SIE Latest Exam Papers | SIE Latest Torrent
SIE Latest Exam Papers | SIE Latest Torrent
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FINRA Securities Industry Essentials Exam (SIE) Sample Questions (Q65-Q70):
NEW QUESTION # 65
Under which of the following circumstances, if any, is a member firm permitted to send gifts to registered representatives (RRs) of another member firm?
- A. Under no circumstance
- B. No single gift exceeds $100; maximum value of all gifts per RR per year is $200
- C. No single gift exceeds $100; no limit on the number of gifts
- D. Value of all gifts to an RR during a period of one year does not exceed $100
Answer: D
Explanation:
FINRA Rule 3220 prohibits member firms from giving gifts exceeding $100 per individual per year to ensure that gifts do not influence business conduct. The rule applies to gifts given in connection with the firm's business.
* C is correctbecause it adheres to FINRA's $100 annual limit.
* Ais incorrect because the total value of gifts must also not exceed $100 annually.
* Bis incorrect as there is no $200 limit.
* Dis incorrect as gifts are allowed within the $100 limit.
NEW QUESTION # 66
Which of the following statements is true of the writer of a listed equity call option?
- A. They have the right to buy stock at a fixed strike price.
- B. They have the obligation to sell stock at a fixed strike price.
- C. They have the right to sell stock at a fixed strike price.
- D. They have the obligation to buy stock at a fixed strike price.
Answer: B
Explanation:
Step by Step Explanation:
* Call Option Writer: When writing (selling) a call option, the writer has the obligation to sell the underlying stock at the strike price if the buyer exercises the option.
* Incorrect Options:
* A & B: Only the option buyer has rights, not the writer.
* D: Obligations to buy stock apply to put option writers, not call option writers.
References:
* Options Clearing Corporation (OCC) Options Education: OCC Options Education.
NEW QUESTION # 67
The formation of an asset-backed security or debt obligation that represents a claim on the cash flows from mortgage loans is known as:
- A. Securitization
- B. Hypothecation
- C. Claim processing
- D. Loan processing
Answer: A
Explanation:
Step by Step Explanation:
* Securitization: The process of pooling financial assets, such as mortgage loans, and creating asset- backed securities that investors can buy.
* Incorrect Options:
* B: Hypothecation refers to pledging assets as collateral.
* C & D: Loan and claim processing are administrative terms, not related to the creation of securities.
References:
* SEC Guidance on Asset-Backed Securities: SEC ABS Info.
NEW QUESTION # 68
If an investor is bullish on ABC, which of the following actions will he most likely take?
- A. Sell ABC stock short
- B. Buy ABC puts
- C. Buy ABC stock
- D. Sell ABC calls
Answer: C
Explanation:
Step by Step Explanation:
* Bullish Position: Buying ABC stock aligns with the expectation that the stock's price will rise, allowing the investor to profit.
* Incorrect Options:
* A: Buying puts is a bearish strategy.
* C: Selling calls benefits from stable or declining prices.
* D: Selling short is a bearish strategy anticipating a price drop.
References:
* FINRA Guidance on Market Strategies: FINRA Trading Basics.
NEW QUESTION # 69
The primary market is regulated by the SEC under which of the following acts?
- A. The Investment Company Act of 1940
- B. The Investment Advisers Act of 1940
- C. The Securities Exchange Act of 1934
- D. The Securities Act of 1933
Answer: D
Explanation:
The primary market deals with the issuance of new securities, which is regulated under the Securities Act of
1933. This act requires issuers to provide full disclosure of material information to investors to ensure transparency and fairness in new offerings.
* A is correctbecause the Securities Act of 1933 governs initial offerings.
* Bis incorrect because the Securities Exchange Act of 1934 regulates secondary market trading.
* Cis incorrect because the Investment Advisers Act of 1940 pertains to investment advisers.
* Dis incorrect because the Investment Company Act of 1940 governs mutual funds and other investment companies.
NEW QUESTION # 70
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