estate investment trusts (REITs)
B)Limited partnership interests
C)Preferred shares
D)Municipal bonds
limited partnership interest
A party wishing to solicit proxy authority to vote a particular stockholder’s shares must register with
the sec
A registered representative provides financial support and housing at her home for her grandfather. Regarding the purchase of new issues,
Working for a BD, the RR is considered restricted. While grandparents of restricted persons are generally not considered restricted, anyone being provided financial support and/or living under the same roof as a restricted person (as is the case here) is also restricted.
The date that the principal amount of a loan is due to be paid back to an investor is known as
maturity date
Allowing one’s securities to be loaned to others who want to borrow them for the purpose of selling them short would entail
signing a loan consent form
No credit may be extended in a new margin account with less than
2000 in equity
A broker-dealer is confronted with margin deposit due but not yet received. The BD can choose to take no action, neither selling out the securities nor requesting an extension, if the amount due is
less than 1000
____are sometimes offered as “sweeteners” attached to bond issues to improve the marketability of bond.
warrents
Regarding the purchase of new equity issues (IPOs), restricted persons may
not purchase shares of a new issue
the firm can take a loss if
there was an error on the part of the firm
A customer’s account has been frozen. Which of the following is TRUE if the customer wants to purchase more securities?
Funds to pay in full must be available in the account before the buy order is entered.
When investors open a position by going long the security, they can close the position by
selling the security
A company that is extensively overleveraged using debt financing whenever available would be exposing its investors to
financial risk
All of the following are exempt from the Federal Reserve Board (FRB) Regulation T margin requirements EXCEPT
corporate stocks
An investor having no affiliation with CDS Company has just purchased shares that were sold subject to Rule 144. This investor
can sell the shares unrestricted at any time
Selling shares under Rule 144 effectively registers the shares. In other words, buyers of stock being sold subject to Rule 144 are not subject to any restrictions if they choose to resell.
Which of the following would lead to a standardized cost-base adjustment for stockholders?
dividend
A member firm suspects financial exploitation of a senior customer. Which of the following is true regarding actions that can be taken?
A trusted contact person if one was named can be contacted and a temporary hold on disbursements from the account can be administered.
A registered person has left the securities industry and now holds a manufacturing job. Under what circumstances may this formerly registered person continue to receive commissions from work done at the person’s old firm?
A contract must have been signed by the registered person and the firm specifying what commissions are still to be paid.
Municipal revenue bonds are
not subject to statutory debt limits and do not require voter approval
The growth potential in the price of preferred shares is generally considered to be
less than that of the issuer’s common shares
A barometer of short-term interest rates and one that is therefore considered the most volatile interest rate in the U.S. economy is
fed funds rate
When a corporation issues a mortgage bond, the issue’s total value
should be less than that of the real estate it is backed by
Which of the following is an example of an unsecured debt security?
debenture and income bond
Which of the following require voter approval?
municipal general obligation bonds
A broker-dealer firm has just rehypothecated a thousand shares of MMS stock. This means
the customer pledged the stock to the firm, which has now pledged it to a bank
what happens first with options .
Sign agreement or enter order
enter order first
15 calander days until options agreement needs to be signed
Which of the following would cause a mutual fund’s NAV per share to fall?
dividends payed to share holders and market value of portfolio declines
Which of the following investment companies has an actively managed portfolio?
closed end company
Once a customer account has been opened at a broker-dealer, rules require that updating information on the account record occur no less frequently than once every
36 months
A tombstone advertisement would be expected to include all of the following information EXCEPT
any inherent risks associated with the offering or the issuer offering the securities
The Securities Act of 1933 requires that all of the following be offered by a prospectus EXCEPT:
treasury bonds
Treasury securities are exempt from registration requirements, and therefore do not require a prospectus.
Gifts and gratuities directed to those who work at another firm may not be made by a member or associated person for amounts greater than
$100 per individual per year
Public offerings of securities are regulated under
the Securities Act of 1933
Which of the following securities are most likely deemed marginable by either the Federal Reserve Board (FRB) or regulatory bodies such as FINRA and the New York Stock Exchange?
treasury bonds
common stockholders can or cannot vote for authorization or issue of more common shares
they CAN
Your broker-dealer, rather than clear its own securities transactions, chooses to introduce its business to another firm that will clear, processes and handle all back-office operations for it. The firm receiving the business is known as
a carrying firm
Secured corporate debt includes
mortgage debt
A 40-year-old individual is not covered by a retirement plan at work. What is the maximum contribution this individual can make to an IRA this year?
The current maximum allowed by the IRS, which will all be deductible if the individual does not exceed the income limit.
All of the following are considered unique or nonstandard corporate actions EXCEPT
3-1 stock split
