SIE by FINRA Actual Free Exam Questions And Answers

Question 1

Which of the following information is typically contained in the preliminary prospectus for a company conducting an initial public offering (IPO)?

A. Anticipated trading volume

B. Ownership structure

C. FINRA determination that the preliminary prospectus is accurate

D. SEC approval of the merits of the offering

Discussion 0

Correct Answer: B Vote an answer

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Question 2

SIPC provides investor protection for its members ' customers in which of the following situations?

A. Failure of a brokerage firm to meet customers ' investment expectations

B. Failure of a brokerage firm in the event of insolvency

C. Losses incurred on futures contracts due to fraud or negligence

D. Losses greater than 10% due to systemic market decline

Discussion 0

Correct Answer: B Vote an answer

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Question 3

Which of the following documents is a broker-dealer required to deliver at or prior to the completion of a purchase of mutual fund shares?

A. Prospectus

B. Statement of additional information

C. Offering memorandum

D. Red herring

Discussion 0

Correct Answer: A Vote an answer

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Question 4

The civil penalty for an individual who is convicted of an insider trading violation is permitted to be an amount up to how many times the profit gained or loss avoided?

A. 1 time

B. 10 times

C. 3 times

D. 6 times

Discussion 0

Correct Answer: C Vote an answer

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Question 5

Which of the following responses describes a new offering of securities that is exempt from registration under SEC Regulation D?

A. An offering of more than $10 million

B. An offering in which purchasers are permitted to sell the securities without restrictions

C. An offering to no more than 35 nonaccredited investors

D. An offering made only to existing shareholders

Discussion 0

Correct Answer: C Vote an answer

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Question 6

Beta coefficient is a measure of:

A. Only the upside participation of an individual stock.

B. The liquidity of an individual stock relative to the sector average.

C. The volatility of the broad stock market.

D. The volatility of an individual stock relative to the broad stock market.

Discussion 0

Correct Answer: D Vote an answer

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Question 7

Executing trades using the delivery versus payment (DVP) settlement process requires the buyer to make a cash payment by which of the following deadlines?

A. On the 5th business day after execution

B. By the agreed-upon settlement date with the issuer

C. No later than 3 days after the securities are delivered

D. Before or at the same time as securities being delivered

Discussion 0

Correct Answer: D Vote an answer

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Question 8

An investment company product that is actively managed and continuously offered is a description of which of the following products?

A. Variable annuity

B. Closed-end fund

C. Open-end fund

D. Unit investment trust (UIT)

Discussion 0

Correct Answer: C Vote an answer

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Question 9

A mother wants to set up an account for her son so she can make yearly gifts but not allow her son to withdraw funds to pay for his living expenses. Which of the following account types best meets this objective?

A. A joint tenants with right of survivorship (JTWROS) account

B. A trust account

C. A separately managed account

D. A Coverdell Education Savings Account

Discussion 0

Correct Answer: B Vote an answer

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Question 10

A common stock undergoes a 1-for-25 reverse stock split. Which of the following statements describes the impact of the issuer ' s market capitalization?

A. It remains the same as it was prior to the split.

B. It increases because the stock price increases.

C. It increases because there are more shares outstanding.

D. It decreases because there are fewer shares outstanding.

Discussion 0

Correct Answer: A Vote an answer

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Question 11

Which of the following responses describes a warrant?

A. An interest-paying security

B. The right to purchase a specified amount of shares

C. A fixed-income security issued by a state or municipality

D. Redemption rights for a debt instrument

Discussion 0

Correct Answer: B Vote an answer

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Question 12

A broker-dealer (BD) is required to ensure a hyperlink to BrokerCheck is Included on which of the following communications?

A. The BD ' s homepage intended for retail customers

B. A registered representative ' s (RR ' s) outgoing email

C. An RR ' s social media site that Identifies his BD employment

D. An email response to a complaint from a retail customer

Discussion 0

Correct Answer: A Vote an answer

Question 13

A market maker typically trades in which of the following capacities?

A. Broker

B. Agent

C. Fiduciary

D. Principal

Discussion 0

Correct Answer: D Vote an answer

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Question 14

When is it permissible to exercise European-style options contracts?

A. Only on the day after expiration

B. Only on the day of expiration

C. Only on the third Friday of every month

D. Only on the last business day before expiration

Discussion 0

Correct Answer: B Vote an answer

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FINRA Securities Industry Essentials Exam (SIE) - SIE Exam Practice Test

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