SIE Study Guide 100% Accurate!!
Section 1: Knowledge of Capital Markets - ANSWER
The SEC
purpose/mission
when created
jurisdiction
authority - ANSWERprotect investos, maintin fair orderly & efficient markets, facilitate capital
formation
by congress in 1934
US federal government
enforce federal security laws & create laws that regulate securities industry
enforces Securities act 1933/1934, trust indenture act 1939, investment company act 1940,
investment advisors act 1940
SROs (Self-Regulatory Organizations)
what is the largest SRO? - ANSWERorganization formed to regulate certain professions & industires
to create rules that promote order among businesses& orgs, supplemental to laws/gov
FINRA
CBOE
jurisdiction? - ANSWERoriginated the VIX
Chicago board options exchange
,1st nationally recognized sec exchange listing and trading options.
(lgest option market)
SRO
IRS- US gov agency responsible for collecting most federal taxes and for administering tax rules and
regulations
State Regulators - ANSWERstate/local public service/utilities commission, insurance/annuity,
banking, company info, consumer protection
NASAA
what is it? - ANSWERNorth American Securities Administrators Association
oldest international investor protection organization
(a state regulator)
The Federal Reserve
fiscal or monetary policy?
composed of?
when tighten policy? - ANSWERthe central bank of the United States
control inflation/encourage employment, responsible for clearing checks & supplying currency, most
important to loan $ to other banks & set interest rates, make bank reserve requirements
independent body (meaning looks after broader interests rather than for ones own political interests)
lower rate= more money borrowed= more money in circulation
BOG (board of governors), 12 fed reserve banks, fed open market committee (FOMC=set monetary
policy)
,when inflation is too high
SIPC
oversees? - ANSWERSecurities Investor Protection Corporation
protects customers account in BD bankruptcy cash/securities up to 500,000, cash only 250,000
oversee liquidation of member firms
nonprofit
FDIC
type of agency?
why created?
funded by? - ANSWERFederal Deposit Insurance Corporation
insures depositors of insured banks
independent agency
created by congress to maintain stable financial system, make lg/complex fin institutions resolvable
funded by premium banks and saving associations, not taxpayers
jurisdiction over all writing and trading of standardized options and related contracts listed on
exchange
FINRA
government? - ANSWERFinancial Industry Regulatory Authority
, license and regulate B/Ds
license security dealer, audit dealers/associated firms, ensure compliance, write/enforce rules
governing BDs, regulate trading equities corps bonds sec features options
independent NONgovernmental
largest SRO
MSRB
supports? - ANSWERMunicipal Securities Rulemaking Board
BOD oversee Us municipal & responsible for setting/governing rules
support FINRA
SRO
Department of Treasury/IRS - ANSWERmanage federal finances by collecting taxes and paying bills &
managing currency/gov accs /public debt
backed by full faith and credit of US
Market Participants and Their Roles - ANSWER
Investors
accredited
institutional (ex)
retail - ANSWERcommit capital in expectation of receiving financial returns
Section 1: Knowledge of Capital Markets - ANSWER
The SEC
purpose/mission
when created
jurisdiction
authority - ANSWERprotect investos, maintin fair orderly & efficient markets, facilitate capital
formation
by congress in 1934
US federal government
enforce federal security laws & create laws that regulate securities industry
enforces Securities act 1933/1934, trust indenture act 1939, investment company act 1940,
investment advisors act 1940
SROs (Self-Regulatory Organizations)
what is the largest SRO? - ANSWERorganization formed to regulate certain professions & industires
to create rules that promote order among businesses& orgs, supplemental to laws/gov
FINRA
CBOE
jurisdiction? - ANSWERoriginated the VIX
Chicago board options exchange
,1st nationally recognized sec exchange listing and trading options.
(lgest option market)
SRO
IRS- US gov agency responsible for collecting most federal taxes and for administering tax rules and
regulations
State Regulators - ANSWERstate/local public service/utilities commission, insurance/annuity,
banking, company info, consumer protection
NASAA
what is it? - ANSWERNorth American Securities Administrators Association
oldest international investor protection organization
(a state regulator)
The Federal Reserve
fiscal or monetary policy?
composed of?
when tighten policy? - ANSWERthe central bank of the United States
control inflation/encourage employment, responsible for clearing checks & supplying currency, most
important to loan $ to other banks & set interest rates, make bank reserve requirements
independent body (meaning looks after broader interests rather than for ones own political interests)
lower rate= more money borrowed= more money in circulation
BOG (board of governors), 12 fed reserve banks, fed open market committee (FOMC=set monetary
policy)
,when inflation is too high
SIPC
oversees? - ANSWERSecurities Investor Protection Corporation
protects customers account in BD bankruptcy cash/securities up to 500,000, cash only 250,000
oversee liquidation of member firms
nonprofit
FDIC
type of agency?
why created?
funded by? - ANSWERFederal Deposit Insurance Corporation
insures depositors of insured banks
independent agency
created by congress to maintain stable financial system, make lg/complex fin institutions resolvable
funded by premium banks and saving associations, not taxpayers
jurisdiction over all writing and trading of standardized options and related contracts listed on
exchange
FINRA
government? - ANSWERFinancial Industry Regulatory Authority
, license and regulate B/Ds
license security dealer, audit dealers/associated firms, ensure compliance, write/enforce rules
governing BDs, regulate trading equities corps bonds sec features options
independent NONgovernmental
largest SRO
MSRB
supports? - ANSWERMunicipal Securities Rulemaking Board
BOD oversee Us municipal & responsible for setting/governing rules
support FINRA
SRO
Department of Treasury/IRS - ANSWERmanage federal finances by collecting taxes and paying bills &
managing currency/gov accs /public debt
backed by full faith and credit of US
Market Participants and Their Roles - ANSWER
Investors
accredited
institutional (ex)
retail - ANSWERcommit capital in expectation of receiving financial returns
