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Wiley Series 65 Exam Review 2015 + Test Bank: The Uniform Investment Advisor Law Examination(Wiley FINRA)

Wiley Series 65 Exam Review 2015 + Test Bank: The Uniform Investment Advisor Law Examination(Wiley FINRA)


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About the Book

The go-to guide to acing the Series 65 Exam! Consisting of 130 multiple-choice questions in the areas of ethics and legal guidelines, investment strategies, investment vehicles, and economics and analysis, the Uniform Investment Adviser Law Examination (Series 65) is designed to qualify candidates as investment adviser representatives. An indispensable resource for anyone preparing to take this tough three-hour exam, Wiley Series 65 Exam Review 2015 was created by the experts at The Securities Institute of America, Inc. It arms you with what you need to score high and pass the Series 65 Exam on your first try. Designed to let you build and fine-tune your knowledge of all areas covered in the exam and to guarantee that you're prepared mentally and strategically to take the test, it features: * Dozens of examples * Assorted practice questions for each subject area covered in the exam * Priceless test-taking tips and strategies * Helpful hints on how to study for the test, manage stress, and stay focused Wiley Series 65 Exam Review 2015 is your ticket to passing the Uniform Investment Adviser Law Examination with flying colors!

Table of Contents:
ABOUT THE SERIES 65 EXAM XXI ABOUT THIS BOOK XXV ABOUT THE TEST BANK XXVII ABOUT THE SECURITIES INSTITUTE OF AMERICA XXIX CHAPTER 1 EQUITY SECURITIES 1 What Is a Security? 1 Equity = Stock 2 Common Stock 2 Corporate Time Line 2 Values of Common Stock 4 Book Value 4 Par Value 5 Rights of Common Stockholders 5 Preemptive Rights 5 Characteristics of a Rights Offering 6 Determining the Value of a Right Cum Rights 7 Determining the Value of a Right Ex Rights 7 Voting 8 Limited Liability 9 Freely Transferable 9 The Transfer Agent 10 The Registrar 10 CUSIP Numbers 11 Inspection of Books and Records 11 Residual Claim to Assets 11 Why Do People Buy Common Stock? 11 Income 11 What Are the Risks of Owning Common Stock? 12 How Does Someone Become a Stockholder? 12 Preferred Stock 14 Features of All Preferred Stock 14 Types of Preferred Stock 15 Callable Preferred 17 Types of Dividends 17 Dividend Distribution 18 Taxation of Dividends 20 Selling Dividends 20 Dividend Disbursement Process 21 Warrants 21 How Do People Get Warrants? 21 American DepositAry Receipts (ADRs)/American DepositAry Shares (ADSs) 22 Currency Risks 22 Functions of the Custodian Bank Issuing ADRs 23 Real Estate Investment Trusts/REITs 23 Direct Participation Programs and Limited Partnerships 23 Limited Partnerships 24 Tax Reporting for Direct Participation Programs 27 Limited Partnership Analysis 28 Tax Deductions vs. Tax Credits 28 Other Tax Considerations 28 Dissolving a Partnership 29 Pretest 31 CHAPTER 2 CORPORATE AND MUNICIPAL DEBT SECURITIES 35 Corporate Bonds 35 Types of Bond Issuance 36 Bond Pricing 37 Par Value 38 Discount 38 Premium 38 Corporate Bond Pricing 38 Bond Yields 39 Yield to Maturity: Premium Bond 40 Yield to Maturity: Discount Bond 41 Calculating the Yield to Maturity 41 Calculating the Yield to Call 42 Realized Compound Yield Returns 42 Yield Spreads 43 The Real Interest Rate 43 Bond Maturities 43 Series Issue 44 Types of Corporate Bonds 44 Guaranteed Bonds 46 Convertible Bonds 46 Converting Bonds into Common Stock 47 Parity Price 47 Advantages of Issuing Convertible Bonds 48 Disadvantages of Issuing Convertible Bonds 48 Convertible Bonds and Stock Splits 48 The Trust Indenture Act of 1939 49 Bond Indenture 49 Ratings Considerations 49 Exchange Traded Notes (ETNs) 50 Euro and Yankee Bonds 50 Variable Rate Securities 51 Retiring Corporate Bonds 51 Municipal Bonds 53 Types of Municipal Bonds 54 Taxation of Municipal Bonds 58 Tax-Equivalent Yield 58 Purchasing a Municipal Bond Issued in the State in Which the Investor Resides 59 Triple Tax Free 59 Original Issue Discount (OID) and Secondary Market Discounts 59 Amortization of a Municipal Bond s Premium 60 Bond Swaps 60 Analyzing Municipal Bonds 60 Analyzing General Obligation Bonds 61 Duration 61 Convexity 62 Bond Portfolio Management 62 Pretest 65 CHAPTER 3 GOVERNMENT AND GOVERNMENT AGENCY ISSUES 69 Series EE Bonds 69 Series HH Bonds 70 Treasury Bills, Notes, and Bonds 70 Purchasing Treasury Bills 70 Treasury Notes 71 Treasury Bonds 71 Treasury Bond and Note Pricing 71 Treasury STRIPs 72 Treasury Receipts 72 Treasury Inflation Protected Securities (TIPS) 73 Agency Issues 74 Government National Mortgage Association (GNMA) 74 Federal National Mortgage Association (FNM) 75 Federal Home Loan Mortgage Corporation (FHLMC) 75 Federal Farm Credit System 76 Collateralized Mortgage Obligation (CMO) 76 CMOs and Interest Rates 76 Types of CMOs 77 Pretest 79 CHAPTER 4 INVESTMENT COMPANIES 81 Investment Company Philosophy 81 Types of Investment Companies 82 Open End vs. Closed End 83 Diversified vs. Nondiversified 84 Investment Company Registration 85 Registration Requirements 85 Investment Company Components 87 Mutual Fund Distribution 89 Selling Group Member 89 Distribution of No-Load Mutual Fund Shares 90 Distribution of Mutual Fund Shares 90 Mutual Fund Prospectus 90 Characteristics of Open-End Mutual Fund Shares 91 Mutual Fund Investment Objectives 92 Other Types of Funds 94 Bond Funds 94 Valuing Mutual Fund Shares 96 Sales Charges 97 Other Types of Sales Charges 99 Calculating a Mutual Fund s Sales Charge Percentage 99 Finding the Public Offering Price 100 Sales Charge Reductions 100 Breakpoint Schedule 101 Letter of Intent 101 Breakpoint Sales 102 Rights of Accumulation 102 Automatic Reinvestment of Distributions 103 Other Mutual Fund Features 103 Dollar Cost Averaging 104 Mutual FUnds Voting Rights 106 Mutual Fund Yields 107 Portfolio Turnover 107 Pretest 109 CHAPTER 5 VARIABLE ANNUITIES AND RETIREMENT PLANS 113 Annuities 113 Bonus Annuity 115 Equity-Indexed Annuity 116 Annuity Purchase Options 117 Accumulation Units 118 Annuity Units 118 Annuity Payout Options 119 Factors Affecting the Size of the Annuity Payment 120 The Assumed Interest Rate (AIR) 120 Taxation 121 Types of Withdrawals 121 Annuitizing the Contract 121 Sales Charges 122 Investment Management Fees 122 Variable Annuity vs. Mutual Fund 122 Retirement Plans 122 Individual Plans 123 Individual Retirement Accounts (IRAs) 123 Corporate Plans 131 Types of Plans 132 Rolling Over a Pension Plan 134 Employee Stock Options 134 Employee Retirement Income Security Act of 1974 (ERISA) 135 ERISA 404C SAFE HARBOR 136 Life Insurance 137 Pretest 141 CHAPTER 6 FUNDAMENTAL AND TECHNICAL ANALYSIS 145 Fundamental Analysis 145 Balance Sheet 146 Capitalization 148 Changes in the Balance Sheet 148 The Income Statement 152 Industry Fundamentals 154 Top Down and Bottom Up Analysis 154 Dividend Valuation Models 155 Technical Analysis 155 Market Theories and Indicators 159 Efficient Market Theory 160 Statistical Analysis 161 Market Capitalization 162 Pretest 163 CHAPTER 7 ECONOMIC FUNDAMENTALS 165 Gross Domestic Product 165 Recession 167 Depression 167 Economic Indicators 167 Schools of Economic Thought 169 Economic Policy 170 Tools of the Federal Reserve Board 170 Reserve Requirement 170 Changing the Discount Rate 171 Federal Open Market Committee 171 Money Supply 172 Disintermediation 172 Moral Suasion 173 Fiscal Policy 173 International Monetary Considerations 175 Pretest 177 CHAPTER 8 RECOMMENDATIONS, PROFESSIONAL CONDUCT, AND TAXATION 181 Professional Conduct by Investment Advisers 182 The Uniform Prudent Investors Act of 1994 182 Fair Dealings with Clients 183 Recommending Mutual Funds 187 Periodic Payment Plans 187 Disclosure of Client Information 188 Borrowing and Lending Money 188 Developing the Client Profi le 188 Types of Advisory Clients 189 Investment Objectives 194 Capital Asset Pricing Model (CAPM) 196 Risk vs. Reward 196 Alpha 198 Beta 198 Expected Return 199 Time Value of Money 200 Weighted Returns 202 Modern Portfolio Theory 204 Predicting Portfolio Income 204 Tax Structure 206 Investment Taxation 207 Calculating Gains and Losses 207 Cost Base of Multiple Purchases 208 Deducting Capital Losses 209 Wash Sales 209 Taxation of Interest Income 209 Inherited and Gifted Securities 210 Donating Securities to Charity 210 Trusts 211 Gift Taxes 212 Estate Taxes 213 Withholding Tax 213 Corporate Dividend Exclusion 214 Alternative Minimum Tax (AMT) 214 Taxes on Foreign Securities 214 Pretest 215 CHAPTER 9 SECURITIES INDUSTRY RULES AND REGULATIONS 219 The Securities Act of 1933 219 The Prospectus 220 The Final Prospectus 220 SEC Disclaimer 221 Misrepresentations 221 The Securities Exchange Act of 1934 221 The Securities Exchange Commission (SEC) 222 Extension of Credit 223 Public Utilities Holding Company Act of 1935 223 Financial Industry Regulatory Authority (FINRA) 223 The Trust Indenture Act of 1939 224 Investment Advisers Act of 1940 224 Investment Company Act of 1940 224 FINRA Member Communications with the Public 225 FINRA Rule 2210 Communications with the Public 226 Corporate Websites 228 Blind Recruiting Ads 229 Generic Advertising 229 Tombstone Ads 229 Testimonials 230 Free Services 231 Misleading Communications 231 Securities Investor Protection Corporation Act of 1970 (SIPC) 231 Net Capital Requirement 232 Customer Coverage 232 Fidelity Bond 233 The Securities Acts Amendments of 1975 233 The Insider Trading and Securities Fraud Enforcement Act of 1988 233 Firewall 234 The Telephone Consumer Protection Act of 1991 234 Exemption from the Telephone Consumer Protection Act of 1991 235 National Securities Market Improvement Act of 1996 235 The Uniform Securities Act 236 Currency Transactions 236 The Patriot Act 237 Pretest 239 CHAPTER 10 TRADING SECURITIES 243 Types of Orders 243 The Exchanges 247 Priority of Exchange Orders 247 The Role of the Specialist/DMM 247 The Specialist/DMM Acting as a Principal 248 The Specialist/DMM Acting as an Agent 248 Crossing Stock 250 Do Not Reduce (DNR) 251 Adjustments for Stock Splits 251 Stopping Stock 252 Commission House Broker 253 Two-Dollar Broker 253 Registered Traders 253 Super Display Book (SDBK) 253 Short Sales 254 Regulation of Short Sales/Regulation SHO 254 Rule 200 Defi nitions and Order Marking 254 Rule 203 Security Borrowing and Delivery Requirements 255 Over the Counter/Nasdaq 256 Market Makers 257 Nasdaq Subscription Levels 257 Nasdaq Quotes 258 Nominal Nasdaq Quotes 259 Nasdaq Execution Systems 259 Nasdaq Market Center Execution System (NMCES) 259 Nasdaq Opening Cross 260 Non-Nasdaq OTCBB 260 Pink Sheets 260 Third Market 260 Fourth Market 261 Broker vs. Dealer 261 FINRA 5% Markup Policy 262 Markups/Markdowns when Acting as a Principal 262 Riskless Principal Transactions 263 Proceeds Transactions 264 Arbitrage 264 Pretest 265 CHAPTER 11 OPTIONS 269 Option Classification 269 Option Classes 270 Option Series 270 Bullish vs. Bearish 270 Possible Outcomes for an Option 271 Characteristics of All Options 272 Managing an Option Position 272 Buying Calls 273 Maximum Gain Long Calls 273 Maximum Loss Long Calls 273 Determining the Breakeven for Long Calls 274 Selling Calls 274 Buying Puts 276 Selling Puts 277 Option Premiums 279 In-the-Money Options 279 At-the-Money Options 279 Out-of-the-Money Options 280 Intrinsic Value and Time Value 280 Using Options as a Hedge 281 Long Stock Long Puts/Married Puts 281 Long Stock Short Calls/Covered Calls 283 Short Stock Long Calls 285 Short Stock Short Puts 288 Futures and Forwards 291 Correlation 291 Pretest 293 CHAPTER 12 DEFINITION OF TERMS 297 Security 297 Person 299 Broker Dealer 300 Agent 301 Issuer 301 Nonissuer 302 Investment Adviser 302 Pension Consultants 302 Form ADV 303 Investment Adviser Representative 304 Solicitor 304 Access Person 304 Institutional Investor 304 Accredited Investor 305 Qualified Purchaser 305 Private Investment Company 306 Offer/Offer to Sell/Offer to Buy 306 Sale/Sell 306 Guarantee/Guaranteed 306 Contumacy 307 Federally Covered Exemption 307 Power of attorney 307 Negotiable Certificate of Deposit 308 Pretest 309 CHAPTER 13 REGISTRATION OF BROKER DEALERS, INVESTMENT ADVISERS, AND AGENTS 315 Registration of Broker Dealers and Agents 315 Changes in an Agent s Employment 319 Mergers and Acquisitions of Firms 319 Renewing Registrations 319 Canadian Firms and Agents 320 Investment Adviser Registration 320 Advertising and Sales Literature 324 Brochure Delivery 325 The Role of the Investment Adviser 325 Additional Compensation for an Investment Adviser 325 Agency Cross Transactions 326 Disclosures by an Investment Adviser 326 Investment Adviser Contracts 328 Additional Roles of Investment Advisers 328 Private Investment Companies/Hedge Funds 328 Fulcrum Fees 329 Wrap Accounts 329 Soft Dollars 329 Pretest 333 CHAPTER 14 SECURITIES REGISTRATION, EXEMPT SECURITIES, AND EXEMPT TRANSACTIONS 339 Exempt Securities 339 Securities Registration 340 Exempt Securities/Federally Covered Exemption 343 Exempt Transactions 344 Private Placements/Regulation D Off erings 344 Transactions with Financial Institutions 345 Transactions with Fiduciaries 345 Transactions with Underwriters 345 Unsolicited Orders 346 Transactions in Mortgage-Backed Securities 346 Pledges 346 Offers to Existing Securities Holders 346 Preorganization Certificates 346 Isolated Nonissuer Transactions 347 Nonissuer Transactions 347 Pretest 349 CHAPTER 15 STATE SECURITIES ADMINISTRATOR: THE UNIFORM SECURITIES ACT 353 Actions by the State Securities Administrator 353 Cancelation of a Registration 354 Withdrawal of a Registration 355 Actions Against an Issuer of Securities 355 Rule Changes 355 Administrative Orders 355 Interpretive Opinions 356 Administrative Records 357 Investigations 357 Civil and Criminal Penalties 358 Jurisdiction of the State Securities Administrator 358 Administrator s Jurisdiction over Securities Transactions 359 Right of Rescission 361 Statute of Limitations 362 Pretest 363 ANSWER KEYS 369 GLOSSARY OF EXAM TERMS 383 INDEX 449


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Product Details
  • ISBN-13: 9781118857069
  • Publisher: John Wiley & Sons Inc
  • Publisher Imprint: John Wiley & Sons Inc
  • Edition: Revised edition
  • Language: English
  • Returnable: N
  • Returnable: N
  • Spine Width: 27 mm
  • Weight: 1175 gr
  • ISBN-10: 1118857062
  • Publisher Date: 20 Oct 2014
  • Binding: Paperback
  • Height: 278 mm
  • No of Pages: 492
  • Returnable: N
  • Series Title: Wiley FINRA
  • Sub Title: The Uniform Investment Advisor Law Examination
  • Width: 217 mm


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