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Questions and Answers
The redemption value of an open-end investment company's shares is based on the:
The redemption value of an open-end investment company's shares is based on the:
- NAV computed after the order is received (correct)
- Offering price computed after the order is received
- Previous closing NAV
- Previous offering price
The computation of dollar prices and accrued interest on municipal bonds is normal on what calendar basis?
The computation of dollar prices and accrued interest on municipal bonds is normal on what calendar basis?
- Actual/360
- 30/360 (correct)
- Actual/365
- 30/365
Blue-sky laws are regulated by which of the following entities?
Blue-sky laws are regulated by which of the following entities?
- SEC
- MSRB
- FINRA
- State securities regulators (correct)
At the time of issuance, which of the following securities normally has the longest period to expiration?
At the time of issuance, which of the following securities normally has the longest period to expiration?
Regular way settlement on Treasury Bonds is:
Regular way settlement on Treasury Bonds is:
A firm is a participant in a public offering. To sell a substantial amount of the securities to its customers, the firm agrees to repurchase the shares at no less than the original sales price. Such agreements are:
A firm is a participant in a public offering. To sell a substantial amount of the securities to its customers, the firm agrees to repurchase the shares at no less than the original sales price. Such agreements are:
Under SEC S-P (Consumer Privacy), which of the following information must a firm include in its customer privacy and opt-out notices?
Under SEC S-P (Consumer Privacy), which of the following information must a firm include in its customer privacy and opt-out notices?
UTMA accounts are opened under the tax ID number of the:
UTMA accounts are opened under the tax ID number of the:
Under FINRA rules, noncash compensation connected with the sale of variable contracts includes all of the following items EXCEPT:
Under FINRA rules, noncash compensation connected with the sale of variable contracts includes all of the following items EXCEPT:
Describe the difference between primary distribution and secondary distribution.
Describe the difference between primary distribution and secondary distribution.
If a market maker posts quotes of 10.00 - 10.10 (25x10), which of the following actions is the market maker willing to take?
If a market maker posts quotes of 10.00 - 10.10 (25x10), which of the following actions is the market maker willing to take?
All of the following risks apply to both foreign and domestic debt instruments EXCEPT:
All of the following risks apply to both foreign and domestic debt instruments EXCEPT:
A married couple who earned income that exceeded $300k in each of the prior two years and reasonably expects the same for this current year is:
A married couple who earned income that exceeded $300k in each of the prior two years and reasonably expects the same for this current year is:
The owner of which of the following products is MOST exposed to inflationary risks?
The owner of which of the following products is MOST exposed to inflationary risks?
What is the concept of an annuity contract?
What is the concept of an annuity contract?
Which of the following statements is true about all US Gov agency issues?
Which of the following statements is true about all US Gov agency issues?
Direct participation programs (DPP's) provide:
Direct participation programs (DPP's) provide:
Which of the following outcomes are possible for the writer of a covered call option?
Which of the following outcomes are possible for the writer of a covered call option?
Study Notes
Open-End Investment Companies
- Redemption value of shares is based on NAV computed after the order is received.
Municipal Bonds
- Accrued interest and dollar prices are typically computed using a 30/360 calendar basis.
Blue-Sky Laws
- These laws are regulated by state securities regulators.
Securities Expiration
- Warrants normally have the longest period to expiration at the time of issuance.
Treasury Bonds Settlement
- Regular way settlement for Treasury Bonds occurs the next business day.
Public Offering Agreements
- A firm must not engage in agreements to repurchase shares at the original sale price as this is considered fraudulent and manipulative.
SEC S-P Regulations
- Firms must include policies to protect the security of nonpublic information in customer privacy and opt-out notices.
UTMA Accounts
- These accounts are set up under the tax ID number of the minor.
Noncash Compensation in Variable Contracts
- Commissions are not included in noncash compensation related to the sale of variable contracts.
Distribution Types
- Primary distribution involves the sale of newly issued shares, whereas secondary distribution involves sales of already issued shares.
Market Maker Quotes
- A market maker willing to buy 2,500 shares at $10 and sell 1,000 shares at $10.10 exhibits interest based on the posted quote of 10.00 - 10.10 (25x10).
Debt Instrument Risks
- Exchange risk does not apply to both foreign and domestic debt instruments.
Accredited Investor
- A married couple earning over $300k in each of the last two years, and expecting the same in the current year, qualifies as an accredited investor.
Inflationary Risks
- Treasury bonds are most exposed to inflationary risks compared to other assets listed.
Annuity Contracts
- The type of annuity selected influences the payment amounts provided to the annuitant.
US Government Agency Issues
- These issues are exempt from registration requirements under the Securities Act of 1933.
Direct Participation Programs (DPPs)
- DPPs offer exposure to non-correlated assets that tend to provide steady returns.
Covered Call Options
- The writer of a covered call option experiences both profit and loss limits.
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Description
Test your knowledge with these flashcards designed for the FINRA Securities Industry Essentials (SIE) Exam. Each card contains key concepts related to investment companies, NAV calculations, and municipal bonds. Perfect for quick revision and enhancing your understanding of essential finance topics.
