FINRA SERIES 6 EXAM QUESTIONS WITH 100% CORRECT ANSWERS

12b-1 Fee a fee that enables the cost of marketing, to all existing fund shareholders. The maximum 12b-1 fee under FINRA rules is .75% of net assets cannot call a fund a no-load if the 12b-1 exceeds .25% of net assets Ask Price - POP Price at which a market maker will sell 100 shares to public at the next computed net asset value plus a sales charge AMT Alternative minimum tax - tax code that attempts to make high income taxpayers that use a large amount of tax deductions to reduce their taxable income pay a fair tax 26-28% ADR's American depository receipts - registered and listed receipts held by banks such as J.P. Morgan & Chase of foreign corporate securities bought overseas that trade like any other stock Asset Allocation Fund A mutual fund that invests in a variety of asset classes such as foreign securities, domestic U.S. securities (common stocks, preferred stocks, bonds, and money market instruments), real estate, gold, and other precious metals. Authorized Stock The legal number of stock a corporation can issue BA's Bankers Acceptance - a money market instrument used to finance imports and exports Best Efforts Underwriting an investment banker committing to act as a selling agent assuming no financial risk "makes best efforts to sell" Bid Price - NAV Price at which a market maker will buy 100 shares from the public at the net asset value Blend Fund a mutual fund that invests in both growth and value stocks Blue-chip Stock Securities issued from the largest, consistently profitable american companies. "steady growth and dividends" Bond long term debt security issued by a corporation, government, or municipality that pays a fixed or variable interest rate semi annually until maturity which the face value is payed back to the investor.