SIE Exam 2023
What is cost basis?
A
The original purchase price plus any transaction costs
B
The transaction charges affiliated with the purchase of any security
C
The net after-tax purchase price per share of common stock
D
The amount of any gain or loss if a different transaction had...
The original purchase price plus any transaction costs
B
The transaction charges affiliated with the purchase of any security
C
The net after-tax purchase price per share of common stock
D
The amount of any gain or loss if a different transaction had occurred - ANSWER-A. The original purchase
price plus any transaction costs
Which of the following corporate securities carries the greatest risk to the investor?
A
Commercial paper
B
Common stock
C
Preferred stock
D
Bonds - ANSWER-B. Common Stock
Which of the following is a characteristic of a frozen account?
A
The frozen status lasts for 90 days
,B
Purchases may not be made in the account
C
Frozen account status covers all accounts at the firm
D
Only margin accounts can have a frozen status - ANSWER-A. The frozen status lasts for 90 days
ABC insurance company has issued a variable annuity contract. The contract offers numerous investment
options, including subaccounts, which hold bonds, domestic equities, and foreign securities. Which of
the following risks does ABC incur when issuing this contract?
A
Mortality and currency risk
B
Mortality and expense risk
C
Currency and expense risk
D
Inflation and interest-rate risk - ANSWER-B
Mortality and expense risk
Which of the following is required to be maintained for three years?
A
Currency Transaction Reports
B
Instant messages
C
Customer account records
,D
Customer complaints - ANSWER-B
Instant messages
When is the final due diligence meeting held?
A
Just prior to the end of the cooling-off period
B
At the start of the cooling-off period
C
After the IPO
D
Prior to submitting the registration statement to the SEC - ANSWER-A
Just prior to the end of the cooling-off period
Private REITs are all the following, except:
A
Registered with the SEC
B
Have no disclosure requirements
C
Only suitable for wealthy investors
D
Usually offered as private placements - ANSWER-A
Registered with the SEC
Which of the following statements is true regarding secondary offerings?
, A
Sale proceeds go to the issuer
B
Shares are sold through an underwriter
C
Secondary offering transactions take place in the secondary market
D
They are considered a primary offering since the shares have already been issued - ANSWER-C
Secondary offering transactions take place in the secondary market
Which of the following remarks regarding Class B shares is unacceptable?
A
"A purchase of Class B shares is invested in the same underlying portfolio as A shares of the same fund"
B
"Class B shares do not qualify for breakpoints"
C
"Class B shares are considered a no-load if held beyond the surrender penalty date"
D
"Class B shares are subject to a contingent deferred sales charge" - ANSWER-C
"Class B shares are considered a no-load if held beyond the surrender penalty date"
What is a unique feature of a Roth IRA compared to a traditional IRA?
A
Tax-free distributions may be postponed beyond reaching the age of 72
B
Catch up provisions allow people age 50 or older to make contributions greater than the normal annual
maximum
C
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