Free Securities Industry Essentials Exam SIE Exam Practice Test

A customer purchases 100 shares of stock on Thursday, August 2. This transaction must settle regular way no later than:

• Friday, August 3
• Monday, August 6
• Tuesday, August 7
• Wednesday, August 8

Trades that settle within the period preset by regulators of the particular market are considered to have which of the following types of settlement?

• Cash
• Rolling
• Next day
• Regular way

A registered representative (RR) opens a new account for a customer whose investment objectives are growth and income. She makes an initial deposit of $5,500 using a series of money orders drawnfrom different sources, and she makes no investments for the first 30 days the account is open. At the end of that time, the customer asks to have the funds wired to an account at a different firm as her needs have changed. The RR's first course of action should be to:

• Deny the request.
• Freeze the account.
• Report internally as a suspicious activity.
• Accept the instructions and wire the funds.

After a customer purchases bonds at a yield of 5.00%, the current yield at market price increases to 5.25%. Which of the following statements is true regarding the value of the bonds?

• The value of the bonds has increased.
• The value of the bonds has decreased.
• The face value of the bonds has decreased.
• There is no change in the value of the bonds.

A currency devaluation impacts a country's economic activity in which of the following ways?

• Decreases inflation
• Decreases gross domestic product (GDP)
• Increases imports from merchandise trade countries
• Makes exports cost less in merchandise trade countries

SEC regulations permit a company to issue securities exempted from registration requirements of the Securities Act of 1933 under which of the following conditions?

• Offerings sold inside of the U.S. to non-U.S. persons
• Offerings sold with no more than 40 accredited investors
• Offerings sold with an aggregate price exceeding $5 million
• Offerings with no more than 35 non-accredited investors and an unlimited number of accredited investors

Under SEC Regulation A, which of the following market participants, if deemed to be a bad actor, will disqualify the offering from reliance on this registration exemption?CustodianUnderwriterTransfer agentClearing corporation

Which of the following is the primary risk of using asset allocation models without periodic rebalancing?

• Inflation
• Marketability
• Overweighting
• Interest rate risk

Company XYZ files a registration statement for its initial public offering (IPO). XYZ is permitted to communicate all of the following information about the offering in writing to investors except that:

• The IPO is expected to price in early February.
• The IPO is being underwritten by Bank ABC and Bank DEF.
• A recent industry report supports the company's valuation.
• The road show will be held February 6–10 in New York and Boston.

Which of the following transactions is most profitable if executed prior to a significant rise in a company's stock price?

• Buying a put option
• Buying a call option
• Selling a put option
• Selling a call option