Customer Accounts
Investment Companies
Life Insurance
Debt Securities
Acronyms
100
True or False: Principals must approve discretionary orders prior to entry.
What is False. The orders must be approved promptly afterward.
100
True or False: The market price of closed-end shares could be higher, lower, or equal to the NAV.
True. Shares can trade at a premium or discount to NAV based on supply and demand forces.
100
Who assumes the investment risk in a variable insurance contract?
What is The client
100
Bondholders are also referred to as ____________.
Bondholders are also referred to as creditors.
100
Identify the acronym: AIR
What is Assumed Interest Rate
200
What advice should be given to a newly married couple that wishes to begin investing?
What is Put aside cash reserves before buying long-term investments
200
True or False: Mutual fund shares may be purchased and sold in the secondary market.
False. Mutual funds are always considered new issues and are bought and sold through the fund.
200
Variable contract assets are placed in the insurance company's ___________ account.
Variable contract assets are placed in the insurance company's separate account.
200
What is the proper order of liquidation for a corporation at bankruptcy?
What is Unpaid workers, IRS, secured creditors, unsecured creditors, preferred, and then common.
200
Identify the acronym: REIT
What is Real Estate Investment Trust (This is NOT a type of investment company.)
300
Once validate an account transfer must be completed within _____ business day(s).
Once validate an account transfer must be completed within three business days.
300
What are the three different types of investment companies?
1) Face Amount Certificate Companies 2) Unit Investment Trusts (UITs) 3) Management Companies
300
Prospectus delivery is required for all ___________ insurance contracts.
Prospectus delivery is required for all variable insurance contracts.
300
Calculate the price of a corporate bond quoted at 98 ¾.
Convert fraction into a decimal: 3 ÷ 4 = .75 and then multiply $1,000 by 98.75% = $987.50.
300
Identify the acronym: CPI
What is Consumer Price Index
400
SIPC provides coverage of $_________ of which no more than $_________ can be cash.
SIPC provides coverage of $500,000 of which no more than $250,000 can be cash.
400
What amount of an investment company's Board of Directors must be independent/unaffiliated?
What is a majority
400
What is the maximum period to be able to convert a VLI policy to a whole life contract?
What is 2 years
400
What are two synonymous terms for a bond’s interest rate?
Coupon rate and nominal yield
400
Identify the acronym: VLI
What is Variable Life Insurance
500
Both the ____________ and the ____________ are required for a corporation to open an options or margin account.
Both the Corporate Resolution and Corporate Charter are required for a corporation to open an options or margin account.
500
What are three distinct advantages to investing in an open-end investment company?
1) Diversification 2) Professional Management 3) Liquidity
500
What is the tax implication of a policy loan on a life insurance policy?
What is The loan is not taxed, but interest is charged on the outstanding balance.
500
What does yield-to-maturity (YTM) take into account that current yield does not?
Discount/premium made or lost at maturity, reinvestment of interest at YTM, and time value of money
500
As it relates to securities law, what does the acronym USA mean?
The Uniform Securities Act, also known as the blue-sky laws
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