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Question 1 of 10
1. Question
What is any business day on which deliveries of securities and payments of money may be made through the facilities of a registered clearing agency called?
Correct
In the context of ‘Short Sale Delivery Requirements’ (FINRA Rule 4320), the term “settlement day” is usually defined as any business day on which deliveries of securities and payments of money may be made through the facilities of a registered clearing agency.
Incorrect
In the context of ‘Short Sale Delivery Requirements’ (FINRA Rule 4320), the term “settlement day” is usually defined as any business day on which deliveries of securities and payments of money may be made through the facilities of a registered clearing agency.
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Question 2 of 10
2. Question
According to ‘Short Sale Delivery Requirements’ (FINRA Rule 4320), when shall the participant immediately thereafter close out the fail to deliver position by purchasing securities of like kind and quantity?
Correct
According to ‘Short Sale Delivery Requirements’ (FINRA Rule 4320), if a participant of a registered clearing agency fails to deliver position at a registered clearing agency in a non-reporting threshold security for 13 CONSECUTIVE SETTLEMENT DAYS, the participant shall immediately thereafter close out the fail to deliver position by purchasing securities of like kind and quantity.
Incorrect
According to ‘Short Sale Delivery Requirements’ (FINRA Rule 4320), if a participant of a registered clearing agency fails to deliver position at a registered clearing agency in a non-reporting threshold security for 13 CONSECUTIVE SETTLEMENT DAYS, the participant shall immediately thereafter close out the fail to deliver position by purchasing securities of like kind and quantity.
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Question 3 of 10
3. Question
According to ‘Customer Confirmations’ (FINRA Rule 2232), which of the following shall mean a “corporate debt security”?
Correct
According to ‘Customer Confirmations’ (FINRA Rule 2232), a debt security that is United States (“U.S.”) dollar-denominated and issued by a U.S. or foreign private issuer and, if a “restricted security” sold pursuant to Securities Act Rule 144A, but does not include a Money Market Instrument shall mean a “corporate debt security”
Incorrect
According to ‘Customer Confirmations’ (FINRA Rule 2232), a debt security that is United States (“U.S.”) dollar-denominated and issued by a U.S. or foreign private issuer and, if a “restricted security” sold pursuant to Securities Act Rule 144A, but does not include a Money Market Instrument shall mean a “corporate debt security”
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Question 4 of 10
4. Question
According to ‘Customer Confirmations’ (FINRA Rule 2232), what is the name of a transaction that was conducted through a competitive process in which non-affiliate firms could also participate, and where the affiliate relationship did not influence the price paid or proceeds received by the member?
Correct
For the purposes of Customer Confirmations’ (FINRA Rule 2232), “arms-length transaction” shall mean a transaction:
-that was conducted through a competitive process in which non-affiliate firms could also participate, and;
-where the affiliate relationship did not influence the price paid or proceeds received by the memberIncorrect
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Question 5 of 10
5. Question
Broker-Dealer Personnel includes all of these except?
Correct
Broker-Dealer Personnel includes:
(i) Any officer, director, general partner, associated person or employee of a member or any other broker-dealer (other than a limited business broker-dealer);
(ii) Any agent of a member or any other broker-dealer (other than a limited business broker-dealer) that is engaged in the investment banking or securities business; or
(iii) An immediate family member of a person specified in (i) and (ii) such that he/she:
a. materially supports, or receives material support from, the immediate family member;
b. is employed by or associated with the member, or an affiliate of the member, selling the new issue to the immediate family member; or
c. has an ability to control the allocation of the new issue.Incorrect
Broker-Dealer Personnel includes:
(i) Any officer, director, general partner, associated person or employee of a member or any other broker-dealer (other than a limited business broker-dealer);
(ii) Any agent of a member or any other broker-dealer (other than a limited business broker-dealer) that is engaged in the investment banking or securities business; or
(iii) An immediate family member of a person specified in (i) and (ii) such that he/she:
a. materially supports, or receives material support from, the immediate family member;
b. is employed by or associated with the member, or an affiliate of the member, selling the new issue to the immediate family member; or
c. has an ability to control the allocation of the new issue. -
Question 6 of 10
6. Question
Any person who has authority to buy or sell securities for a bank, savings and loan institution, insurance company, investment company, investment advisor or collective investment account is called?
Correct
A Portfolio Managers is any person who has authority to buy or sell securities for a bank, savings and loan institution, insurance company, investment company, investment advisor or collective investment account
OR
An immediate family member of a person specified in the above statement that materially supports, or receives material support from, such person.Incorrect
A Portfolio Managers is any person who has authority to buy or sell securities for a bank, savings and loan institution, insurance company, investment company, investment advisor or collective investment account
OR
An immediate family member of a person specified in the above statement that materially supports, or receives material support from, such person. -
Question 7 of 10
7. Question
The book-running managing underwriter of a new issue shall be required to file which of the following information in the time and manner specified by FINRA with respect to new issues?
Correct
The book-running managing underwriter of a new issue shall be required to file the following information in the time and manner specified by FINRA with respect to new issues:
(1) the initial list of distribution participants and their underwriting commitment and retention amounts on or before the offering date; and
(2) the final list of distribution participants and their underwriting commitment and retention amounts no later than three business days after the offering date.Incorrect
The book-running managing underwriter of a new issue shall be required to file the following information in the time and manner specified by FINRA with respect to new issues:
(1) the initial list of distribution participants and their underwriting commitment and retention amounts on or before the offering date; and
(2) the final list of distribution participants and their underwriting commitment and retention amounts no later than three business days after the offering date. -
Question 8 of 10
8. Question
According to ‘Trading Ahead of Research Reports’ (FINRA Rule 5280), to restrict or limit the information flow between research department personnel, or other persons with knowledge of the content or timing of a research report, and trading department personnel, what should a member do?
Correct
A member must ESTABLISH, MAINTAIN AND ENFORCE policies and procedures reasonably designed to restrict or limit the information flow between research department personnel, or other persons with knowledge of the content or timing of a research report, and trading department personnel, so as to prevent trading department personnel from utilizing non-public advance knowledge of the issuance or content of a research report for the benefit of the member or any other person.
Incorrect
A member must ESTABLISH, MAINTAIN AND ENFORCE policies and procedures reasonably designed to restrict or limit the information flow between research department personnel, or other persons with knowledge of the content or timing of a research report, and trading department personnel, so as to prevent trading department personnel from utilizing non-public advance knowledge of the issuance or content of a research report for the benefit of the member or any other person.
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Question 9 of 10
9. Question
According to ‘Best Execution and Inter-positioning'(FINRA Rule 5310), which of the followings in NOT a factor that will be considered in determining whether a member has used “reasonable diligence”?
Correct
According to ‘Best Execution and Inter-positioning'(FINRA Rule 5310), following factors will be considered in determining whether a member has used “reasonable diligence”:
-The Market’s character for the security (e.g., price, volatility, relative liquidity, and pressure on available communications)
-Transaction size and type
-Quotation accessiblity
-Markets number checked
-The terms and conditions of the order which result in the transaction, as communicated to the member and persons associated with the member.Incorrect
According to ‘Best Execution and Inter-positioning'(FINRA Rule 5310), following factors will be considered in determining whether a member has used “reasonable diligence”:
-The Market’s character for the security (e.g., price, volatility, relative liquidity, and pressure on available communications)
-Transaction size and type
-Quotation accessiblity
-Markets number checked
-The terms and conditions of the order which result in the transaction, as communicated to the member and persons associated with the member. -
Question 10 of 10
10. Question
According to ‘Best Execution and Inter-positioning'(FINRA Rule 5310), what happens when a member cannot execute directly with a market but must employ a broker’s broker or some other means in order to ensure an execution advantageous to the customer?
Correct
When such a situation occurs that in order to ensure an execution advantageous to the customer, a member cannot execute directly with a market but must employ a broker’s broker or some other means then the burden of showing the acceptable circumstances for doing so is on the member.
Incorrect
When such a situation occurs that in order to ensure an execution advantageous to the customer, a member cannot execute directly with a market but must employ a broker’s broker or some other means then the burden of showing the acceptable circumstances for doing so is on the member.