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Question 1 of 10
1. Question
Which of the following statement(s) is (are) true about the Qualification examinations and waiver of requirements?
I. Qualification Examinations are a series of questions based on topic outlines from the Association.
II. Results from Qualification Examinations are given to the member firms.
III. NASD may waive the requirement of a Qualification Examination in lieu of other standard acceptable as proof of qualification.
IV. If a person fails the examination, he may take it again after 60 days, unless he has failed three times, in which case he must wait a period of 180 days.Correct
Qualification examinations and waiver of requirements (NASD Rule 1070) – Qualification Examinations are a series of questions based on topic outlines from the Association. Results from such examinations are given to the member firms. In certain cases, NASD may waive the requirement of a Qualification Examination in lieu of other standard acceptable as proof of qualification. If a person fails the examination, he may take it again after 30 days, unless he has failed three times, in which case he must wait a period of 180 days.
Incorrect
Qualification examinations and waiver of requirements (NASD Rule 1070) – Qualification Examinations are a series of questions based on topic outlines from the Association. Results from such examinations are given to the member firms. In certain cases, NASD may waive the requirement of a Qualification Examination in lieu of other standard acceptable as proof of qualification. If a person fails the examination, he may take it again after 30 days, unless he has failed three times, in which case he must wait a period of 180 days.
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Question 2 of 10
2. Question
Pursuant to NASD Rule 3010 Supervision- “Each member shall conduct a review of the businesses at least ___”
Correct
Pursuant to NASD Rule 3010 Supervision, “Each member shall conduct a review, at least annually, of the businesses.
Incorrect
Pursuant to NASD Rule 3010 Supervision, “Each member shall conduct a review, at least annually, of the businesses.
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Question 3 of 10
3. Question
As outlined in Section 30 of the Investment Company Act of 1940, which of the following(s) must be provided periodically by registered investment companies?
Registered investment companies must periodically provide-
I. such information, documents, and reports as the Commission may require to keep reasonably current the information and documents in the registration statement of such company.
II. copies of every periodic or interim report or similar communication containing financial statements and transmitted to any class of such company’s security holders within 10 days of such transmission.
III. reports to the company’s shareholders at least semiannually containing a balance sheet, amounts and values of securities owned, an income statement, a surplus statement, a report of all remuneration paid to directors and officers.
IV. review and endorsement of customer orders.Correct
As outlined in Section 30 of the Investment Company Act of 1940, registered investment companies must periodically provide the following:
i. such information, documents, and reports as the Commission may require to keep reasonably current the information and documents in the registration statement of such company
ii. copies of every periodic or interim report or similar communication containing financial statements and transmitted to any class of such company’s security holders within 10 days of such transmission
iii. reports to the company’s shareholders at least semiannually containing a balance sheet, amounts and values of securities owned, an income statement, a surplus statement, a report of all remuneration paid to directors and officers, and a statement of the aggregate purchases and sales of investment securities made during the reporting period.Incorrect
As outlined in Section 30 of the Investment Company Act of 1940, registered investment companies must periodically provide the following:
i. such information, documents, and reports as the Commission may require to keep reasonably current the information and documents in the registration statement of such company
ii. copies of every periodic or interim report or similar communication containing financial statements and transmitted to any class of such company’s security holders within 10 days of such transmission
iii. reports to the company’s shareholders at least semiannually containing a balance sheet, amounts and values of securities owned, an income statement, a surplus statement, a report of all remuneration paid to directors and officers, and a statement of the aggregate purchases and sales of investment securities made during the reporting period. -
Question 4 of 10
4. Question
Under Rule 17(f)(2) of the Securities Exchange Act of 1934, who are not required to be fingerprinted?
I. Employees who are not engaged in the sale of securities
II. Employees who do not have regular access to securities or cash
III. Employees who do not regularly process securities or cash
IV. Employees who do not have direct supervisory responsibility for employees of every member of a national securities exchange, broker, dealer, registered transfer agent, and registered clearing agency.Correct
Under Rule 17(f)(2) of the Securities Exchange Act of 1934, all partners, directors, officers, and employees of every member of a national securities exchange, broker, dealer, registered transfer agent, and registered clearing agency are required to be fingerprinted. The fingerprints are submitted to the United States Attorney General to be processed and maintained on file. There are some exceptions to this rule, however, such as employees who are not engaged in the sale of securities, employees who do not have regular access or do not regularly process securities or cash, and employees who do not have direct supervisory responsibility for employees with the responsibilities previously described.
Incorrect
Under Rule 17(f)(2) of the Securities Exchange Act of 1934, all partners, directors, officers, and employees of every member of a national securities exchange, broker, dealer, registered transfer agent, and registered clearing agency are required to be fingerprinted. The fingerprints are submitted to the United States Attorney General to be processed and maintained on file. There are some exceptions to this rule, however, such as employees who are not engaged in the sale of securities, employees who do not have regular access or do not regularly process securities or cash, and employees who do not have direct supervisory responsibility for employees with the responsibilities previously described.
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Question 5 of 10
5. Question
Investment Advisers Act of 1940 was largely the result of –
Correct
Investment Advisers Act of 1940
The Act was largely the result of the stock market crash in 1929, which wiped out the savings of millions.Incorrect
Investment Advisers Act of 1940
The Act was largely the result of the stock market crash in 1929, which wiped out the savings of millions. -
Question 6 of 10
6. Question
Which of the following is (are) not included to the definition of Investment adviser?
I. A bank or bank-holding company
II. Any nationally recognized statistical rating organization
III. Any family office
IV. Anyone else as designated by the Securities Exchange CommissionCorrect
The definition of Investment adviser does not include:
1. A bank or bank-holding company
2. Any nationally recognized statistical rating organization
3. Any family office
4. Anyone else as designated by the Securities Exchange CommissionIncorrect
The definition of Investment adviser does not include:
1. A bank or bank-holding company
2. Any nationally recognized statistical rating organization
3. Any family office
4. Anyone else as designated by the Securities Exchange Commission -
Question 7 of 10
7. Question
Who of the following person(s) is (are) not considered to be persons associated with an investment adviser?
I. Those employees of an investment adviser who serve in only ministerial roles
II. Those employees of an investment adviser who serve in only clerical roles
III. Any person directly controlling or controlled by such investment adviser including any employee of such investment adviser
IV. Any person indirectly controlling or controlled by such investment adviser including any employee of such investment adviserCorrect
According to the Investment Advisers Act of 1940, person associated with an investment adviser shall refer to “any partner, officer, or director of such investment adviser (or any person performing similar functions), or any person directly or indirectly controlling or controlled by such investment adviser, including any employee of such investment adviser.” It is important to note that those employees of an investment adviser who serve in only clerical or ministerial roles are not considered to be persons associated with an investment adviser.
Incorrect
According to the Investment Advisers Act of 1940, person associated with an investment adviser shall refer to “any partner, officer, or director of such investment adviser (or any person performing similar functions), or any person directly or indirectly controlling or controlled by such investment adviser, including any employee of such investment adviser.” It is important to note that those employees of an investment adviser who serve in only clerical or ministerial roles are not considered to be persons associated with an investment adviser.
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Question 8 of 10
8. Question
According to the Securities Act of 1933, which of the following information must be provided for the registration?
I. A description of the issuer’s business
II. A description of the security being marketed
III. Information regarding the issuer’s management team
IV. Certified financial statements of the issuerCorrect
The Securities Act of 1933
Some of the information that must be provided for the registration includes a description of the issuer’s business, a description of thesecurity being marketed, information regarding the issuer’s management team, and certified financial statements of the issuer.Incorrect
The Securities Act of 1933
Some of the information that must be provided for the registration includes a description of the issuer’s business, a description of thesecurity being marketed, information regarding the issuer’s management team, and certified financial statements of the issuer. -
Question 9 of 10
9. Question
Which of the following minimal level of information is (are) required to the investment decision-making process?
I. A mutual fund’s objectives
II. Strategy
III. Fees and expenses
IV. Present performanceCorrect
The purpose of the prospectus is to ensure that investors have access and are provided with, prior to the purchase of a security, a minimal level of information that is necessary for the investment decision-making process. Such information within the prospectus includes a mutual fund’s objectives, strategy, risks, fees and expenses, and past performance.
Incorrect
The purpose of the prospectus is to ensure that investors have access and are provided with, prior to the purchase of a security, a minimal level of information that is necessary for the investment decision-making process. Such information within the prospectus includes a mutual fund’s objectives, strategy, risks, fees and expenses, and past performance.
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Question 10 of 10
10. Question
Which of the following is (are) included in the Statement of Additional Information?
I. Detailed information about the fund’s investment advisers
II. Information relating to the purchasing and redemption of shares
III. Risks
IV. Past performanceCorrect
The Statement of Additional Information is meant to provide additional information to assist in the investment-making decision that is not typically available, or required to be contained, within the prospectus. Such information may include detailed information about the fund’s investment advisers and information relating to the purchasing and redemption of shares.
Incorrect
The Statement of Additional Information is meant to provide additional information to assist in the investment-making decision that is not typically available, or required to be contained, within the prospectus. Such information may include detailed information about the fund’s investment advisers and information relating to the purchasing and redemption of shares.