Understanding Trading, Customer Accounts And Prohibited Activities Flashcards
A trader without inside information who enters a trade at the same time as a trader with inside information
Contemporaneous trader
The original purchase price of a security inclusive of sale charges used to calculate capital gains and losses
Cost basis
The feeling or tone of the market the prevailing attitude of investors as to the anticipated price development in a market
Market sentiment
An equity index that is used as the benchmark for small cap stocks and mutual funds
Russell 2000
A market cap weighted index that is common benchmark for the broader U.S. equity market
S&P 500
Allows an investor who is selling securities that have been acquired through a series of purchases to select the specific shares being sold using either the FIFO (first in first out) or LIFO ( last in first out) method
Specific identification
An individual who obtains products or services from a financial institution but who usually has no contact with that institution beyond the one time delivery of products or services
Consumer
Any written or email messages distributed to either existing customers or to 25 or fewer prospective customers within any 30 calendar day period
Correspondence
An individual or entity with which a financial institution expects to have a continuing relationship
Customer
Securities carried in a special cash account or in a margin account in which the customer has made full payment
Fully paid securities
Collateralizing Securities as in margin or hypothecation agreement permitting the broker/dealer to pledge them as collateral to a bank or another broker/dealer
Hypothecation
Securities held for a customer in a margin account as defined by regulation T
Margin securities
The process of making illegally gained proceeds appear legal
Money laundering
Any written or electronic communication distributed or made generally available to customers or the public
Retail communications
