FREE AND STUDY GAMES ABOUT SERIES 66 EXAM

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FREE AND STUDY GAMES ABOUT SERIES 66 EXAM

QUESTIONS

Actual Qs and Ans Expert-Verified Explanation

This Exam contains:

-Guarantee passing score -1280 Questions and Answers -format set of multiple-choice -Expert-Verified Explanation

Question 1: Buy limit orders are placed ________ the market.

Answer:

Buy limit orders are placed below the market.Question 2: If a corporation raises capital bye selling new shares of its stock to the public, is it considered a B/D?

Answer:

No. The corporation is an issuer and issuers are excluded from the B/D definition.

Question 3: Define an insider.

Answer:

Officers, directors, partners, greater than 10% owners, and immediate family members of all listed Question 4: Over the last 3 months, Jim's stock rose from $50 to $51 and he received a $.25 dividend. What is the annualized return?

Answer:

The 3-month return is 2.5% ($1.25 ÷ $50). A quarterly return may be annualized by multiplying by 4 (2.5% x 4 = 10%).

Question 5: As it applies to a B/D or IA, what does the term "exclusion" mean in the USA?

Answer:

Exclusion signifies that a person does not meet the definition of a B/D or IA in the state.

Question 6: Define commingling.

Answer:

The prohibited act of mixing client funds with those of the B/D

Question 7: What is forward pricing?

Answer:

A process used in mutual funds of determining the net asset value of shares purchased and redeemed.The value is computed at the close of business of the New York Stock Exchange. This value applies to all purchases and redemptions made on that day.

Question 8: Is a 401(k) plan considered a security?

Answer:

No Question 9: True or False: Securities issued by municipalities of Mexico are exempt under the USA.

Answer:

True. An exemption applies to securities issued by foreign governments with whom the U.S. has diplomatic relations.Question 10: True or False: Blue-Sky Laws apply to broker-dealers and agents operating within a state.

Answer:

True

Question 11: B/D records must be kept for at least ____ years.

Answer:

B/D records must be kept for at least 3 years.

Question 12: What is Net Investment Income?

Answer:

Dividends are paid from net investment income of a mutual fund. Net investment income is the total dividends received from common and preferred stock held in the portfolio and all interest income received from bonds and other debt instruments.Question 13: True or False: If a B/D registers in a state on March 3, it must pay a registration fee for the full year.

Answer:

True Question 14: If a security's beta is more than 1, is it considered more or less volatile than the market as a whole?

Answer:

The higher the beta, the greater the volatility.Question 15: Identify the acronym: USA

Answer:

Uniform Securities Act Question 16: Is there a limit to the amount of net capital the Administrator may require of a B/D?

Answer:

Yes. The Administrator may not set a requirement that exceeds the SEC requirement.Question 17: True or False: A firm producing investment research for B/Ds to deliver to clients is considered an IA under the USA.

Answer:

True. Since advice is being provided, as a business, and compensation is received, the ABC test is met.

Question 18: What is a bear market?

Answer:

A market in that prices of securities are falling or are expected to fall.

Question 19: A B/D in New York gets an order from a client who is on vacation in Florida. Does the firm need to register in Florida?

Answer:

No. Registration is not required since the client is an existing client who is temporarily in Florida.Question 20: What is the risk that investors may be unable to dispose of a securities position quickly and at a fair price?

Answer:

Liquidity risk

Question 21: Is an accountant defined as an IA?

Answer:

No. Accountants are excluded from the IA definition if their advice is incidental to their business.Question 22: True or False: Bank holding companies are not considered IAs under the Investment Advisers Act of 1940.

Answer:

True

Question 23: What is the criminal penalty for insider trading by corporations?

Answer:

$25 million per violation

Question 24: When will an offer fall under an Administrator's jurisdiction?

Answer:

If the offer originated in, was directed in, or was accepted in the Administrator's state

Question 25: What is a first Mortagage Bond?

Answer:

A bond that has prior claim over all other security holders upon the assets of the corporation specified in the indenture.

Question 26: Define impersonal advisory services.

Answer:

Services costing less than $200 per year that are not tailored to meet the investment objectives of specific clients