STC Series 66 Greenlight exam
Questions and Answers 100% PASS
Securities that are registered through qualification may only be sold: - CORRECT
ANSWER-Once the registration is declared effective by the Administrator
Securities that are registered through qualification may be sold once the registration
is declared effective by the Administrator. Note that in choice (c), the use of the
term approved is inappropriate. Securities that are deemed effective for sale by an
Administrator may not be described as having been approved by the
Administrator.
The difference between a corporation's current assets and its current liabilities is
the: - CORRECT ANSWER-Working capital
The amount by which a corporation's current assets exceed its current liabilities is
referred to as working capital.
Assuming an expected rate of return, a specific holding period, and a sum to be
invested, an IAR is able to determine an investment's: - CORRECT ANSWER-
Future value
The future value of an investment is based on the present value of the amount
invested, using a discount rate each year, and doing so over a given period of time.
,The assumption is that the annual return is reinvested at the same rate, or is
compounded over the given time period, thereby resulting in a future value that
exceeds the present value.
Which of the following types of risk is MOST associated with the purchase of a
five-year T-bond? - CORRECT ANSWER-Interest-rate
Interest-rate risk, which is also referred to as money-rate risk, is essentially the risk
that if interest rates rise, the prices of the debt securities will fall. If an investor
needs to liquidate her debt investment prior to maturity, rising interest rates reduce
the value she would receive if she sold the security in the secondary market. Market
risk is primarily associated with common stock. Since the secondary market for
Treasuries is very active, liquidity risk is not a factor. Although legislative risk
(changes in the law) could create diminished value for the instruments, it is not
likely to occur.
Disadvantages of investing in a C Corporation include which of the following
choices?
Shareholders are taxed on dividends that they receive.
The corporation is taxed on its income.
Shareholders may not deduct their share of the corporation's losses on their
personal tax returns.
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,Shareholders are paid last if the corporation liquidates. - CORRECT ANSWER-I,
II, III, and IV
All of the choices are disadvantages of investing in a C Corporation
All the following are characteristics of passive asset allocation strategies, EXCEPT:
- CORRECT ANSWER-Altering a portfolio in anticipation of an economic event
A passive asset allocation strategy (e.g., buy and hold) is characterized by low
transaction costs and minimal tax consequences. Systematic rebalancing, another
passive strategy, alters the portfolio on a monthly, quarterly, or annual basis to
restore an original strategic asset allocation if market movements have changed it.
On the other hand, active (tactical) asset allocation strategies effect changes to a
portfolio's allocation in anticipation of economic events.
A person has established an IA as a sole proprietorship and works as an IAR out
of his home office. To help promote and manage the IA, he has set up a website
which contains personal information about his clients. A few weeks after setting up
the website, the IAR discovers that the website has been hacked and his customers'
account information has been stolen. What is the primary regulatory concern? -
CORRECT ANSWER-The IA did not prepare proper cybersecurity policies,
procedures, and measures before launching the website.
Both the SEC and state Administrators require IAs to establish cybersecurity
policies in order to protect their clients. Since the website was hacked, the
regulator's primary concern is the extent of the IA's cybersecurity measures. The
, regulations don't require websites to be password protected, despite the fact that
many IAs may find them necessary to protect client information. Also, there's no
requirement for an IA to be federally covered before creating a website. Although
websites are considered advertisements and regulators must be notified, it's
unlikely that this is the primary regulatory concern.
A Nasdaq listed company is offering 1,000,000 shares of common stock in State A.
The Administrator in State A may:
Not require registration of the stock in State A.
Require the issuer to perform notice filing.
Require the issuer to pay a fee.
Investigate the underwriter for possible fraud in connection with the offering. -
CORRECT ANSWER-I and IV only
Securities that are listed on a national exchange (e.g., Nasdaq, NYSE, or AMEX)
are referred to as federal covered securities and, therefore, are not required to be
registered at the state level. Additionally, if the federal covered security is listed on
an exchange, the state may not require the issuer to pay a fee, submit a notice
filing, or provide a consent to service of process. However, the state Administrator
may investigate any broker-dealer (including the underwriter) that participates in
the offering for fraud or deceit and file an enforcement action if it is warranted.
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED
Questions and Answers 100% PASS
Securities that are registered through qualification may only be sold: - CORRECT
ANSWER-Once the registration is declared effective by the Administrator
Securities that are registered through qualification may be sold once the registration
is declared effective by the Administrator. Note that in choice (c), the use of the
term approved is inappropriate. Securities that are deemed effective for sale by an
Administrator may not be described as having been approved by the
Administrator.
The difference between a corporation's current assets and its current liabilities is
the: - CORRECT ANSWER-Working capital
The amount by which a corporation's current assets exceed its current liabilities is
referred to as working capital.
Assuming an expected rate of return, a specific holding period, and a sum to be
invested, an IAR is able to determine an investment's: - CORRECT ANSWER-
Future value
The future value of an investment is based on the present value of the amount
invested, using a discount rate each year, and doing so over a given period of time.
,The assumption is that the annual return is reinvested at the same rate, or is
compounded over the given time period, thereby resulting in a future value that
exceeds the present value.
Which of the following types of risk is MOST associated with the purchase of a
five-year T-bond? - CORRECT ANSWER-Interest-rate
Interest-rate risk, which is also referred to as money-rate risk, is essentially the risk
that if interest rates rise, the prices of the debt securities will fall. If an investor
needs to liquidate her debt investment prior to maturity, rising interest rates reduce
the value she would receive if she sold the security in the secondary market. Market
risk is primarily associated with common stock. Since the secondary market for
Treasuries is very active, liquidity risk is not a factor. Although legislative risk
(changes in the law) could create diminished value for the instruments, it is not
likely to occur.
Disadvantages of investing in a C Corporation include which of the following
choices?
Shareholders are taxed on dividends that they receive.
The corporation is taxed on its income.
Shareholders may not deduct their share of the corporation's losses on their
personal tax returns.
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED
,Shareholders are paid last if the corporation liquidates. - CORRECT ANSWER-I,
II, III, and IV
All of the choices are disadvantages of investing in a C Corporation
All the following are characteristics of passive asset allocation strategies, EXCEPT:
- CORRECT ANSWER-Altering a portfolio in anticipation of an economic event
A passive asset allocation strategy (e.g., buy and hold) is characterized by low
transaction costs and minimal tax consequences. Systematic rebalancing, another
passive strategy, alters the portfolio on a monthly, quarterly, or annual basis to
restore an original strategic asset allocation if market movements have changed it.
On the other hand, active (tactical) asset allocation strategies effect changes to a
portfolio's allocation in anticipation of economic events.
A person has established an IA as a sole proprietorship and works as an IAR out
of his home office. To help promote and manage the IA, he has set up a website
which contains personal information about his clients. A few weeks after setting up
the website, the IAR discovers that the website has been hacked and his customers'
account information has been stolen. What is the primary regulatory concern? -
CORRECT ANSWER-The IA did not prepare proper cybersecurity policies,
procedures, and measures before launching the website.
Both the SEC and state Administrators require IAs to establish cybersecurity
policies in order to protect their clients. Since the website was hacked, the
regulator's primary concern is the extent of the IA's cybersecurity measures. The
, regulations don't require websites to be password protected, despite the fact that
many IAs may find them necessary to protect client information. Also, there's no
requirement for an IA to be federally covered before creating a website. Although
websites are considered advertisements and regulators must be notified, it's
unlikely that this is the primary regulatory concern.
A Nasdaq listed company is offering 1,000,000 shares of common stock in State A.
The Administrator in State A may:
Not require registration of the stock in State A.
Require the issuer to perform notice filing.
Require the issuer to pay a fee.
Investigate the underwriter for possible fraud in connection with the offering. -
CORRECT ANSWER-I and IV only
Securities that are listed on a national exchange (e.g., Nasdaq, NYSE, or AMEX)
are referred to as federal covered securities and, therefore, are not required to be
registered at the state level. Additionally, if the federal covered security is listed on
an exchange, the state may not require the issuer to pay a fee, submit a notice
filing, or provide a consent to service of process. However, the state Administrator
may investigate any broker-dealer (including the underwriter) that participates in
the offering for fraud or deceit and file an enforcement action if it is warranted.
COPYRIGHT ©️ 2025 ALL RIGHTS RESERVED
