Question 1
Which statement about the Municipal Securities Rulemaking Board (MSRB) is true?
SIE section 1: Knowledge of Capital Markets
Twelve questions cover who regulates the markets, how securities are offered and how the economy moves interest rates.
| Questions | 12 of 75 (16%) |
|---|---|
| Main topics | Regulators and participants, market types, offerings, economic factors |
What comes up
- The SEC, SROs such as FINRA and the MSRB, state regulators, the Fed, SIPC and the FDIC
- Primary, secondary, third and fourth markets
- Firm commitment and best efforts underwriting, prospectuses and exemptions
- Monetary and fiscal policy, the business cycle and economic indicators
Where marks go
- Mixing up the discount rate, the federal funds rate and the prime rate
- Thinking SIPC protects against a fall in market value
- Forgetting the SEC never approves an offering
Try 3 questions
Question 2
The Federal Reserve buys Treasury securities in the open market. What is the usual effect?
Question 3
In a firm commitment underwriting, who bears the risk of shares that cannot be sold to the public?
Next step
Questions people ask
Does SIPC cover stock market losses?
No. SIPC returns missing customer property when a member broker-dealer fails, up to $500,000 including $250,000 in cash. Market losses are never covered.
Is FINRA a government agency?
No. FINRA is a self-regulatory organization overseen by the SEC.