SIE Quick Quiz 3a-3c

How long must a BD hold the record of a complaint?

4 years

A stock is purchased on June 10 of this year and sold on January 10 of next year for a profit of $200. How will the $200 be taxed?

As a short-term capital gain, taxed at the ordinary income tax rate

ABC stock is currently trading at $63. Julia Miller would like to purchase ABC stock, but not at $63. If the price of ABC stock were to fall to $58 or less, then Miller wants to buy the stock. Which type of order should Miller place considering her objective?

Buy limit

What is entering orders designed to keep a stock from rising

Capping

What is important to remember for trade confirmations?

Commissions are not shown when a markup or markdown is charged. The firms acting capacity as agent or principal is shown. They are received by both parties at or before the settlement date

A wealthy individual has established a t rust and wishes to establish an account with your BO that permits the trust to engage in margin transactions. Which of the following statements regarding margin trading in trust accounts is TRUE?

It is permitted if provided for in the trust's documentation.

Is whole life insurance a legal investment?

NO

Would the number of bonds be included in the confirmation of a trade?

NO becuase when bonds are involved the par value is indicated

A joint trading account can be created and profits and losses shared between which of the following parties?

RR and mother-in-law, and only the mother-in-law has contributed to the account

A customer has returned a signed proxy statement for stock held in street name by a member firm. He did not indicate how he wanted to vote for any issues listed on his ballot. What action, if any, is required of the member firm?

The firm must vote in accordance with the recommendations made by the issuer of the stock.

A client of a brokerage firm opened an UTMA account for her granddaughter 5 years ago, naming the child's father as the custodian. Through appreciation as well as additional contributions, the account value has grown to $50,000, and generates interest and dividend income in excess of $3,000. Who bears the liability for the taxes on this income?

The granddaughter

Which of the following securities will settle regular way, T + 1?

Treausry bond

Many years ago, a client purchased 100 shares of ABC common stock. Due to stock splits, the customer's account now holds 500 shares of ABC. If the customer had the BD send out certificates for 200 of those shares in the mail, then what would happen?

a nontrade confirmation would have to be generated

Regarding a member firm 's continuing payment of commissions to a retired registered representative (RR) ,what is important to remember?

an agreement to pay continuing commissions to retired RRs must be in writing commissions may be paid to a representative's beneficiary or estate after death a member firm may pay continuing commissions to its retired RRs that are derived from accounts held for continuing customers, regardless of whether customer funds or securities are added to the accounts during retirement

An individual opens an account with your firm . She tells you that upon her death, she wants any assets in the account to be divided equally among her 3 children. She also wants the ability to change the allocation in the event that conditions change and one of the children is in greater need than the others, but she does not want to incur any significant legal expense. You would suggest that the account be opened

as an individual transfer on death (TOD) account

What is Placing orders to buy or sell stock ahead of orders that could move the market?

front running

What is falsely reporting trades that never occurred or entering orders to influence the closing price of a stock?

marking the close

What is transactions designed to give the illusion of increased activity or volume in a stock?

matching

How often must penny sotcks customer account statement be sent?

monthly

What is any activity intended to keep a stock price stable?

pegging

One of the concerns of a registered representative (RR) is complying with the anti-money laundering (AML) rules promulgated under the Bank Secrecy Act. There are several stages to money laundering, and it is generally agreed that the one where money laundering is most easily detected is what?

placement

What is perpetrating rumors to push up the price of stock owned so as to profit later when selling?

pump and dump