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91 Cards in this Set
- Front
- Back
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Red herring can be used for ___________ but not for making offers to sell or buy |
Making indications of interest |
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Holding companies are not included in the definition of _________ |
Investment company |
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Investment companies may own up to (but no more than) ____% of another investment companies shares |
Up to 3% |
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Prospectus is defined in the act of ____ |
33 |
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Name 3 things that are defined in the act of 34
1. Transfer agent 2. 3. |
1. Transfer agent 2. Market maker 3. Securities information processor |
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Registration by _______ is the only registration where the administrator sets the effective date |
Qualification |
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If you solicit an exempt security, it does not mean it's an exempt ________ |
Transaction |
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The sale of a security to an institution (ex insurance company) is considered a _____ transaction |
Exempt |
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If an agent wants to appeal an administrator's order he must do so within ____ days |
60 |
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Private placements are exempt ________ not exempt _____ |
Transactions not securities |
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When fees are automatically withdrawn from a clients account _____ of client funds can be presumed |
Custody |
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An administrator can cancel an agents registration is they are considered to be _______ |
Mentally incompetent |
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Securities sold under regulation D are private placements and are considered ________ securities |
Federal covered securities |
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Under the USA, municipal and government securities are ______ from registration |
Exempt |
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For a private placement to be exempt , the offer cannot be directed to more than ___ persons during a ____ month period |
Can't be directed to more than 10 persons during a 12 month period |
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With a private placement, ________ purchasers do not have to purchase the offer for investment purposes only |
Institutional purchasers |
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With a private placement, ________ purchasers do not have to purchase the offer for investment purposes only |
Institutional purchasers |
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An agent who sells a private placement offering to non institutional clients cannot be paid _______ |
Commissions |
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3 things to remember with prudent investor
1. Reasonable care 2. 3. |
Skill and caution |
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Rule 482 |
Omitting prospectus |
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Under the USA, name the 3 types of non-persons
1. People that are deceased 2. 3. |
Minors and people who are mentally incompetent |
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When you multiply price per share times the number of outstanding shares the result is known as ________ |
Market capitalization |
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Charitable or religious organizations must be ____ in order to gain exemption from registration |
Non profit |
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Referrals to professionals must a _____ amount and must be _____ for any referral |
Nominal amount, the same for any referral |
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Referrals to professionals must a _____ amount and must be _____ for any referral |
Nominal amount, the same for any referral |
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The amount of a referral cannot be based on the ______ of the account |
Size |
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________ is the registration method used by investment companies registered under the investment company act of 1940 |
Notice filing |
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When an adviser has custody, they must report the location of the fund labor securities every ____ months |
3 months (quarterly ) |
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When an adviser has custody, they must report the location of the fund labor securities every ____ months |
3 months (quarterly ) |
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Unsolicited transactions are considered _______ transactions |
Exempt |
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If an adviser manages a registered investment company, they must be _________ |
Federal covered |
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In order for commercial paper to be exempt, it must mature in ____ months or less |
9 |
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Banks and bank holding companies that are not classified as investment companies are ______ from the definition of an investment adviser |
Exempt |
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Banks and bank holding companies that are not classified as investment companies are ______ from the definition of an investment adviser |
Exempt |
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Remember: record keeping requirements do not apply to _____ and _____ |
IAR's and Agents |
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Solicitors who are helping IA's who are federal covered IA's must be _______ |
Registered as an IAR |
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Solicitors who are helping IA's must be _______ |
Registered as an IAR... Federal covered and broker dealer solicitors do not need to be |
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Securities traded on the exchanges and Nasdaq are considered ________ |
Federal covered securities
Also exempt |
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Commercial paper can be exempt of it has a minimum denomination of _______k |
50k |
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You can solicit ________ securities only if they are exempt |
Unregistered |
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The administrator can require the broker dealer to post a surety bond if they have _____ and\or _____ |
Discretion or custody |
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It an agent makes a sale in violation of the USA, when the BD offers to buy back the security and and pay the customer interest on the security minus any profit, this is know as the right to ______ |
Rescission |
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529 plans contribution limits are determined by the _____ |
State |
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If their investment objective is capital preservation, look for _______ |
Investment grade |
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Employee contributions are excluded from ______ at the time of contributions |
Taxable income |
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An ESA can be used to fund any _______ |
Education level |
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An ESA can be used to fund any _______ |
Education level |
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________ plans can only be used to fund higher education |
529 |
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Rebalancing is considered a ____ style of investing |
Passive |
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Voting trust certificates are considered _________ |
Securities |
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The term "investment counsel" may be used by any adviser that meets the following two criteria
1. The adviser performs investment ______ services
2. The adviser provides advice as the ______ business of the firm |
Supervisory and primary |
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The risk-reward of an equity security is generally measured by its ________ |
Standard deviation |
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Banks, trust companies, and savings and land associations are specifically excluded from the definition of __________ |
Broker dealer |
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The exchange of securities in a merger is not considered a ______ under the act |
Sale |
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_______ stocks are most likely suitable for investors who believe the business cycle is near its peak |
Defensive |
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_________ protects the retirement funds of corporate employees in the private sector |
ERISA |
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_______ measures how sensitive a bond will be to small changes in interest rates |
Duration |
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_______ measures how sensitive a bond will be to small changes in interest rates |
Duration |
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The measurement that compares a stock prices history to the movement of the total market is known as _____ |
Beta |
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Investment policy statement's generally Found in _______ plans |
Qualified |
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Rating's are not a requirement for a security to be _______ |
Registered |
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When a security is pledged for a loan, it is not a ______ |
Sale |
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Banks and insurance companies are considered ______ investors |
Institutional |
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A _______ security or transaction is exempt from the registration requirements and the requirements for filing of advertising and sales literature |
Exempt |
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The names of all the owners of the companies stock is ______ on the registration statement |
Not required |
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Money market funds typically have a ____ beta |
Low |
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Small cap stocks generally have a ______ standard deviation |
High |
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One advantage of a c Corp is _______ _______ |
Limited liability |
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With zero coupon bonds, the discount must be _____ and taxed _______ |
Accreted and taxes annually |
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Canadian securities are not federally covered but they are ______ |
Exempt |
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With universal life, the policy may be _______ |
Overfunded |
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8-k must be filed within _____ business days |
4 business days |
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S Corp's and LLc's also have ______ _______ just like c Corp's |
Limited liability |
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The lower the standard deviation, the lower the ____ and the lower the _____ |
Volatility and lower risk |
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The sharpe ratio=
The average annual return - _________ divided by the security's _______ |
Sharpe ratio = the average annual return of a security - the risk free rate divided by the security's standard deviation |
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When you're looking for the risk free rate it is usually represented by ______ |
US T-Bills |
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A firms internal research is not considered _______ |
Inside information |
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Any primary offering, unless the security is exempt, requires a _______ |
Prospectus |
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Any primary offering, unless the security is exempt, requires a _______ |
Prospectus |
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Open end investment companies are a continuous ______ offering |
Primary |
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In a _________ trust, you must distribute all of its annual income |
Simple |
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In a _________ trust, you must distribute all of its annual income |
Simple |
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In a ______ trust you are not obligated to distribute all of its annual funds |
Complex |
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A _________ trust, the settlor retains control over assets until death |
Testamentary |
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A _________ trust, the settlor retains control over assets until death |
Testamentary |
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A testamentary trust does not avoid ______ |
Probate |
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If two bonds with the same same maturity have differing coupons, the bond with the longer duration would be the _____ coupon |
Lower coupon has longer duration |
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When a beneficiary receives a death benefit from a life insurance policy, it is free of _____ |
Income tax |
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Hardship withdrawals are not permitted from an _______ |
IRA |
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When the invest sets a specified price for an order, it's a _____ order |
Limit |
