Series 65 Questions with Correct Answers
Who is an Investment Advisor Correct Answer-The Uniform Securities
Act defines any individuals associated with an investment adviser as
investment adviser representatives if they manage accounts or portfolios,
determine securities recommendations, or supervise personnel engaged
in the above activities, including any partner, officer, or director who
offers advice concerning securities. Persons who manage client accounts
or portfolios, determine securities recommendations, or supervise
personnel engaged in the above activities are investment adviser
representatives.
Matched Orders Correct Answer-Matched orders violate trading rules
because they create the illusion of trading volume where such volume
would not otherwise occur.
Prospectus Correct Answer--Tombstone advertisements are excluded
-must be in writing (ie email, etc)
-radio or television are prospectus
Tombstone Advertisements Correct Answer--Particular type of
advertisement appearing in newspaper or magazine. Typically
unadorned text (usually black on white)
Security without a "fixed" maturity date Correct Answer-Collateralized
Mortgage Obligations (CMO's). often paid off ahead of the scheduled
maturity so the maturity date remains uncertain. The operative word is
"fixed"; as opposed to "scheduled".
, Primary vs Secondary Correct Answer-A primary issue is a new offering
of securities by an issuer sold to investors. Transactions between two
investors in the over-the-counter market refer to secondary transactions
(the market between investors). A sale between investors of securities
traded on the New York Stock Exchange is another example of a
secondary transaction.
Discretionary Authority Correct Answer-Discretionary authority must be
in written form. The only exception is when the discretion relates to time
and/or price because, under the law, that is not considered to be
discretion.
Closed End Investment Company Correct Answer-A) it sells at the
market price plus a commission.
B) it differs from a mutual fund.
C) it is a type of management company.
D) it may not redeem its own shares.
Closed-end funds can, and often do, trade below their net asset value,
thus subjecting the customer's principal to risk.
Ginnie Maes Correct Answer-Direct obligation of US Gov't. Backed by
full faith and credit of gov't. Only GNMA n0t FNMA
OTC Market - meaning Correct Answer-The term "over the counter"
means a trading location anywhere other than on an exchange.
Who is an Investment Advisor Correct Answer-The Uniform Securities
Act defines any individuals associated with an investment adviser as
investment adviser representatives if they manage accounts or portfolios,
determine securities recommendations, or supervise personnel engaged
in the above activities, including any partner, officer, or director who
offers advice concerning securities. Persons who manage client accounts
or portfolios, determine securities recommendations, or supervise
personnel engaged in the above activities are investment adviser
representatives.
Matched Orders Correct Answer-Matched orders violate trading rules
because they create the illusion of trading volume where such volume
would not otherwise occur.
Prospectus Correct Answer--Tombstone advertisements are excluded
-must be in writing (ie email, etc)
-radio or television are prospectus
Tombstone Advertisements Correct Answer--Particular type of
advertisement appearing in newspaper or magazine. Typically
unadorned text (usually black on white)
Security without a "fixed" maturity date Correct Answer-Collateralized
Mortgage Obligations (CMO's). often paid off ahead of the scheduled
maturity so the maturity date remains uncertain. The operative word is
"fixed"; as opposed to "scheduled".
, Primary vs Secondary Correct Answer-A primary issue is a new offering
of securities by an issuer sold to investors. Transactions between two
investors in the over-the-counter market refer to secondary transactions
(the market between investors). A sale between investors of securities
traded on the New York Stock Exchange is another example of a
secondary transaction.
Discretionary Authority Correct Answer-Discretionary authority must be
in written form. The only exception is when the discretion relates to time
and/or price because, under the law, that is not considered to be
discretion.
Closed End Investment Company Correct Answer-A) it sells at the
market price plus a commission.
B) it differs from a mutual fund.
C) it is a type of management company.
D) it may not redeem its own shares.
Closed-end funds can, and often do, trade below their net asset value,
thus subjecting the customer's principal to risk.
Ginnie Maes Correct Answer-Direct obligation of US Gov't. Backed by
full faith and credit of gov't. Only GNMA n0t FNMA
OTC Market - meaning Correct Answer-The term "over the counter"
means a trading location anywhere other than on an exchange.
