CH 1
Represents ownership in a company, will have voting rights
What is common stock?
This term is used when a bond is trading above $1,000.
What is a Premium?
The writer is Obligated to Buy stock when this option is exercised.
What is a Put Option?
A financial institution principally engaged in investing in securities.
What is an Investment Company?
Firms hired by corporations to help them with various financing and corporate-related matters.
What is an Investment Banker?
2. Secured Debt
3. Un-Secured Debt
4. Preferred Stockholders
5. Common Stockholders
What is the Order of Asset Distribution?
When Current Yield is less than Yield to Maturity, the price of a bond is trading at this.
What is a Discount?
This involves taking an offsetting position in derivatives that corresponds to an existing position.
What is Hedging?
These are the three types of Investment Companies.
What are Face-Amount Certificates, Unit Investment Trusts (UITs), and Management Companies?
Is a redistribution of a large block of securities held by a few owners. These shares may be purchased on margin.
What is a Secondary Distribution?
Shareholders receive one vote per share times the number of directors being voted on. May cast all their votes for one candidate or split them up.
What is Cumulative / Block Voting?
Was designed to make even the wealthiest individuals pay some income tax.
What is the Alternative Minimum Tax (AMT)?
When I Buy a call @ 50 and then Sell a call @ 50 I have done this.
What is a Closing Position?
While it has fund in its name, this is not an investment company.
What is a Hedge Fund?
Paid to Broker-Dealers that are not syndicate or selling group members.
This type of stock moves in the opposite direction of the economy.
i.e.
Gold mining companies
What is Countercyclical Stock?
@98 1/8 or 4.38% would quote this type of bond.
What is a Municipal Bond?
The intrinsic value of an XYZ 30 Call sold at a premium of 3 when the current market value of XYZ is at 40.
What is $10?
This type of Mutual Fund Share has a back-end load.
During this period the Selling Group is formed, Blue Sky is done, and a Due Diligence Meeting is held.
What is the "20" Day Cooling Period?
This form is issued to Limited Partners in a DPP for tax purposes.
When a municipality requests sealed bids from underwriters, offering the bonds to the group that bids with the lowest Net Interest Cost.
What is Competitive Bidding?
This must be received by the member firm within 15 calendar days from the time the account is approved for option transactions.
What is the Option Account Agreement?
Typically called the '40 Act, this act ensures investors are provided with full and fair disclosure of all information needed to make an informed decision.
What is the Investment Company Act of 1940?
Research Analysts may Attend Meetings with issuers management and Publish Research Reports during "quiet period" when covering this type of company.
What is an Emerging Growth Company?