STC SIE Questions and Answers 100% Pass Chapter 1
True or False: The offer (ask) is the price at which a broker-dealer is willing to buy shares from a customer. - Answers False. The bid price is the price at which a firm will buy, while the offer (ask) is the price at which it will sell.
Identify...
True or False: The offer (ask) is the price at which a broker-dealer is willing to buy shares from a
customer. - Answers False. The bid price is the price at which a firm will buy, while the offer (ask) is the
price at which it will sell.
Identify the acronym: OTC - Answers Over-the-counter
What is the price at which a dealer is willing to sell? - Answers The ask or offer price
What is the role of a broker-dealer's operations department? - Answers To process paperwork, handle
funds and securities transfers, and settle and confirm transactions
BD employees who are involved in the investment banking and securities business are called
____________________________. - Answers BD employees who are involved in the investment banking
and securities business are called registered representatives.
Explain the secondary market. - Answers The market on which existing securities are traded
Identify the acronym: RR - Answers Registered representative
A ______ is any person that executes ______ transactions in securities for the account of others. -
Answers Broker; agency
In an _______ arrangement, a clearing firm doesn't have information on each individual customer of an
introducing firm. - Answers Omnibus
What is a dark pool? - Answers A dark pool is a place for large institutional investors and high-frequency
traders to trade directly with one another.
Define a prime broker. - Answers A BD that clears and settles trades effected by one or more executing
brokers at the direction of the customer
In a _____ _________ account, information about each customer of the introducing firm is sent to the
clearing firm. - Answers Fully-disclosed
A Nasdaq-listed stock trades in the __________ market. - Answers Secondary
QIB stands for ___________________________. - Answers Qualified Institutional Buyer (QIB)
Which market is the decentralized, negotiated market? - Answers The over-the-counter market (OTC)
What is the federal law that governs investment advisers? - Answers The Investment Advisers Act of
1940
Where may quotes for non-Nasdaq (OTC equity) stocks be found? - Answers Pink sheets or the OTC
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