Updated Dec-2023 Premium Series63 Exam Engine pdf - Download Free Updated 251 Questions
Authentic Series63 Dumps With 100% Passing Rate Practice Tests Dumps
NEW QUESTION # 27
Which of the following is a security as defined by the Uniform Securities Act (USA)?
- A. Both A and B are securities as defined by the Uniform Securities Act.
- B. a futures option contract on wheat
- C. a debenture
- D. a term life insurance policy
Answer: A
Explanation:
Explanation
Both a debenture and a futures option contract on wheat are securities as defined by the USA. A debenture is a long-term, unsecured debt instrument and is specifically listed as a security in the Act. Although commodity futures contracts are not considered to be securities as defined by the Act, options on commodity futures contracts are.
NEW QUESTION # 28
Ms. Ding is an administrative assistant to the manager of a mutual fund. Most of her day is spent entering
data onto a spreadsheet for her boss and answering phone calls. Some of the calls require her to provide
information about the some of the fund's financial aspects, such as its closing net asset value on the
previous day. What type of registration does Ms. Ding require in order to perform her duties?
- A. Ms. Ding needs to apply for registration as an investment adviser representative since she is providing
information about a specific mutual fund. - B. Ms. Ding will need to apply for registration as both an agent and an investment adviser representative
in this case since she is providing information about a mutual fund. - C. Ms. Ding needs to apply for registration as an agent since she is providing financial information.
- D. Ms. Ding does not need to apply for any type of registration. She is merely supplying information and is
not engaged in the purchase or sale of the fund shares.
Answer: D
Explanation:
Since Ms. Ding is an administrative assistant who is merely providing some information
about the fund and is not engaging in the purchase or sale of the fund shares, she does not need to apply
for any type of registration. An employee who simply provides price and/or some other pertinent
information to the public, but who does not engage in the purchase or sale of securities to the public and
does not receive a commission based on the sale of securities is not considered to be an agent or an
investment adviser.
NEW QUESTION # 29
Once you have passed the Series 63 examination, which entity must then approve your application to sell
securities?
- A. SEC
- B. the state administrator
- C. NASAA
- D. FINRA
Answer: B
Explanation:
Once you have passed the Series 63 exam, it is the state administrator who can approve or
deny your registration. NASAA developed the Uniform Securities Agent State Law Examination and
FINRA administers it. The SEC is not a party to the state registration process.
NEW QUESTION # 30
Which of the following is not a security, as defined by the Uniform Securities Act?
I. an option contract
II. a futures contract on gold
III. a 401K plan
IV. a variable annuity
- A. None of the selections listed are securities.
- B. Only Selections II and III are not securities.
- C. Selections II, III and IV are not securities.
- D. Only Selection III is not a security.
Answer: B
Explanation:
Explanation
Only Selections II and III are not securities. Neither retirement plans nor commodity futures contracts are deemed to be securities by the Uniform Securities Act. A 401K plan may be invested in securities, but it is not a security itself. A gold futures contract is a contract between two parties for the delivery of the underlying asset, gold. The profits (or losses) are not dependent on the performance of an outside party, which is a critical element, based on a 1946 U.S. Supreme Court decision, which defines a security as "an investment of money. .
. with profits to come solely from the efforts of others."
NEW QUESTION # 31
An investment adviser or its representative may
- A. only exercise any discretionary power in the purchase or sale of securities for a client's account after receiving written authority prior to the execution of the transactions.
- B. exercise discretionary power in the purchase or sale of securities for a client's account only after.
- C. exercise discretionary power in the purchase or sale of securities for a client's account as long as.
- D. exercise discretionary power in the purchase or sale of securities for a client's account as long as it receives written discretionary authority over the account within 10 business days of the first discretionary transaction placed, assuming oral authority has already been given.
Answer: D
Explanation:
Explanation
An investment adviser or its representative may exercise discretionary power in the purchase or sale of securities for a client's account as long as it receives written discretionary authority over the account within 10 business days of the first transaction placed, assuming oral authority has already been given.
NEW QUESTION # 32
BigCash Broker-Dealers is registered in the state and is in the process of purchasing a smaller broker-dealer, Target Investments, as a subsidiary. Target Investments is also registered in the state.
After completing the purchase, what actions must BigCash take regarding registration of its new subsidiary?
- A. BigCash will need to pay the annual filing fees required by the Administrator, but will not need to file a new registration application.
- B. BigCash must file a new application with the state to register its new subsidiary and must also pay the annual filing fees required by the Administrator.
- C. BigCash must file a new application with the state to register its new subsidiary, but will be able to utilize the remainder of any annual filing fees that Target Investments had paid for the year.
- D. BigCash need do nothing since Target Investments was already duly registered with the state as a broker-dealer.
Answer: C
Explanation:
Explanation
After completing the purchase, BigCash will have to file a new registration application for its new subsidiary, but BigCash can utilize the remainder of any annual filing fees that Target Investments had paid for the year.
Although registration applications are never transferable, annual filing fees are.
NEW QUESTION # 33
"Federal covered securities" were defined and exempted from state registration requirements by the:
- A. National Securities Markets Improvement Act of 1996 (NSMI)
- B. Uniform Securities Act (USA.)
- C. Gramm-Leach-Bliley Act of 1999 (GLBA.)
- D. National Conference of Commissioners on Uniform State Laws (NCCUSL.)
Answer: A
Explanation:
The National Securities Markets Improvement Act of 1996 defined "federal covered
securities" and exempted them from state registration requirements. The Gramm-Leach-Bliley Act
focused on financial institutions and provided for their registration as broker-dealers under certain
conditions. The National Conference of Commissioners on Uniform State Laws (NCCUSL) is the
organization that drafted the Uniform Securities Act, which is not comprised of actual laws itself, but is,
instead, just a guideline for each state to use when formulating its own securities laws.
NEW QUESTION # 34
Which of the following does not describe a prohibited activity by investment advisers and their representatives, according to NASAA Model Rules?
- A. A new client comes to Simon LaGree for investment advice. The client has $25,000 to invest. Simon tells the client that it will cost the client $5,000 to have a customized financial plan developed for him, but after that the client needs to pay only 5% of the total value of the assets under management each quarter.
- B. All of the above describe prohibited practices.
- C. The agreement that Simon LaGree has his clients sign indicates that LaGree uses SecureMoney Broker-Dealers in executing trades for his clients and that, in return, LaGree receives software from the broker-dealer that allows LaGree to perform some fundamental and technical analysis.
- D. A 72-year-old retired social worker comes to Simon LaGree for investment advice. She has $50,000 to invest. Simon recommends she invest half of it in an international growth mutual fund and half in a variable annuity.
Answer: C
Explanation:
Explanation
It is not prohibited for LaGree to receive the software from SecureMoney in return for executing trades through that broker-dealer since LaGree has disclosed this to his clients. An investment adviser is permitted to receive soft dollars from broker-dealers in return for executing trades through them, as long as the client is informed of the arrangement and the soft dollars will benefit both the client and the adviser, which is the case in this instance since the software gives LaGree the ability to do research in order to better advise his client.
Choice A is clearly prohibited since it constitutes an "unreasonable advisory fee." In Choice B, LaGree is making unsuitable recommendations to his client. A 72-year-old retired social worker is likely to have a greater-than-average need for liquidity to pay for unexpected items, such as medical bills. Variable annuities are designed to be long-term investments, not short-term investments, so they would not meet this need. They typically have high surrender penalties that the client would be subject to if she needed to make withdrawals within, say, the next 10 years. Likewise, international growth funds are not liquid investments. International growth mutual funds are invested in foreign stocks and are riskier than average, and are, thus, not suitable investment vehicles for the typical 72-year-old retired social worker.
NEW QUESTION # 35
Which of the following funds can an agent indicate is "no load?"
- A. Both A and C can be advertised as "no load" funds.
- B. a fund with no front-end load that has 12b-1 fees equal to 0.10% of the average net assets of the fund
and a rear-end load that varies depending on how long the investor has held the shares. - C. a fund with no front-end or back-end load that has 12b-1 fees equal to 0.25% of the average net assets
of the fund. - D. a fund with no front-end or back-end load that has 12b-1 fees equal to 0.30% of the average net assets
of the fund.
Answer: C
Explanation:
A fund with no front-end or back-end load that has 12b-1 fees equal to 0.25% or less of the
average net assets of the fund is considered a no load fund. In Choice A, the 12b-1 fees exceed 0.25%,
and in Choice B, there is a rear-end load.
NEW QUESTION # 36
A limited power-of-attorney gives the designated person the right to
I. order the sale of an asset owned by the account holder and have a check written to the account holder for the amount of the proceeds.
II. obtain account statements, including tax statements, on behalf of the account holder.
III. order the purchase of an asset for the account holder's account.
- A. II and III only
- B. I, II, and III
- C. I and II only
- D. I and III only
Answer: A
Explanation:
Explanation
Only Selections II and III are true. A limited power-of-attorney gives the designated person the right to obtain account statements, including tax statements, on behalf of the account holder and to order the purchase of an asset for the account holder's account. Only a full (or unlimited) power-of-attorney allows the designated person to withdraw any proceeds from the account.
NEW QUESTION # 37
An investment adviser
I. provides investment advice to clients.
II. sells securities to clients.
III. buys and sells securities in their clients' accounts for the clients.
- A. I only.
- B. I, II, and III.
- C. I and III only.
- D. I and II only.
Answer: C
Explanation:
An investment adviser provides investment advice to clients and may also buy and sell
securities in their clients' accounts for the clients. He does not, however, sell securities to his clients.
NEW QUESTION # 38
Jack Bean is employed by Giant Investment Advisers, LLC. His job duties include advising clients on the
asset allocations of their portfolios. Jack Bean is
- A. an investment adviser representative.
- B. an investment adviser.
- C. an agent.
- D. an administrative assistant.
Answer: A
Explanation:
As an employee of Giant Investment Advisers who provides investment advice to clients,
Jack Bean is an investment adviser representative. Giant is the investment adviser. Agents are employed
by broker-dealers.
NEW QUESTION # 39
Which of the following would be an unsuitable recommendation for your 68-year-old client?
- A. a high quality corporate bond fund
- B. a deferred annuity
- C. an S&P 500 Index mutual fund
- D. a Treasury Inflation Protected Security (TIPS)
Answer: B
Explanation:
A deferred annuity would be an unsuitable recommendation for your 68-year-old client.
These annuities charge significant penalties for early withdrawals-and "early" can mean before 10 years,
or even longer. A 68-year-old client may have the need to withdraw his money early to make medical
payments.
NEW QUESTION # 40
Which of the following entities must sign a "consent to service of process," thereby allowing the Administrator to receive legal documents that are meant to be served to the entity in place of that entity?
I. agents
II. investment advisers
III. investment adviser representatives
IV. broker-dealers
- A. II and IV only
- B. I and IV only
- C. II and III only
- D. I, II, III, and IV
Answer: D
Explanation:
Explanation
Agents, investment advisers, investment adviser representatives, and broker-dealers must all sign a consent to service of process, allowing the Administrator to receive legal documents in their stead. The consent to service of process must accompany the application for registration with the state or the documentation provided with a notice filing when permitted.
NEW QUESTION # 41
Until yesterday Maddie was a registered agent employed by the broker-dealer, QuikDeals. Yesterday
afternoon, issues that had been brewing between her and another employee of the firm came to a head,
and Maddie impulsively quit her job. At this point,
- A. Maddie will have to file a new application for registration with the Administrator upon finding
employment with another broker-dealer since she is no longer considered to be a registered agent by the
state. - B. Maddie is required to call all of her clients at QuikDeals to inform them she is no longer employed
there. - C. Maddie has thirty days to find a job with another broker-dealer, or she will need to file a new registration
application. - D. Maddie has sixty days to find a job with another broker-dealer, or she will need to file a new registration
application.
Answer: A
Explanation:
When Maddie quit her job, her status as a state-registered securities agent was
automatically terminated, and she will need to file a new application for registration with the Administrator
upon obtaining a position with another broker-dealer. If she does so within thirty days, her registration will
become effective as soon as she has filed her application and paid her application fee. While she is
required to notify the Administrator that she has terminated her employment with QuikDeals, there is no
requirement that she contact any of her clients at QuikDeals.
NEW QUESTION # 42
Cal Turner calls his client and recommends that the client sell his shares in the Alpha High Quality Bond
Fund and use the proceeds to buy shares in the Omega High Quality Bond Fund. Cal has done nothing
unethical if his recommendation is based on the fact that
- A. It would always be unethical for Cal to recommend that a client sell shares in one fund in order to buy
shares of another fund that has the same investment objective. - B. the Alpha Fund has been performing poorly relative to other funds in the same category.
- C. the Omega Fund has a front-end load.
- D. the Alpha Fund has a back-end load.
Answer: B
Explanation:
Cal has done nothing unethical if his recommendation that a client sell his shares in the
Alpha Fund and buy shares of the Omega Fund is due to the fact that the Alpha Fund has been
performing poorly relative to other funds in the same category. While past performance is no guarantee of
future performance, a client may not want to hang on to a fund that isn't returning as much as its
competition.
NEW QUESTION # 43
Elizabeth is the owner of Lizbeth Investment Advisers, a small, state-registered investment advisory firm. She has decided that her firm needs a niche and has learned that a consulting group is coming to the area and offering a 3-day seminar on asset allocation for senior citizens offered by Advantage for Retirement Persons (ARP). The seminar will cost $1,000 per individual, but after attending the seminar, each attendee will receive a certificate verifying their involvement in the program. Elizabeth decides this is the niche she has been looking for and signs up herself and her three investment adviser representatives for the program. After attending the seminar and receiving their certificates, Elizabeth and her team can
- A. indicate that they are certified by the ARP program since money was paid for their attendance.
- B. do none of the above.
- C. represent themselves as certified senior citizen investment advisers.
- D. have the words "Senior-Citizen Investment Specialists" printed on their business cards.
Answer: B
Explanation:
Explanation
After attending the ARP seminars on asset allocation for senior citizens, Elizabeth and her team cannot represent themselves as certified senior citizen investment advisers, print "Senior-Citizen Investment Specialists" on their business cards, or indicate that they are certified by the ARP program. Under the NASAA model rules, their attendance does not entitle them to say they are in any way especially certified to serve senior citizens. The attendance certification they received does not have any competency requirements attached.
NEW QUESTION # 44
Which of the following securities would not necessarily be exempt from state registration?
- A. a bond issued by another state's employees' credit union
- B. a stock listed as a NASDAQ National Market Issue.
- C. a stock listed on the Tokyo Stock Exchange
- D. a bond guaranteed by the Canadian government
Answer: C
Explanation:
Explanation
Stocks listed on the Tokyo Stock Exchange would not necessarily be exempt from state registration. Stocks that are registered with the SEC, such as NASDAQ National Market Issue stocks, securities issued or guaranteed by the Canadian government, and securities issued or guaranteed by banks or credit unions are all exempt.
NEW QUESTION # 45
Under which of the following scenarios can a client legitimately sue a purported professional in the
securities industry and expect an award for damages?
I. The securities were sold by an agent whose registration was not yet effective with the state, but who
had already applied for registration.
II. The security was a variable annuity, and the sales representative neglected to reveal the details of the
surrender clause to the client.
III. The security was the stock of a company, the stock had recently been registered with the state for sale,
had been granted registration, and the selling agent had told his client that the security had been
state-approved for sale.
- A. I, II, and III
- B. II and III only
- C. I and III only
- D. I only
Answer: A
Explanation:
All of the selections are scenarios describing instances in which a client can legitimately sue
a purported professional in the securities industry and expect an award for damages. A client can
legitimately sue a purported professional in the securities industry and expect an award for damages if the
agent is not yet effectively registered to effect securities transactions in the state; if the professional has
neglected-intentionally or otherwise-to inform the investor of all the relevant information involving the
security, such as any surrender clause involved; or if the agent has indicated that a state-registered
security has in any way been approved by the state.
NEW QUESTION # 46
Which of the following compensation arrangements between an investment adviser and an individual client with a net worth of $600,000 would be disallowed?
- A. The client agrees to pay the investment adviser an hourly fee of $60.00.
- B. The investment adviser will receive 0.1% of the gross capital gains earned on the portfolio each quarter.
- C. The investment adviser will receive 0.1% of the total value of the client's assets under management as of the end of each month.
- D. All of the above are legitimate compensation arrangements between and investment adviser and an individual client with a net worth of $600,000.
Answer: B
Explanation:
Explanation
A compensation arrangement between an investment adviser and an individual client with a net worth of
$600,000 that stipulates the adviser will receive 0.1% of the gross capital gains earned on the portfolio would be disallowed. An investment adviser of an individual client cannot be compensated with a share of the capital gains earned on the portfolio unless that client has a net worth of at least $1.5 million or has at least $750,000 invested through that investment adviser.
NEW QUESTION # 47
Maddie, a registered agent affiliated with broker-dealer QuikDeals, quit her job on the spur of the moment.
Under the guidelines of the Uniform Securities Act (USA), who is responsible for notifying the Administrator?
- A. Both QuikDeals and Maddie are responsible for notifying the Administrator.
- B. QuikDeals has the sole responsibility for notifying the Administrator. Maddie is no longer deemed to be an agent after she terminated her relationship with QuikDeals, so she need do nothing.
- C. It depends. If Maddie becomes affiliated with another broker-dealer within thirty days, then she must notify the Administrator of her termination with QuikDeals and her current affiliation with the new firm.
Otherwise, only QuikDeals must notify the Administrator. - D. Maddie has the sole responsibility for notifying the Administrator.
Answer: A
Explanation:
Explanation
Under the guidelines of the USA, when Maddie quits her job as a registered agent with QuikDeals, both QuikDeals and Maddie are responsible for notifying the Administrator. Both the broker-dealer and the agent involved are required to notify the Administrator whenever an agent begins or ends her association with the broker-dealer.
NEW QUESTION # 48
......
Verified Pass Series63 Exam in First Attempt Guaranteed: https://www.testsdumps.com/Series63_real-exam-dumps.html
FINRA Series63 Real Exam Questions Guaranteed Updated Dump from TestsDumps: https://drive.google.com/open?id=1Tc8LlkPxVU4nYAI1emSrQD1R_l_rBJFG
