Advisers and other service providers to most ERISA-covered plans must disclose their fees, following a U.S. Department of Labor (DOL) regulation that became effective July 1, 2012. These regulations are designed to dovetail with corresponding regulations that require plans to disclose service provider information to DOL in a timely manner. A service provider’s failure to […]
A condor spread is similar to a butterfly spread and is the simultaneous establishment of both a bull spread and a bear spread on the same underlying security. A condor spread however, has two inner strikes in the center of the position instead of one in a butterfly spread. A condor spread contains four options […]
The money market is a place where issuers go to obtain short-term financing. An issuer who needs funds for a short term, typically under one year, will sell short-term instruments known as money market instruments to obtain the necessary funds. Corporations, Municipalities, and the US Government will all use the money market to obtain short-term […]
If you are taking The SIE exam, the Series 7 series 24 or series 99 exam, here are the must know facts about margin accounts to ensure you pass your exam. The Federal Reserve Board sets the amount that must be deposited when customers purchase securities using borrowed funds. This is known as the initial […]
Offering of Securities by FINRA Members When a FINRA member firm wishes to raise money by offering securities for sale to investors special rules apply to the offering. When a FINRA member firm goes public it may not underwrite its own securities. The member wishing to go public must engage the services of a qualified […]
Under the Uniform Securities Act, which of the following would not have to be disclosed when filing a registration by qualification? A. A statement analyzing the issuer’s profit margin over the last three years compared to the profit margins of its primary competitors B. The capitalization and long-term debt of the issuer and any significant […]
An investor has a margin account as follows. Regulation T is 50%. Long 100 XYZ @ 80\tab Debit Balance $11,700 Long 100 PDQ @ 100\tab SMA -0- He sells 20 shares of PDQ for $2,000. The SMA can be credited with: A. $0 B. $1,000 C. $500 D. $2,000 Correct Answer(s): B. $1,000 Explanation: The […]
An investor establishes the following: Short 700 ONST at 39.20 Short 7 ONST May 37.50 puts at 2.90 Which of the following are not false? I. The investor has the potential for an unlimited gain II. The investor’s potential loss exceeds their potential gain III. The Investor is bearish IV. The investor is fully hedged […]
Your firm is a market maker and is participating in an offering of securities as a syndicate member. You firm is acting as a passive market maker and has purchased 12,000 shares which is 98% of its ADTV. An order comes into the firm’s trading desk to sell 3,000 shares at 2:40. Which of the […]
Many large mutual fund companies offer the following privileges to their investors: A. Combination privileges B. Conversion and exchange privileges C. 30-Day emergency withdrawal D. All of the choices listed Correct Answer(s): D. All of the choices listed Explanation: Large mutual fund companies frequently offer all of the choices listed privileges to their investors.
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