General Securities Representative SIE Dumps PDF

Step by Step Explanation:

Discount Bonds: These are issued or traded below par value. Over time, their price moves closer to par as they approach maturity, assuming yields remain constant.

Other Options:

Par Value Changes: The par value of a bond does not change over time; only its price fluctuates.

References:

SEC and FINRA Bond Basics: SEC Discount Bonds.

Step by Step Explanation:

Right of Accumulation: Allows an investor to combine the value of existing investments within the same fund family to qualify for a breakpoint (reduced sales charge) on new purchases.

Current Holdings: $80,000

New Purchase: $50,000

Total: $130,000, qualifying for the $100,000 breakpoint.

Incorrect Options:

B: Contributions from all funds within the same family can be aggregated.

C: A new letter of intent is unnecessary; right of accumulation applies automatically.

D: Discounts apply immediately, not retroactively.

References:

FINRA Guidance on Breakpoints: FINRA Breakpoints.

Step by Step Explanation:

Turnover Ratio: Indicates how frequently the fund manager buys and sells securities. A high turnover ratio may result in higher capital gains distributions, impacting tax efficiency.

Incorrect Options:

B: Sales charges affect cost but not tax efficiency.

C: Commission details are unrelated to the fund’s tax efficiency.

D: Projections of distributions are speculative and not disclosed under regulations.

References:

SEC Mutual Fund Guide: SEC Mutual Funds.

Step by Step Explanation:

National Securities Clearing Corporation (NSCC): A subsidiary of the Depository Trust & Clearing Corporation (DTCC), the NSCC handles the clearance and settlement of broker-to-broker equity, corporate bond, municipal bond, and UIT transactions.

Incorrect Options:

A: The SEC oversees regulatory compliance but does not settle trades.

B: FINRA is a self-regulatory organization, not a clearing entity.

C: The Federal Reserve manages monetary policy and banking but is not involved in securities settlement.

References:

DTCC Overview of NSCC: DTCC NSCC.