FINRA SIE Exam – 100
Questions & Answers (Correct
Answers Marked with ✓)
1–20: Capital Markets
1. Which market is used for the initial sale of new securities to the public?
A. Secondary market
B. Fourth market
C. Primary market ✓
D. Third market
2. Which regulatory body is responsible for enforcing federal securities laws?
A. FINRA
B. MSRB
C. SEC ✓
D. OCC
3. An investor buying shares from another investor is participating in which market?
A. Primary
B. Secondary ✓
C. Fourth
D. Auction
4. Which act created the Securities and Exchange Commission (SEC)?
A. Securities Exchange Act of 1934 ✓
B. Securities Act of 1933
C. Investment Company Act of 1940
D. Trust Indenture Act of 1939
5. The Securities Act of 1933 focuses on:
A. Fraud in the secondary markets
B. Initial securities offerings ✓
, C. Regulation of investment companies
D. Insider trading rules
6. Stabilization in a new issue is performed by the:
A. Issuer
B. Syndicate manager ✓
C. Transfer agent
D. Underwriter’s counsel
7. A broker-dealer selling proprietary positions is acting as a:
A. Agent
B. Principal ✓
C. Custodian
D. Trustee
8. Which of the following is not an SRO?
A. FINRA
B. MSRB
C. NYSE
D. SEC ✓
9. Which market deals with large institutional trades executed off-exchange?
A. Third market
B. Fourth market ✓
C. Primary market
D. Regular-way market
10. "Blue-sky laws" refer to:
A. Federal regulations
B. State securities laws ✓
C. Municipal codes
D. FINRA rules
11. A tombstone ad may contain all of the following except:
A. Offering price
B. Names of underwriters
C. Detailed disclosures ✓
D. Type of security offered
12. The cooling-off period is typically:
A. 10 days
, B. 30 days
C. 20 days ✓
D. 40 days
13. Which party prepares the official statement for municipal issues?
A. Underwriter
B. Issuer ✓
C. SEC
D. Trustee
14. A shelf registration allows issuers to:
A. Delay SEC filings
B. Issue securities on an as-needed basis ✓
C. Avoid prospectus delivery
D. Reduce underwriting fees
15. In a firm commitment underwriting, underwriters:
A. Act only as agents
B. Assume market risk ✓
C. Do not purchase securities
D. Guarantee profits to issuer
16. Rule 147 applies to:
A. Foreign issuers
B. Intrastate offerings ✓
C. Municipal bonds
D. Money market funds
17. The SIPC protects customers against:
A. Market losses
B. Broker-dealer bankruptcy ✓
C. Identity theft
D. Investment scams
18. A qualified institutional buyer (QIB) must have at least:
A. $10 million invested ✓
B. $25 million invested
C. $50 million invested
D. $5 million invested
, 19. Regulation A+ allows:
A. Private placements only
B. Mini public offerings up to $75 million ✓
C. Shelf offerings
D. Municipal bond offerings
20. Treasury securities are issued by:
A. Federal Reserve
B. U.S. Treasury Department ✓
C. FINRA
D. OCC
21–40: Product Knowledge
21. Common stockholders have:
A. Guaranteed dividends
B. Voting rights ✓
C. Senior liquidation rights
D. No risk of loss
22. Preferred stockholders receive:
A. Voting rights
B. Guaranteed redemption
C. Fixed dividends ✓
D. No interest rate risk
23. ADRs represent ownership in:
A. U.S. companies
B. Foreign companies ✓
C. Mutual funds
D. Private equity
24. A bond trading at 102 is trading at:
A. Par
B. Discount
C. Premium ✓
D. Yield basis
Questions & Answers (Correct
Answers Marked with ✓)
1–20: Capital Markets
1. Which market is used for the initial sale of new securities to the public?
A. Secondary market
B. Fourth market
C. Primary market ✓
D. Third market
2. Which regulatory body is responsible for enforcing federal securities laws?
A. FINRA
B. MSRB
C. SEC ✓
D. OCC
3. An investor buying shares from another investor is participating in which market?
A. Primary
B. Secondary ✓
C. Fourth
D. Auction
4. Which act created the Securities and Exchange Commission (SEC)?
A. Securities Exchange Act of 1934 ✓
B. Securities Act of 1933
C. Investment Company Act of 1940
D. Trust Indenture Act of 1939
5. The Securities Act of 1933 focuses on:
A. Fraud in the secondary markets
B. Initial securities offerings ✓
, C. Regulation of investment companies
D. Insider trading rules
6. Stabilization in a new issue is performed by the:
A. Issuer
B. Syndicate manager ✓
C. Transfer agent
D. Underwriter’s counsel
7. A broker-dealer selling proprietary positions is acting as a:
A. Agent
B. Principal ✓
C. Custodian
D. Trustee
8. Which of the following is not an SRO?
A. FINRA
B. MSRB
C. NYSE
D. SEC ✓
9. Which market deals with large institutional trades executed off-exchange?
A. Third market
B. Fourth market ✓
C. Primary market
D. Regular-way market
10. "Blue-sky laws" refer to:
A. Federal regulations
B. State securities laws ✓
C. Municipal codes
D. FINRA rules
11. A tombstone ad may contain all of the following except:
A. Offering price
B. Names of underwriters
C. Detailed disclosures ✓
D. Type of security offered
12. The cooling-off period is typically:
A. 10 days
, B. 30 days
C. 20 days ✓
D. 40 days
13. Which party prepares the official statement for municipal issues?
A. Underwriter
B. Issuer ✓
C. SEC
D. Trustee
14. A shelf registration allows issuers to:
A. Delay SEC filings
B. Issue securities on an as-needed basis ✓
C. Avoid prospectus delivery
D. Reduce underwriting fees
15. In a firm commitment underwriting, underwriters:
A. Act only as agents
B. Assume market risk ✓
C. Do not purchase securities
D. Guarantee profits to issuer
16. Rule 147 applies to:
A. Foreign issuers
B. Intrastate offerings ✓
C. Municipal bonds
D. Money market funds
17. The SIPC protects customers against:
A. Market losses
B. Broker-dealer bankruptcy ✓
C. Identity theft
D. Investment scams
18. A qualified institutional buyer (QIB) must have at least:
A. $10 million invested ✓
B. $25 million invested
C. $50 million invested
D. $5 million invested
, 19. Regulation A+ allows:
A. Private placements only
B. Mini public offerings up to $75 million ✓
C. Shelf offerings
D. Municipal bond offerings
20. Treasury securities are issued by:
A. Federal Reserve
B. U.S. Treasury Department ✓
C. FINRA
D. OCC
21–40: Product Knowledge
21. Common stockholders have:
A. Guaranteed dividends
B. Voting rights ✓
C. Senior liquidation rights
D. No risk of loss
22. Preferred stockholders receive:
A. Voting rights
B. Guaranteed redemption
C. Fixed dividends ✓
D. No interest rate risk
23. ADRs represent ownership in:
A. U.S. companies
B. Foreign companies ✓
C. Mutual funds
D. Private equity
24. A bond trading at 102 is trading at:
A. Par
B. Discount
C. Premium ✓
D. Yield basis
