Series 66 - M's and N's

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Series 66 - M's and N's
2014-03-02 01:30:04
Series 66

Series 66 Definitions and terms
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  1. the lead underwriter in the underwriting syndicate formed to purchase and distribute securities of an issuer; acts as agent for the syndicate.
    Managing Underwriter
  2. A securities account at a broker/dealer that allows customers to purchase securities and deposit only 50% of the purchase price after initial requirement are satisfied.
    Margin Account
  3. To open a margin account, a customer must sign a ___ ____. This gives the broker/dealer the right to sell the customer out if a margin call is not met.
    Margin Agreement/Customer Agreement AKA Hypothecation Agreement
  4. It is a demand by a broker/dealer to a customer to deposit cash or securities. If a customer does not meet the ___ ___, his securities will be liquidated by theĀ  broker/dealer.
    Margin Call
  5. Valuing a security or a portfolio at is current market value.
    Mark to the Market
  6. Actions taken by the Federal Reserve Board to control the amount of money and credit in the economy.
    Monetary Policy
  7. refers to the trading market for short-term debt obligations. Investors who purchase this market's instruments directly are creditors and receive interest and a return of principal at maturity.
    Money Market
  8. Refers to a demand deposit plus currency in circulation. An increase in the ___ ___ would lead to lower interest rates and higher domestic inflation. A decrease in the ___ ___ would lead to higher interest rates and lower domestic inflation.
    Money Supply
  9. Tax exempt bonds issued by state and local governments such as states, cities, towns, counties, and school districts.
    Municipal Bonds
  10. Investors interested in mutual funds should compare funds based on investment objectives, investment policies and quality of management (track record). The mutual fund's risk factors should be looked at. Other factors an investor should consider include sales charges, reinvestment programs, minimum purchase requirement, conversion privileges, withdrawal privileges, Expense Ratios and the taxability of fund distributions.
    Mutual Fund Comparison
  11. A self-regulatory organization established under the Maloney Act. It is supervised by the SEC and its members include almost all firms dealing in over-the-counter markets.
    NASD (National Association of Securities Dealers)
  12. NASD
    (National Association of Securities Dealers)
  13. NASD Rules of Fair Practice state that 5% is a reasonable guideline in mark-ups and mark-downs but that many factors must be considered to determine if such a mark-up or mark-down is reasonable.
    NASD Mark-Up (Mark-Down) Policy
  14. The automated Quotation System, owned and operated by the NASD. Using a computerized system, it provides broker/dealers with price quotations for OTC securities and many securities listed on the NYSE. These quotes are published in the financial section of most newspapers.
  15. short-terms CD's having a large dollar amount which are issued by large banks and purchased primarily by institutional investors and corporations. They are payable to the bearer or to the depositor. In the secondary market, they trade in round lots of $5 million. Most have less than a six month original maturity with a minimum original maturity of 14 days.
    Negotiable Certificate of Deposit (CD)
  16. New Account Report - completed by the broker detailing facts about a new client's financial circumstances and investment objectives.
    New Account Form
  17. Investment Companies which do not have a sales charge. Investors generally do not purchase these funds through a broker/dealer, but directly through a fund company.
    No-Load Fund
  18. The percentage found by dividing the annual dollar income paid by a fixed-income security by the security's par value.
    Nominal Yield
  19. Gives discretion to the floor broker as to time and price. Floor broker uses his best judgment concerning the proper time to bid or offer stock. Specialists cannot accept a __ ___ ___.
    Not Held Order
  20. is published in a local newspaper and other publications by the municipality inviting bids to be made by investment bankers. It is normally available from the issuer, underwriter or approving attorney. New issues of municipal bonds must usually be sold by a competitive bidding method.
    Notice of Sale
  21. Refers to the registration of a security at the state level being satisfied by submitting a notice to the Administrator that the company has issued securities previously and intends on issuing a new security.
  22. The NYSE and NASD Require that a margin must be maintained which is at least 25% of the market value of securities in a margin account. If the market value of securities purchased on margin declines below this minimum, there is a maintenance call requesting additional equity and, if the customer does not comply, the broker may sell the margined stock and close out the customer.
    NYSE Maintenance Requirement
  23. The Exchange requires that orders for nine bonds or less be sent to the floor of the NYSE.
    NYSE Nine Bond Rule
  24. Also referred to as the syndicate manager.
    Managing Underwriter
  25. Examples of Money Market Instruments (securities)
    • Treasury Bills
    • Negotiable
    • Certificates of Deposit from domestic and foreign banks
    • Commercial Paper
    • Bankers' Acceptances
    • Repurchase Agreements
    • Federal Funds