Series 65 (Investment Vehicle
Characteristics) UPDATED ACTUAL Exam
Questions and CORRECT Answers
Conversion ratio = - CORRECT ANSWER - Par Value / Conversion Price
Conversion price = - CORRECT ANSWER - Par Value / conversion ratio
Parity Price (common stock) = - CORRECT ANSWER - Pref. Market price / conversion ratio
Parity Price (Pref. stock) = - CORRECT ANSWER - common share price * conversion ratio
Rule 144 of Restricted stock - CORRECT ANSWER - must be held for 6 months before
resale
Rule 144 of control stock - CORRECT ANSWER - can sell the greater of 1% of outstanding
shares or the four-week trading average, 4 times a year
Form 144 must be filed when an investor intends to trade controlled or restricted stock in the
next __ days - CORRECT ANSWER - 90
Form 144 must only be filed if an investor intends to trade more than __ shares or $___ value of
stock - CORRECT ANSWER - 5,000 shares or $50,000 total value
Form 144 is typically filed with what tool - CORRECT ANSWER - EDGAR
Form 4 must be filed within __ days of a controlled stock transaction - CORRECT
ANSWER - 2
, A Qualified Institutional Buyer (QIB) has a minimum $__ in assets - CORRECT ANSWER -
100 million
T or F When a QIB is involved in a controlled or restricted stock purchase transaction, rule 144
does not apply - CORRECT ANSWER - True
T or F The 6 month holding period still applies when a QIB is selling controlled or restricted
stock - CORRECT ANSWER - False
Corporate exclusion rule: exempt __ percent if owning less than 20% of a company, and __
percent if owning 20% or more - CORRECT ANSWER - 50% and 65%
dividends are reported annually on IRS form - CORRECT ANSWER - 1099-DIV
capital gains are reported annually on IRS form - CORRECT ANSWER - 1099-B
Quick Ratio (QR) = - CORRECT ANSWER - Current assets - inventory / current liabilities
Saucer Bottom formation is a __ __ trend and a __ indicator - CORRECT ANSWER - reverse
downward, bullish
Saucer top formation is a __ __ trend and a __ indicator - CORRECT ANSWER - reverse
upward, bearish
market breadth refers to - CORRECT ANSWER - the general direction of the market
an overbought market occurs when - CORRECT ANSWER - markets are still rising, but
heading for a correction
Characteristics) UPDATED ACTUAL Exam
Questions and CORRECT Answers
Conversion ratio = - CORRECT ANSWER - Par Value / Conversion Price
Conversion price = - CORRECT ANSWER - Par Value / conversion ratio
Parity Price (common stock) = - CORRECT ANSWER - Pref. Market price / conversion ratio
Parity Price (Pref. stock) = - CORRECT ANSWER - common share price * conversion ratio
Rule 144 of Restricted stock - CORRECT ANSWER - must be held for 6 months before
resale
Rule 144 of control stock - CORRECT ANSWER - can sell the greater of 1% of outstanding
shares or the four-week trading average, 4 times a year
Form 144 must be filed when an investor intends to trade controlled or restricted stock in the
next __ days - CORRECT ANSWER - 90
Form 144 must only be filed if an investor intends to trade more than __ shares or $___ value of
stock - CORRECT ANSWER - 5,000 shares or $50,000 total value
Form 144 is typically filed with what tool - CORRECT ANSWER - EDGAR
Form 4 must be filed within __ days of a controlled stock transaction - CORRECT
ANSWER - 2
, A Qualified Institutional Buyer (QIB) has a minimum $__ in assets - CORRECT ANSWER -
100 million
T or F When a QIB is involved in a controlled or restricted stock purchase transaction, rule 144
does not apply - CORRECT ANSWER - True
T or F The 6 month holding period still applies when a QIB is selling controlled or restricted
stock - CORRECT ANSWER - False
Corporate exclusion rule: exempt __ percent if owning less than 20% of a company, and __
percent if owning 20% or more - CORRECT ANSWER - 50% and 65%
dividends are reported annually on IRS form - CORRECT ANSWER - 1099-DIV
capital gains are reported annually on IRS form - CORRECT ANSWER - 1099-B
Quick Ratio (QR) = - CORRECT ANSWER - Current assets - inventory / current liabilities
Saucer Bottom formation is a __ __ trend and a __ indicator - CORRECT ANSWER - reverse
downward, bullish
Saucer top formation is a __ __ trend and a __ indicator - CORRECT ANSWER - reverse
upward, bearish
market breadth refers to - CORRECT ANSWER - the general direction of the market
an overbought market occurs when - CORRECT ANSWER - markets are still rising, but
heading for a correction
