Pass exam with Series_63 Top Exam Collection for sure one-shot

FINRA Series_63 Exam Overview:

FINRA Series_63 Exam Syllabus Topics:

FINRA Uniform Securities Agent State Law Examination Sample Questions:

1. Bootstraps, Inc. is a family-owned business that has experienced enormous growth in the last couple of
years. The business needs more cash to support this growth and has decided to issue some promissory
notes, each with a face value of $5,000, for sale to the general public. The firm plans to hire three
individuals to help them sell these notes. These individuals will earn a commission based on the notes
they sell. Given these facts, which of the following is true?

A) The notes must be registered with the state, and the three individuals hired to sell the notes must be
registered as agents with the state.
B) The notes must be registered with the state, but the individuals hired to sell them are not required to be
registered.
C) Either the firm must register the notes with the state, or the individuals that are hired to sell the notes
must be registered as agents with the state, but not both.
D) Neither the notes nor the individuals selling the notes need to be registered with the state.

2. Price pegging refers to

A) the illegal activity of a group of investors who buy and sell a security among themselves to create an
artificially high volume of trading in hopes of luring investors to buy the security.
B) the practice of buying large amounts of a security to drive its price up artificially.
C) the unethical practice of investment advisers who issue "buy" recommendations for stocks that they
own themselves without disclosing the fact.
D) the prohibited practice of excessively trading on a client's account that is used by some broker-dealers
and/or their agents to generate more commissions for themselves.

3. Under the NASAA Model Rules, which of the following must an investment adviser provide its clients with
at least once a year?

A) the total amount of commissions or other compensation that the investment adviser received or
expects to receive in connection with agency cross transactions performed for the client during the period
B) both A and B
C) the number of any complaints that each of its investment adviser representatives has received during
the period
D) the total number of agency cross transactions completed for the client during the period

4. Jeremy Sly considered himself somewhat of an inventor. The only problem was that his day job interfered
with his opportunity to exercise his creativity. He came up with a plan to get outside investors to support
his inventive activities. To this end, he produced and distributed a brochure advertising partnership
interests with a guaranteed return on investment of at least 15% after the first 12 months, based on what
he had allegedly generated from his other (non-existent) inventions. Given these facts, is Jeremy guilty of
any security violations under the Uniform Securities Act (USA)?

A) No. An interest in a partnership is not considered a security.
B) Yes. Even an "offer" to sell securities must not contain any untruths.
C) No. The facts don't indicate whether any partnership interests were actually sold, and there can be no
violation unless there is a sale.
D) No. It is not against the law to believe in oneself and promote one's ideas.

5. An investment adviser suggests that his client, Arnold, a 74-year old gentleman, should consider a
reallocation of the assets in his portfolio. The adviser tells Arnold that he has far too much invested in
bonds, which don't earn as much as stocks. He advises Arnold to take 80% of the money he has in bonds
and invest it in an aggressive growth mutual fund that has provided an average annual return of 40% over
the past three years. Arnold is impressed and follows this advice. Shortly thereafter, there is a steep drop
in the market in general, and the net asset value of the aggressive growth mutual fund falls 85%. Does
Arnold have any remedies available to him?

A) No. Arnold had the choice and got greedy. As the old saying goes, "Bulls get rich, and bears get rich,
but pigs get led to slaughter."
B) Yes. Arnold can sue for the amount of his losses, plus interest, court costs, and attorneys' fees.
C) Yes. Arnold can sue for the amount of his losses, plus interest, as well as an amount assessed by the
court for "pain and suffering."
D) No. The investment adviser had no way of knowing that the market was going to fall when he provided
the advice, so the adviser did not fail in his fiduciary responsibility to Arnold.

Solutions: