SIE Study Guide

SIE Study Guide Section 2:
Review Quiz

This Section 2 review quiz tests your understanding of key investment products and concepts, including equity securities, debt instruments, options, packaged products, and investment risk. Use your quiz results to identify any areas that may need additional study time before moving on.

Next: Trading, Settlement, and Corporate Actions

Previous Next

SIE Study Guide

Section 1

Section 2

Section 3

Section 4

SIE Study Guide Section 2:Review Quiz

Quiz Summary

Information

Results

Results

Categories

1. Question

Which of the following statements about corporate equity is true?

2. Question

In the event a corporation goes bankrupt, which of the following statements is true?

3. Question

When a bond is described as ‘convertible,’ this term refers to:

4. Question

Generally speaking, when control persons of a publicly-traded corporation, such as Officers and Directors, wish to sell shares they own in that corporation, these sales are subject to the oversight of the SEC and are done in accordance with:

5. Question

A bond issued to fund a new toll road, which will be paid off by users of the toll road through payment of tolls and not by taxes levied on the general population, is known as a:

6. Question

The term ‘money market’ is frequently used in financial discussions. Which of the following best defines a money market instrument?

7. Question

Bonds initially offered for sale are typically sold at their:

8. Question

With respect to the relationship between interest rates and bond prices, the general rule of thumb in the bond market is:

9. Question

Which of the following statements regarding options contracts is true?

10. Question

Pooled investments, such as mutual funds, offer shares of ownership in the fund to investors whose investment objectives match those being promoted by that particular fund. In most cases, the fund attempts to achieve its stated investment objectives through which of the following practices?

11. Question

Representatives who sell mutual fund shares are often compensated through sales charges levied upon purchasers of the shares. However, the fees paid to the professional managers hired by the fund to make the day-to-day investment decisions are referred to as:

12. Question

A business enterprise that offers its shares to the public and invests those dollars in a variety of real estate investments is most commonly referred to as a:

13. Question

When FINRA refers to ETPs in their rulebook, they are referring to each of the following except:

14. Question

The value of the dollar declines due to inflation. This exposes fixed income investments, whose annual income does not rise to keep pace with the rate of inflation, to a risk commonly referred to by investment professionals as:

15. Question

Systematic risk, the risk that the broad stock market will suffer a substantial decline in value, is also commonly called:

16. Question

You’ve no doubt heard the expression ‘don’t put all your eggs in one basket.’ With investing, the dangers of having all your money in one investment or in one sector of the economy is referred to as:

17. Question

Following Question #16, one of the most well-established ways of mitigating the ‘all in one basket’ risk is:

18. Question

Moody’s and Standard & Poor’s are two of the most well-known statistical rating organizations that, among other things, rate the investment quality of bond issues. Ratings in the AAA, AA and A categories are referred to as:

19. Question

The ability of an investor to readily sell their investment at a fair market price is called:

20. Question

When interest rates are higher than average, bond issuers will often add a callable feature to those high-interest bonds. This benefits the issuer in that if and when rates come down in the future, they can sell brand new bonds at the lower interest rate and use the infusion of cash to do what?

21. Question

Used to save up for certain postsecondary educational expenses, 529 college savings plans enjoy all the following tax benefits except:

22. Question

In a direct participation program (DPP), the investors who buy into the program are referred to as:

23. Question

Hedge funds and private equity funds share some similarities and often get confused with one another. The primary difference between the two is that private equity funds:

24. Question

An investor purchases a 5% coupon rate bond for a discount at $850 (par value is $1,000). What is this bond’s current yield?

25. Question

An investor owns a call option which gives them the right to buy 150 shares of Company XYZ stock at a strike price of $115. If Company XYZ is currently trading at $140, then the option is considered to be:

Next: Trading, Settlement, and Corporate Actions

SIE Study Guide Section 2:
Review Quiz