Unit 16 Types of Orders and Quotations

Question 1

Delivery versus payment (DVP)

Answer 1

institutional investors
payment is due simultaneously

Question 2

Before opening a margin account, a _____________ must be provided to the client.

Answer 2

rick disclosure agreement
and provided annually

Question 3

Interest in a margin account is based on the __________ rate.

Answer 3

broker call
what the bank charges the broker-dealer

Question 4

Customer pledges collateral for a loan through the……

Answer 4

Hypothecation

Question 5

Rehypothecation

Answer 5

broker-dealer pledges customers collateral to bank

Question 6

A new issues must be outstanding for ___ days before it can be purchased on margin

Answer 6

30

Question 7

Reg T =

Answer 7

50% of current market value

Question 8

Minimum deposited in margin account

Answer 8

greater of $2,000 or 50% of CMV

Question 9

If shares are sold in the margin account, SMA…

Answer 9

increases

Question 10

Buying power in a margin account is _____

Answer 10

2x SMA

Question 11

Investor buys 30k in securities with 30k cash, the SMA would increase by…

Answer 11

15k

Question 12

SMA =

Answer 12

Equity - Reg T

Question 13

Maintenance call MV =

Answer 13

debt balance / 0.75

Question 14

Margin Reg T payment occurs

Answer 14

T+4

Question 15

IF margin payment is not made, account frozen for ___ days

Answer 15

90

Question 16

Spoofing

Answer 16

violation where trader breifly displays a quote to manipulate prices

Question 17

Spinning

Answer 17

underwriter allocates high-demand IPS shares to individuals who can direct securities business to the underwriter