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Question 1 of 10
1. Question
Which of the following is true?
Correct
According to FINRA rule 4210, If there is no closing price, a member may use a reasonable estimate of the market value of the security as of the close of business on the preceding business day.
Incorrect
According to FINRA rule 4210, If there is no closing price, a member may use a reasonable estimate of the market value of the security as of the close of business on the preceding business day.
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Question 2 of 10
2. Question
What type of option issue states any excess of the current value of the underlying principal amount over the aggregate exercise price of the option?
Correct
According to FINRA rule 4210, U.S. Government mortgage related or corporate debt securities options is any excess of the current value of the underlying principal amount over the aggregate exercise price of the option. While Index stock group options is any excess of the product of the index group value and the applicable multiplier over the aggregate exercise price of the option. stock option is any excess of the current market value of the equivalent number of shares of the underlying security over the aggregate exercise price of the option., and Broad index stock group the product of the index group value and the applicable index multiplier
Incorrect
According to FINRA rule 4210, U.S. Government mortgage related or corporate debt securities options is any excess of the current value of the underlying principal amount over the aggregate exercise price of the option. While Index stock group options is any excess of the product of the index group value and the applicable multiplier over the aggregate exercise price of the option. stock option is any excess of the current market value of the equivalent number of shares of the underlying security over the aggregate exercise price of the option., and Broad index stock group the product of the index group value and the applicable index multiplier
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Question 3 of 10
3. Question
Which of the following are issued highly rated foreign sovereign debt securities?
I. Issued or guaranteed by the government of a foreign country
II. Issued or guaranteed by its provinces
III. Issued or guaranteed by state or cities
IV. Issued or guaranteed by personCorrect
According FINRA rule 4210, the following are issued highly rated foreign sovereign debt securities:
(a) Issued or guaranteed by the government of a foreign country
(b) Issued or guaranteed by its provinces
(c) Issued or guaranteed by state or citiesIncorrect
According FINRA rule 4210, the following are issued highly rated foreign sovereign debt securities:
(a) Issued or guaranteed by the government of a foreign country
(b) Issued or guaranteed by its provinces
(c) Issued or guaranteed by state or cities -
Question 4 of 10
4. Question
Which of the following requirements of any debt securities not traded on a national securities exchange meeting?
I. At the time of the extensions of credit, the creditor has a reasonable basis for believing that the issuer is not in default on interest or principal payments
II. At the time of the original issue, a principal amount of not less than $25 million of the issue was outstanding
III. The issue was registered under Section 5 of the Securities Act and the issuer either files periodic reports pursuant to Section 13(a) or 15(d) of the Exchange Act or is an insurance company which meets all of the conditions specified in Section 12(g)(2)(G) of the Exchange Act
IV. At the time of the original issue, a principal amount of not less than $50 million of the issue was outstandingCorrect
According to FINRA rule 4210 the following requirements of any debt securities not traded on a national securities exchange meeting:
(a) At the time of the extensions of credit, the creditor has a reasonable basis for believing that the issuer is not in default on interest or principal payments
(b) At the time of the original issue, a principal amount of not less than $25 million of the issue was outstanding
(c) The issue was registered under Section 5 of the Securities Act and the issuer either files periodic reports pursuant to Section 13(a) or 15(d) of the Exchange Act or is an insurance company which meets all of the conditions specified in Section 12(g)(2)(G) of the Exchange ActIncorrect
According to FINRA rule 4210 the following requirements of any debt securities not traded on a national securities exchange meeting:
(a) At the time of the extensions of credit, the creditor has a reasonable basis for believing that the issuer is not in default on interest or principal payments
(b) At the time of the original issue, a principal amount of not less than $25 million of the issue was outstanding
(c) The issue was registered under Section 5 of the Securities Act and the issuer either files periodic reports pursuant to Section 13(a) or 15(d) of the Exchange Act or is an insurance company which meets all of the conditions specified in Section 12(g)(2)(G) of the Exchange Act -
Question 5 of 10
5. Question
Which of the following requirement for the purpose of effecting new securities transactions and commitments for the customer shall be required to deposit margin in cash and/or securities in the account which shall be at least the greater?
I. The amount specified in Regulation T, or Rules 400 through 406 of SEC Customer Margin Requirements for Security Futures, or Rules 41.42 through 41.49 under the Commodity Exchange Act (“CEA”)
II. The amount specified in paragraph (c) of this Rule
III. Such a greater amount as FINRA may from time to time require for specific securities
IV. Equity of at least $2,000 except that cash need not be deposited in excess of the cost of any security purchased (this equity and cost of purchase provision shall not apply to “when distributed” securities in a cash account)Correct
According to FINRA rule 4210, the following are the requirement for the purpose of effecting new securities transactions and commitments for the customer shall be required to deposit margin in cash and/or securities in the account which shall be at least the greater:
(a) The amount specified in Regulation T, or Rules 400 through 406 of SEC Customer Margin Requirements for Security Futures, or Rules 41.42 through 41.49 under the Commodity Exchange Act (“CEA”)
(b) The amount specified in paragraph (c) of this Rule
(c) Such a greater amount as FINRA may from time to time require for specific securities
(d) Equity of at least $2,000 except that cash need not be deposited in excess of the cost of any security purchased (this equity and cost of purchase provision shall not apply to “when distributed” securities in a cash account)Incorrect
According to FINRA rule 4210, the following are the requirement for the purpose of effecting new securities transactions and commitments for the customer shall be required to deposit margin in cash and/or securities in the account which shall be at least the greater:
(a) The amount specified in Regulation T, or Rules 400 through 406 of SEC Customer Margin Requirements for Security Futures, or Rules 41.42 through 41.49 under the Commodity Exchange Act (“CEA”)
(b) The amount specified in paragraph (c) of this Rule
(c) Such a greater amount as FINRA may from time to time require for specific securities
(d) Equity of at least $2,000 except that cash need not be deposited in excess of the cost of any security purchased (this equity and cost of purchase provision shall not apply to “when distributed” securities in a cash account) -
Question 6 of 10
6. Question
How much is the minimum requirement for pattern day trader?
Correct
According to FINRA rule 4210, the minimum requirement for pattern day trader is $25,000 not $ $15,000 , $20,000 and $ 50,000.
Incorrect
According to FINRA rule 4210, the minimum requirement for pattern day trader is $25,000 not $ $15,000 , $20,000 and $ 50,000.
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Question 7 of 10
7. Question
Which of the following is correct in any “long” or “short” positions in non-equity securities?
I. 10 percent of the current market value in the case of investment-grade debt securities; and
II. 20 percent of the current market value
III. 7 percent of the principal amount, whichever amount is greater, in the case of all other listed non-equity securities, and all other margin eligible non-equity securities
IV. 50 percent of the current market valueCorrect
According to FINRA rule 4210, On any “long” or “short” positions in non-equity securities, the margin to be maintained shall be:
(a)10 percent of the current market value in the case of investment-grade debt securities
(b) 20 percent of the current market value
(c) 7 percent of the principal amount, whichever amount is greater, in the case of all other listed non-equity securities, and all other margin eligible non-equity securitiesIncorrect
According to FINRA rule 4210, On any “long” or “short” positions in non-equity securities, the margin to be maintained shall be:
(a)10 percent of the current market value in the case of investment-grade debt securities
(b) 20 percent of the current market value
(c) 7 percent of the principal amount, whichever amount is greater, in the case of all other listed non-equity securities, and all other margin eligible non-equity securities -
Question 8 of 10
8. Question
What will happen to the margin if security carried in a “long” position is exchangeable or convertible within a reasonable time, without restriction other than the payment of money, into a security carried in a “short” position for the same customer?
Correct
According to FINRA rule 4210, The margin to be maintained on such positions shall be 10 percent if security carried in a “long” position is exchangeable or convertible within a reasonable time, without restriction other than the payment of money, into a security carried in a “short” position for the same customer.
Incorrect
According to FINRA rule 4210, The margin to be maintained on such positions shall be 10 percent if security carried in a “long” position is exchangeable or convertible within a reasonable time, without restriction other than the payment of money, into a security carried in a “short” position for the same customer.
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Question 9 of 10
9. Question
What will happen to the margin if the same security is carried “long” and “short” the margin to be maintained on such positions?
Correct
According to FINRA rule 4210, the margin shall be 5 percent of the current market value of the “long” securities if the same security is carried “long” and “short” the margin to be maintained on such positions.
Incorrect
According to FINRA rule 4210, the margin shall be 5 percent of the current market value of the “long” securities if the same security is carried “long” and “short” the margin to be maintained on such positions.
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Question 10 of 10
10. Question
Which of the following are the list included for the exemption application?
I. Approximate aggregate indebtedness
II. Approximate net capital
III. Approximate total liabilities
IV. Approximate total market valueCorrect
According to FINRA Rule 4210, the following are the list included for the exemption application:
(a) Approximate aggregate indebtedness
(b) Approximate net capital
(c) Approximate total market valueIncorrect
According to FINRA Rule 4210, the following are the list included for the exemption application:
(a) Approximate aggregate indebtedness
(b) Approximate net capital
(c) Approximate total market value