Quiz-summary
0 of 10 questions completed
Questions:
- 1
- 2
- 3
- 4
- 5
- 6
- 7
- 8
- 9
- 10
Information
Free Practice Questions
You have already completed the quiz before. Hence you can not start it again.
Quiz is loading...
You must sign in or sign up to start the quiz.
You have to finish following quiz, to start this quiz:
Results
0 of 10 questions answered correctly
Your time:
Time has elapsed
You have reached 0 of 0 points, (0)
Categories
- Not categorized 0%
- 1
- 2
- 3
- 4
- 5
- 6
- 7
- 8
- 9
- 10
- Answered
- Review
-
Question 1 of 10
1. Question
Day Trading Risk Disclosure Statement (FINRA Rule 2270) includes the various risk disclosures. Which of the following is not included in the list:
Correct
The risks disclosures include: day trading is extremely risky; be cautious of claims of large profits from day trading; day trading requires knowledge of securities markets; day trading requires knowledge of a firm’s operations; day trading will generate substantial commissions, even if the per trade cost is low; day trading on margin or short selling may result in losses beyond your initial investment; and potential registration requirements.
Incorrect
The risks disclosures include: day trading is extremely risky; be cautious of claims of large profits from day trading; day trading requires knowledge of securities markets; day trading requires knowledge of a firm’s operations; day trading will generate substantial commissions, even if the per trade cost is low; day trading on margin or short selling may result in losses beyond your initial investment; and potential registration requirements.
-
Question 2 of 10
2. Question
Which of the following statements is (are) true regarding the Networking arrangements between members and financial institutions:
I. The member needs to be clearly identified
II. The services of the member should be distinguishable from the financial institution
III. The member should manage its services physically separate from the financial institution
IV. The member should have its name displayed where it conducts businessCorrect
Networking arrangements between members and financial institutions (FINRA Rule 3160) – a member that is a part of a networking agreement under which it conducts broker-dealer services on or off the premises of a financial institution is subject to the Rule. Setting – the member is to be clearly identified and have its services distinguished from the services of the financial institution, have its name displayed where it conducts business, and maintain its services physically separate from that of the financial institution if at all possible.
Incorrect
Networking arrangements between members and financial institutions (FINRA Rule 3160) – a member that is a part of a networking agreement under which it conducts broker-dealer services on or off the premises of a financial institution is subject to the Rule. Setting – the member is to be clearly identified and have its services distinguished from the services of the financial institution, have its name displayed where it conducts business, and maintain its services physically separate from that of the financial institution if at all possible.
-
Question 3 of 10
3. Question
Financial Industry Regulatory Authority (FINRA) Rules 4512 and 4515 describe the exact information about which of the following matter:
Correct
Customer account information- Financial Industry Regulatory Authority (FINRA) Rules 4512 and 4515 describe the exact information that a broker-dealer is required to have on file prior to opening an account for a new customer.
Incorrect
Customer account information- Financial Industry Regulatory Authority (FINRA) Rules 4512 and 4515 describe the exact information that a broker-dealer is required to have on file prior to opening an account for a new customer.
-
Question 4 of 10
4. Question
NASD Rule 3050 imposes obligations on which of the following party:
Correct
NASD Rule 3050 imposes certain obligations on associated persons who work with accounts that are owned by investment advisers, banks, or other financial institutions.
Incorrect
NASD Rule 3050 imposes certain obligations on associated persons who work with accounts that are owned by investment advisers, banks, or other financial institutions.
-
Question 5 of 10
5. Question
Which of the following comes under the responsibilities of the Associated Persons under the NASD Rule 3050:
I. They must notify their employer in writing related to transactions executions and account opening.
II. They must notify their customer in writing related to transactions executions and account opening.
III. They must provide the employer with duplicate copies of information about the account
IV. They must provide the customer with duplicate copies of information about the accountCorrect
Prior to opening the account or placing trades for one of the above customers, associated persons must notify their employer in writing of either the intent to execute the transactions or the intent to open the account. Additionally, the associated person must provide the customer with duplicate copies of confirmations, statements, or other information about the account or order upon the written request of either the customer or the associated person’s member firm. Finally, if the customer’s account was opened prior to the associated person’s association with the member firm, then the associated person must comply with this rule on an ongoing basis immediately upon their association.
Incorrect
Prior to opening the account or placing trades for one of the above customers, associated persons must notify their employer in writing of either the intent to execute the transactions or the intent to open the account. Additionally, the associated person must provide the customer with duplicate copies of confirmations, statements, or other information about the account or order upon the written request of either the customer or the associated person’s member firm. Finally, if the customer’s account was opened prior to the associated person’s association with the member firm, then the associated person must comply with this rule on an ongoing basis immediately upon their association.
-
Question 6 of 10
6. Question
Rule 405 created by NYSE relates to which of the following:
Correct
Rule 405, also endorsed by FINRA, requires that a representative gather enough information from the customer to make appropriate and suitable investment recommendations.
Incorrect
Rule 405, also endorsed by FINRA, requires that a representative gather enough information from the customer to make appropriate and suitable investment recommendations.
-
Question 7 of 10
7. Question
Regarding the FINRA Rule 2090, which of the following statement is true:
Correct
Know your customer (FINRA Rule 2090) – members of FINRA are to use reasonable diligence when opening and maintaining accounts for customers, and to get to know essential facts about the customer and concerning the authority of each person acting on behalf of a customer
Incorrect
Know your customer (FINRA Rule 2090) – members of FINRA are to use reasonable diligence when opening and maintaining accounts for customers, and to get to know essential facts about the customer and concerning the authority of each person acting on behalf of a customer
-
Question 8 of 10
8. Question
Who reviews the current financial statements and material business information of the issuer regarding the purchasing or short selling any OTC equity security:
Correct
No member is to recommend a customer purchase or sell short any OTC equity security unless the member has reviewed the current financial statements and material business information of the issuer and determined that the information provides a reasonable basis. The registered person designated to make this review is to be a General ecurities Principal or General Securities Sales Supervisor
Incorrect
No member is to recommend a customer purchase or sell short any OTC equity security unless the member has reviewed the current financial statements and material business information of the issuer and determined that the information provides a reasonable basis. The registered person designated to make this review is to be a General ecurities Principal or General Securities Sales Supervisor
-
Question 9 of 10
9. Question
Which of the following is true regarding the “member is not to sell investment company shares at a price below the point that the sales charge is reduced on quantity transactions in order to gain the applicable higher sales charges.”
Correct
Breakpoint sales (FINRA Rule 2342) – a member is not to sell investment company shares at a price below the point that the sales charge is reduced on quantity transactions in order to gain the applicable higher sales charges.
Incorrect
Breakpoint sales (FINRA Rule 2342) – a member is not to sell investment company shares at a price below the point that the sales charge is reduced on quantity transactions in order to gain the applicable higher sales charges.
-
Question 10 of 10
10. Question
Which of the following rule ensures the integrity of the capital markets and the confidence of retail investors that the markets are not “rigged” for the larger, institutional investors or those with critical inside information:
Correct
FINRA Rule 2020—Use of Manipulative, Deceptive or Other Fraudulent Devices states-The importance of this rule is in ensuring the integrity of the capital markets and the confidence of retail investors that the markets are not “rigged” for the larger, institutional investors or those with critical inside information.
Incorrect
FINRA Rule 2020—Use of Manipulative, Deceptive or Other Fraudulent Devices states-The importance of this rule is in ensuring the integrity of the capital markets and the confidence of retail investors that the markets are not “rigged” for the larger, institutional investors or those with critical inside information.