Securities Industry Essentials (SIE)

Issuers and Underwriters

(issuer) offer or propose securities for the purpose of raising capital. (underwriter)(sellers) BD or investment bankers who works with an issuer to bring securities to the market and sell them ~Populated by Quizlet

What is the lowest grade you can receive to still pass the SIE?

70% is the lowest you can go for a grade. (No Exceptions)

How many question are on the SIE?

75 + 10 Experimental ones that don't count towards your score. This means you need to answer a certain amount of these correctly to pass, but only of the 75. Can you guess the experimental ones? No? Then Study.

inflation

A continuous rise in the price of goods and services

Investment Advisor

A financial professional who manages investments and has been trained and licensed to do so. ~Populated by Quizlet

Income Statement

A financial statement showing the revenue and expenses for a fiscal period.

Balance Sheet

A financial statement that reports assets, liabilities, and owner's equity on a specific date.

Gross Domestic Product (GDP)

A measurement of the total goods and services produced within a country.

expansion

A period of economic growth as measured by a rise in real GDP

Transfer Agent

A person or corporation responsible for recording the names and holdings of registered security owners, seeing that certificates are signed by the appropriate corporate officers, affixing the corporate seal, and delivering securities to the new owners.

The Securities Exchange Act of 1934

An act that regulates the trading of securities such as stocks and bonds in the secondary market. ~ Populated answer from Quizlet

Traders and Market Makers

Any entity, individual or institution, willing to accept the risk of holding a particular security in its own account to facilitate trading and provide liquidity in that security ready to buy and or sell to become profitable

I have a disability. What do I do?

Before scheduling, call the center and see if there can be accommodations made. Discuss with them what can be afforded. Being there are absolutely no electronics allowed in the testing area and you studied with music...You might want to either talk with the center or take up a spot in a quiet library to study without your music or any other distraction.

Are their questions that will trip you up in this test?

Being this is one of the hardest tests and an expensive one at that, you can definitely expect to see questions that will trip you up. Open-Stemed, Closed-Stemed, Exceptions, and even qualifiers will be added to stump or throw you off. Some will even have diagrams for you to look at. READ EACH QUESTION CAREFULLY! ALSO, THIS IS A MULTIPLE-CHOICE EXAM. BEWARE!! ~ Some of this was quoted from "For Dummies" Book.

Bonds

Certificates of debt that carry a promise to buy back the bonds at a higher price

CBOE

Chicago Board Options Exchange

The Investment Company Act of 1940

Congressional legislation regulating companies that invest and reinvest in securities. The act requires an investment company engaged in interstate commerce to register with the SEC. Populated answer from Quizlet

FDIC

Federal Deposit Insurance Corporation

FINRA

Financial Industry Regulatory Authority

equity markets

Financial markets where corporate stocks are traded.

Monetary vs Fiscal Policy

Fiscal Policy: government efforts to influence the economy through taxation and spending Monetary Policy: Federal Reserve decisions that shape the economy by influencing interest rates and the supply of money

Which Federal Acts are in the test?

I suggest researching and learning the following: The Securities Act of 1933 The Securities Exchange Act of 1934 The Investment Company Act of 1940 The Investment Adviser Act of 1940

federal funds rate

Interest rate banks charge each other for loans

IRS

Internal Revenue Service

Forth market

Market for institutional investors in which large blocks of stock, listed and unlisted, trade in transactions UNASSISTED BY BD's. Open 24 hours a day through ECN (electronic communications network).

MSRB

Municipal Securities Rulemaking Board

NASAA

North American Securities Administrators Association

interest rate

Percentage of amount borrowed to be added to the amount loaned and paid back

SIE

Securities Industry Essentials

SIPC

Securities Investor Protection Corporation

SROs

Self-Regulatory Organizations

What are the allocations of this test?

Study these sections: 1. Knowledge of Capital Markets (16% or 12 items) 2. Understanding Products and their Risks (44% or 33 items) 3. Understanding trading, Customer account, and Prohibited Activities (31% or 23 Items) 4. Overview of the Regulatory Framework (9% or 7 items) Making a grand total of 100% or 75 items (Meaning this is the stuff you should be studying for.) Also, be aware that these are randomly Distributed questions.

SEC

The Securities and Exchange Commission

The Securities Act of 1933

The first major federal law regulating the securities industry. It requires firms issuing new stock in a public offering to file a registration statement with the SEC. ~ Populated answer from Quizlet

Monetarist Theory

The idea that the amount of money in circulation (the money supply) is the primary influence on economic activity and inflation.

discount rate

The interest rate on the loans that the Fed makes to banks

exchange rate

The measure of how much one currency is worth in relation to another.

Keynesian economic theory

The theory emphasizing that government spending and deficits can help the economy weather its normal ups and downs. Proponents of this theory advocate using the power of government to stimulate the economy when it is lagging.

Gross National Product (GNP)

The total value of all goods and services produced by a country's economy in a given year. It includes all goods and services produced by corporations and individuals of a country, whether or not they are located within the country.

The Investment Adviser Act of 1940

This law regulates investment advisers. With certain exceptions, this Act requires that firms or sole practitioners compensated for advising others about securities investments must register with the SEC and conform to regulations designed to protect investors. ~Pulled from Google.

YOU PASSED! Now What?

Within 120 days after your second anniversary and every three years after, you are to take a computer based exam covering regulatory elements at a Prometric Exam center. There is a requirement that requires broker-dealers to keep representatives updated on job and product related topics. ~Taken from "For Dummies" book

How long do I have to take the test?

You have approximately 1 hour and 45 minutes to complete the test. So make sure all those practice tests and late-night study sessions are firmly embedded in that memory. Please note: THIS IS NOT AN OPEN BOOK, NOR DO YOU HAVE THE OPTION OF HAVING A CHEAT CARD. THIS IS ALL FROM MEMORY.

YOU FAILED!! What Now?

You have the option of being able to retake the exam. However, you have to reschedule and pay for a new test date. This has to be scheduled 30 DAYS after the day you failed. If you fail the exam 3 TIMES, you have to wait a grand total of 6 months to try again. Note: This is 30 days you can study even harder to pass it the second time. Can't vouch for you if you fail three times.

contraction

a period of economic decline marked by falling real GDP

investor

a person who gives money to a company with the hope of making money later. ~Populated by Quizlet

Coincident

adj. Taking place at the same time.

Broker-Dealer

any person engaged in the business of effecting transactions in securities for the account of others or for his own account. ~Populated Answer from Quizlet

leading

creating a vision for the organization and guiding, training, coaching, and motivating others to work effectively to achieve the organization's goals and objectives

Custodians and Trustees

custodian - makes all the investment decisions for the minor trustees (fiduciary )

Third Market

exchange-listed stock traded OTC primarily by institutional investors

Lagging

hang back or fall behind in movement, progress, development

US balance of payments

if we are in a surplus or deficit -this all depends where the higher interest rates are(money flows to where its worth more) -the more we export the better we are, but then we'll start buying more and it will become a cycle

primary market

market for selling financial assets that can only be redeemed by the original holder

Municipal Advisor

person or firm that provides advice on behalf of a municipal entity or official with respect to municipal financial products or issuing municipal securities. ~Populated answer from Quizlet

Depositories and Clearing Corporations

receives and delivers payments for trades - National Securities Clearing Corp (NSCC) - Depository Trust & Clearing Corp (DTCC) - Options Clearing Corporation (OCC)

Peak

the height of an economic expansion, when real GDP stops rising

Trough

the lowest point of a transverse wave

secondary market

the market in which previously issued securities are traded among investors