100% satisfaction guarantee Immediately available after payment Both online and in PDF No strings attached
logo-home
Previously searched by you
Previously searched by you
logo
FINRA Series 7 Stimulated Exam 3 Questions and Answers | 100% Pass $12.49   Add to cart
Quickly navigate to
Preview
  2.  
  3. Sie
  4.  
  5. Sie

Exam (elaborations)

FINRA Series 7 Stimulated Exam 3 Questions and Answers | 100% Pass
 0 view  0 purchase
  • Course
  • Sie
  • Institution
  • Sie

FINRA Series 7 Stimulated Exam 3 Questions and Answers | 100% Pass Which of the following option strategies, besides going long a call, can be used to purchase stock below its current market value? A) Short call B) Short straddle C) Long put D) Short put - ️️ Correct-A) Short call B) Sh...

[Show more]

Preview 4 out of 33  pages

Document information

  • September 25, 2024
  • 33
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

Subjects

  • finra series 7 stimulated exam 3 questions and ans

Written for

  • Sie
  • Sie

Seller

avatar-seller
EmillyCharlotte

Content preview

TITLE: EMILLYCHARLOTTE 2024/2025 ACADEMIC PERIOD
OWNER: EMILLYCHARLOTTE
COPYRIGHT STATEMENT: ©2024 EMILLYCHARLOTTE. ALL RIGHTS RESERVED
FIRST PUBLISHED: SEPTEMBER 2024

FINRA Series 7 Stimulated Exam 3
Questions and Answers | 100% Pass


Which of the following option strategies, besides going long a call, can be used to

purchase stock below its current market value?

A) Short call

B) Short straddle

C) Long put

D) Short put - ✔️✔️Correct-A) Short call

B) Short straddle

C) Long put

D) Short put✅



If the put is exercised by the owner, the writer of the put will be obligated to purchase

the stock. The cost of the stock is reduced by the amount of premium taken in when the

put was written, allowing the investor to purchase the stock at a net cost lower than the

stock's current market value.

The sale of securities in a restricted margin account affects all of the following except

A) market value.

B) special memorandum account.

1/33

,TITLE: EMILLYCHARLOTTE 2024/2025 ACADEMIC PERIOD
OWNER: EMILLYCHARLOTTE
COPYRIGHT STATEMENT: ©2024 EMILLYCHARLOTTE. ALL RIGHTS RESERVED
FIRST PUBLISHED: SEPTEMBER 2024
C) debit balance.

D) equity. - ✔️✔️Correct-A) market value.

B) special memorandum account.

C) debit balance.

D) equity.✅



A restricted margin account is one where the equity is below the 50% Regulation T

level. When a sale of securities owned in that margin account takes place, if the client

wishes to remove proceeds, the maximum permitted is 50% of the sale.

Your client's investment portfolio is 50% growth stocks, 10% foreign stocks, and 40%

blue-chip stocks. If the client is interested in further diversification, which mutual fund

would best meet that goal?

A) Aggressive growth fund

B) Emerging market fund

C) Bond fund

D) Global equity fund - ✔️✔️Correct-A) Aggressive growth fund

B) Emerging market fund

C) Bond fund✅

D) Global equity fund




2/33

,TITLE: EMILLYCHARLOTTE 2024/2025 ACADEMIC PERIOD
OWNER: EMILLYCHARLOTTE
COPYRIGHT STATEMENT: ©2024 EMILLYCHARLOTTE. ALL RIGHTS RESERVED
FIRST PUBLISHED: SEPTEMBER 2024
All of the current holdings are equities. To further diversify the current portfolio, the bond

fund would be the best choice of those given to meet this objective.

If 1 OEX 375 call is purchased at 3.25 and exercised when the S&P 100 closes at 381,

the writer delivers which of the following to the holder?

A) $600 cash

B) $600 in stocks

C) $325 cash

D) $381 in securities - ✔️✔️Correct-A) $600 cash✅

B) $600 in stocks

C) $325 cash

D) $381 in securities



Index options settle in cash. Physical delivery does not occur. The call buyer receives

cash equal to the difference between the strike price and the index closing value on the

day the option is exercised. With the index closing price of 381 and the strike price at

375, that difference is 6 points. With a multiplier of $100, the settlement is $600.

If a customer buys 100 XYZ at 49 and writes 1 XYZ Nov 50 call, receiving $350 in

premiums, the breakeven point is

A) $52.50.

B) $53.50.

C) $45.50.


3/33

, TITLE: EMILLYCHARLOTTE 2024/2025 ACADEMIC PERIOD
OWNER: EMILLYCHARLOTTE
COPYRIGHT STATEMENT: ©2024 EMILLYCHARLOTTE. ALL RIGHTS RESERVED
FIRST PUBLISHED: SEPTEMBER 2024
D) $46.50. - ✔️✔️Correct-A) $52.50.

B) $53.50.

C) $45.50.✅

D) $46.50.



This is a covered call, so the investor is protected against declining stock prices to the

extent of the premium received, and the breakeven is $45.50 $49 − $3.50).

A municipal issuer publishes an official notice of sale to indicate that the offering will be

made

A) for none of these.

B) on a competitive basis.

C) on a negotiated basis.

D) through a private placement. - ✔️✔️Correct-A) for none of these.

B) on a competitive basis.✅

C) on a negotiated basis.

D) through a private placement.



An official notice of sale is the issuer's method of inviting competitive bids on a new

issue. It sets forth all of the information about the issue that a dealer would need to

make a bid, including the size of the offering; the maturity dates; and the date, time, and

place of the sale.

4/33

The benefits of buying summaries with Stuvia:

Guaranteed quality through customer reviews

Guaranteed quality through customer reviews

Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.

Quick and easy check-out

Quick and easy check-out

You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.

Focus on what matters

Focus on what matters

Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!

Frequently asked questions

What do I get when I buy this document?

You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.

Satisfaction guarantee: how does it work?

Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.

Who am I buying these notes from?

Stuvia is a marketplace, so you are not buying this document from us, but from seller EmillyCharlotte. Stuvia facilitates payment to the seller.

Will I be stuck with a subscription?

No, you only buy these notes for $12.49. You're not tied to anything after your purchase.

Can Stuvia be trusted?

4.6 stars on Google & Trustpilot (+1000 reviews)

78121 documents were sold in the last 30 days

Founded in 2010, the go-to place to buy study notes for 14 years now

Start selling
$12.49
  • (0)
  Add to cart