SIE Exam (Kaplan)

Anyone making call cold calls for the firm must disclose

The reps name and the firms name, address, and phone number

What customer info must be kept on record for 6 years?

Customer statements and new account forms

A customer of a securities firm has concluded that selling short would be an effective trading technique to reach his investment goals. Assuming the firm's principal agrees to permit the customer to effect short sales, what type of account would be most suitable for short selling?

Margin account b/c must satisfy FRB margin requirements to short sell

Fiduciary Account

A fiduciary is a person who acts on behalf of another person and can initiate trades (trust, guardian, and custodial accs)

What are the types of systematic risk?

Market risk, interest rate risk, exchange rate risk, inflation (purchase power) risk

It would be expected that a repurchase (repo) agreement contract would include

The repurchase price and the maturity date

When opening an account for a corporation, one of the required documents is a corporate resolution. Who makes the resolution?

The BOD's

Selling long is equivalent to which of the following?

When a customer owns a position and then sells that position, that is referred to as selling long or selling to close

What happens to the contents of a custodial account in the event of the death of the beneficial owner (the minor child)?

The custodian's fiduciary responsibility ceases and the account passes on to the minor's estate

What are considered passive investments?

real estate investments and limited partnership (DPP) investments

losses only deductible against other passive income

What do mutual funds and common stock have in common?

Investors retain voting rights

How long are Series 6/7 good for if inactive? SIE exam?

within 2 years and within 4 years

A partnership would like to open a margin account. Which of the following is not needed?

A partnership agreement that specifically allows margin borrowing

Which of the following would be required for a good 'til canceled order to remain in force for more than six months?

For the order to stay in effect longer than six months, the customer would need to reinstate the order

The broker loan rate charged by banks is also known as

The call loan rate

The Uniform Securities Act (USA) provides a legal framework for the registration of

The USA provides a legal framework for the state registration of securities. It may be adopted by individual states and adapted to their needs

What are the prospectus delivery rules for IPOs and APOs?

The prospectus delivery rules include the following:

IPO for listed or Nasdaq—25 days

APO for listed or Nasdaq—none

IPO for non-Nasdaq—90 days

APO for non-Nasdaq—40 day

What is Keynesian theory?

According to Keynes, a government's fiscal policies determine the country's economic health. Fiscal policy involves adjusting the level of taxation and government spending

What is a solicited order?

A trade that was the initiated by and the broker's idea

What is the penalty, if any, for overcontribution to an IRA?

6%

What is the penalty for not taking the minimum required distribution for an IRA?

25%

Where can you obtain a statement of additional information (SAI) for a mutual fund?

The investment company that offers the fund, the broker dealer, or the SEC

A fee-based account charges

a set amount monthly or quarterly for all trading activity

A U5 form should be filed with the Central Registration Depository within how many days after termination of a registered representative?

within 30 days

When is the electronic filing of all information on customer complaints by broker-dealers with Financial Industry Regulatory Authority (FINRA) due?

Within 15 days of the end of each calendar quarter

How are variable annuities taxed?

Contributions are made with pre-tax dollars and earnings grow tax deferred

What risk do ADRs eliminate?

Liquidity risk

For real estate program partners, tax credits will

reduce tax liability dollar for dollar

How often may funds be rolled over from one state's Section 529 plan to another's?

Once every 12 months

A debt-based unit investment trust (UIT) will feature which of the following?

A fixed portfolio of bonds

Private placements are primarily sold to

institutional investors

When there are significant changes to the client's status, such as salary and bonus potential as well as change of address, the client should notify the member firm

within 30 days