Series 65 correct Answers Custom Exam
1
Which of the following may be advertised as a no-load fund?
A: A fund that assesses a 12b-1 fee of 0.25% of average net assets per year
B: A fund that assesses a 12b-1 fee of 0.25% of average total assets per year
C: A fund that assesses a back-end sales charge
D: A fund that assesses a front-end sales charge - correct answer ✔✔A: A fund that assesses a 12b-1 fee
of 0.25% of average net assets per year
An investment adviser is constructing a diversified portfolio for a client. If the client requires liquidity,
which of the following asset class would he least likely recommend?
BBB rated debt securities
Prime real estate
Equity securities traded OTC
Commodity option contracts - correct answer ✔✔Prime real estate
An investor purchases a newly issued 8% Treasury bond at par but earns only a 6% total return over the
next year. Which of the following is the MOST likely explanation for this?
The bond was called by the Treasury
The Treasury missed an interest payment
The market value of the bond declined by 2%
The purchaser did not reinvest the coupon payments - correct answer ✔✔The market value of the bond
declined by 2%
All of the following are associated with state standards for prudent investing by fiduciaries, EXCEPT:
, The prudent man standard
ERISA
Legal lists
The Uniform Prudent Investor Act - correct answer ✔✔ERISA
The third market is concerned with:
OTC equity securities trading on an exchange
Listed securities trading on an exchange
Securities listed on an exchange, but traded in the OTC market
Securities listed on an exchange that are traded directly between institutional investors - correct answer
✔✔Securities listed on an exchange, but traded in the OTC market
Which of the following is suitable for an investor who wants an investment that's marketable, highly
liquid, and provides income?
Certificate of deposit (CD)
Preferred stock
Auction-rate security
Index ETF - correct answer ✔✔Preferred Stock
Modern Portfolio Theory (MPT) defines risk as the:
Possibility of loss of principal
Possibility that returns will be less than the rate of inflation
Slope of the regression line of portfolio returns versus the market
Variability of expected returns about the mean - correct answer ✔✔Variability of expected returns about
the mean
1
Which of the following may be advertised as a no-load fund?
A: A fund that assesses a 12b-1 fee of 0.25% of average net assets per year
B: A fund that assesses a 12b-1 fee of 0.25% of average total assets per year
C: A fund that assesses a back-end sales charge
D: A fund that assesses a front-end sales charge - correct answer ✔✔A: A fund that assesses a 12b-1 fee
of 0.25% of average net assets per year
An investment adviser is constructing a diversified portfolio for a client. If the client requires liquidity,
which of the following asset class would he least likely recommend?
BBB rated debt securities
Prime real estate
Equity securities traded OTC
Commodity option contracts - correct answer ✔✔Prime real estate
An investor purchases a newly issued 8% Treasury bond at par but earns only a 6% total return over the
next year. Which of the following is the MOST likely explanation for this?
The bond was called by the Treasury
The Treasury missed an interest payment
The market value of the bond declined by 2%
The purchaser did not reinvest the coupon payments - correct answer ✔✔The market value of the bond
declined by 2%
All of the following are associated with state standards for prudent investing by fiduciaries, EXCEPT:
, The prudent man standard
ERISA
Legal lists
The Uniform Prudent Investor Act - correct answer ✔✔ERISA
The third market is concerned with:
OTC equity securities trading on an exchange
Listed securities trading on an exchange
Securities listed on an exchange, but traded in the OTC market
Securities listed on an exchange that are traded directly between institutional investors - correct answer
✔✔Securities listed on an exchange, but traded in the OTC market
Which of the following is suitable for an investor who wants an investment that's marketable, highly
liquid, and provides income?
Certificate of deposit (CD)
Preferred stock
Auction-rate security
Index ETF - correct answer ✔✔Preferred Stock
Modern Portfolio Theory (MPT) defines risk as the:
Possibility of loss of principal
Possibility that returns will be less than the rate of inflation
Slope of the regression line of portfolio returns versus the market
Variability of expected returns about the mean - correct answer ✔✔Variability of expected returns about
the mean
