STC SIE Exam Prep Questions and
Answers 100% Pass
Who keeps track of the shareholders of a mutual fund?
A. The custodian bank
B. The transfer agent
C. The investment adviser
D. The underwriter - ANSWER✔✔-B. The transfer agent
Which of the following choices would NOT be subject to the holding period restriction
under Rule 144?
A. Restricted stock acquired under an investment letter
B. Restricted stock acquired under a stock option plan
C. Control stock acquired under a private placement
D. Control stock acquired through an open-market purchase - ANSWER✔✔-D. Control
stock acquired through an open-market purchase
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,There is a required holding period of six months for all restricted stock. Restricted stock
is unregistered stock that was acquired as a result of a private placement. There is no
required holding period for control stock. However, if an affiliate (control person)
acquires stock as a result of a private placement, this stock would be considered
restricted stock rather than control stock and would be subject to the holding period.
Control stock acquired as a result of an open-market purchase is exempt from the
holding period.
The investments that tend to perform the WORST during periods of inflation are:
A. Bonds
B. Mutual Funds
C. ETFs
D. Gold and Silver - ANSWER✔✔-A. Bonds
If a customer exceeds SIPC limits:
A. The customer will receive cash rather than his securities
B. The customer is a secured creditor
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,C. The customer doesn't have a claim to the excess amount
D. The customer is a general creditor - ANSWER✔✔-D. The customer is a general
creditor
When discussing the purchase of a variable annuity with a client, the RR is not required
to disclose:
A. Surrender fees
B. Mortality fees
C. Probate fees
D. Administrative fees - ANSWER✔✔-C. Probate fees
Probate fees and costs are associated with establishing the validity of a will, which is
not a disclosure item for annuities. However, surrender, mortality, and administrative
fees must be disclosed
Jamie has inherited 500 shares of an investment company. She calls her broker to
redeem the shares and is informed that the kind of investment company she owns
makes no provision for future purchases or redemptions. What kind of investment
company does she own?
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, A. An open-end fund
B. A closed-end fund
C. A unit investment trust
D. A face-amount certificate company - ANSWER✔✔-B. A closed-end fund
A closed-end fund makes no provision for future purchases or redemptions from the
issuing fund.
Which of the following is TRUE if a mutual fund investor chooses to implement a
systematic withdrawal plan from the fund?
A. The dividends and capital gains that are generated from the fund will be sufficient to
make the payments.
B. All payments will end on a specific date.
C. The amount of each payment will remain the same.
D. The withdrawals result in a reduction of capital. - ANSWER✔✔-D. The withdrawals
result in a reduction of capital.
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Answers 100% Pass
Who keeps track of the shareholders of a mutual fund?
A. The custodian bank
B. The transfer agent
C. The investment adviser
D. The underwriter - ANSWER✔✔-B. The transfer agent
Which of the following choices would NOT be subject to the holding period restriction
under Rule 144?
A. Restricted stock acquired under an investment letter
B. Restricted stock acquired under a stock option plan
C. Control stock acquired under a private placement
D. Control stock acquired through an open-market purchase - ANSWER✔✔-D. Control
stock acquired through an open-market purchase
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,There is a required holding period of six months for all restricted stock. Restricted stock
is unregistered stock that was acquired as a result of a private placement. There is no
required holding period for control stock. However, if an affiliate (control person)
acquires stock as a result of a private placement, this stock would be considered
restricted stock rather than control stock and would be subject to the holding period.
Control stock acquired as a result of an open-market purchase is exempt from the
holding period.
The investments that tend to perform the WORST during periods of inflation are:
A. Bonds
B. Mutual Funds
C. ETFs
D. Gold and Silver - ANSWER✔✔-A. Bonds
If a customer exceeds SIPC limits:
A. The customer will receive cash rather than his securities
B. The customer is a secured creditor
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,C. The customer doesn't have a claim to the excess amount
D. The customer is a general creditor - ANSWER✔✔-D. The customer is a general
creditor
When discussing the purchase of a variable annuity with a client, the RR is not required
to disclose:
A. Surrender fees
B. Mortality fees
C. Probate fees
D. Administrative fees - ANSWER✔✔-C. Probate fees
Probate fees and costs are associated with establishing the validity of a will, which is
not a disclosure item for annuities. However, surrender, mortality, and administrative
fees must be disclosed
Jamie has inherited 500 shares of an investment company. She calls her broker to
redeem the shares and is informed that the kind of investment company she owns
makes no provision for future purchases or redemptions. What kind of investment
company does she own?
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, A. An open-end fund
B. A closed-end fund
C. A unit investment trust
D. A face-amount certificate company - ANSWER✔✔-B. A closed-end fund
A closed-end fund makes no provision for future purchases or redemptions from the
issuing fund.
Which of the following is TRUE if a mutual fund investor chooses to implement a
systematic withdrawal plan from the fund?
A. The dividends and capital gains that are generated from the fund will be sufficient to
make the payments.
B. All payments will end on a specific date.
C. The amount of each payment will remain the same.
D. The withdrawals result in a reduction of capital. - ANSWER✔✔-D. The withdrawals
result in a reduction of capital.
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