Series 51

Now Effective: MSRB Rule G-37

On August 17, 2016, MSRB Rule G-37, known as the “pay to play” rule, will be extended to apply to municipal advisors. Continue reading

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On August 17, 2016, MSRB Rule G-37, known as the “pay to play” rule, will be extended to apply to municipal advisors.

The rule has two main components. First, it prohibits municipal securities dealers and municipal advisors from engaging in certain types of business with a municipality if they have made political contributions to an official of the municipality. This ban on business lasts two years from the date of the triggering contribution. Second, the rule requires municipal securities dealers and municipal advisors to disclose specific information related to political contributions.

The pay to play rule does carve out an exception for small contributions in elections by municipal finance professionals (MFPs) and municipal advisory professionals (MAPs) who are entitled to vote for an elected official. MFPs and MAPs are allowed to contribute up to $250 per election in which they are entitled to vote.

MSRB Rule G-37 is covered in Solomon Exam Prep Series 50, Series 51, Series 52, and Series 53 study materials. For more information, visit www.SolomonExamPrep.com or call us at 503-601-0212.

Series 51 Live Class – Portland, OR

Do you need to take the Series 51 MSRB Municipal Fund Securities Limited Principal Qualification Exam? This two-day crash course in Portland, Oregon will help! Continue reading

Series 51 Exam Study Guide – New Edition

Solomon Exam Prep announces publication of the 2nd edition of The Solomon Exam Prep Guide to the Series 51 Municipal Fund Securities Exam. Written in clear English with practice questions, exercises and visual aids sprinkled throughout, the comprehensive Solomon Exam Prep Guide will get you on track to passing the Series 51 Municipal Fund Securities Limited Principal exam. Continue reading

Do you need to know about qualified tuition plans, arbitrage rules and LGIP tax-exempt status? Do SMMPs, OMSJs, and “otherwise independent persons” sound meaningful to you? If you answered yes to these questions, then you probably work in the municipal fund securities industry and you need to take the MSRB Series 51 exam.

Solomon Exam Prep announces publication of the 2nd edition of The Solomon Exam Prep Guide to the Series 51 Municipal Fund Securities Exam. Written in clear English with practice questions, exercises and visual aids sprinkled throughout, the comprehensive Solomon Exam Prep Guide will get you on track to passing the Series 51 Municipal Fund Securities Limited Principal exam.

According to Solomon Exam Prep President Jeremy Solomon, many underestimate the Series 51 exam because it’s only 60 questions long. Says Solomon: “The good thing about a shorter exam like the Series 51 is that it’s only 60 questions and it doesn’t cover as much material as other securities exams, such as the Series 7 or the Series 65. The bad thing about the Series 51 is that it’s only 60 questions and there’s less margin for error. What makes the Series 51 particularly challenging is that it covers topics that most individuals, even securities professionals, have little knowledge of: the supervision of municipal fund securities activities. Topics include LGIPs, arbitrage bonds, qualified tuition plans and the regulation of political contributions. That’s why a good text and putting in enough study time are absolutely necessary if you want to pass the Series 51 exam and achieve the Municipal Fund Limited Principal registration.”

The Solomon Exam Prep Guide to the Series 51 Exam, 2nd edition includes:

New and updated MSRB rules, per the latest MSRB exam outline

Expanded arbitrage rebate section

Discussion of A, B, and C shares and breakpoint sales in relation to 529 plans

Expanded sections on transferring funds from other savings vehicles into 529 plans

Expanded discussion of municipal fund securities principal responsibilities

Expanded discussion and examples of the pay-to-play rule

Expanded discussion of out-of-state disclosure rules for 529 plans

Updated suitability section based on new suitability rule and its application

More examples, tables, figures, exercises and practice questions

Solomon Exam Prep has helped thousands of financial professionals pass their FINRA, NASAA, and MSRB securities regulatory exams including the Series 6, 7, 24, 26, 27, 28, 51, 52, 53, 55, 62, 63, 65, 66, 79, 82, and 99. The Solomon Exam Prep training system includes print and digital Exam Study Guides, Online Exam Simulators, Audiobooks, and Video Lectures to address the learning needs of all kinds of test-takers.

Solomon Exam Prep is led by founders Jeremy and Karen Solomon, both of whom maintain a lifelong commitment to advancing learning and education. Solomon Exam Prep draws from a pool of seasoned educators, practitioners and communicators who are experienced in both investment education and the process of adult learning.

Bank Loan Disclosures on EMMA

EMMA, the Electronic Municipal Market Access website, now allows issuers to voluntarily share bank loan disclosure information online. Continue reading

EMMA, the Electronic Municipal Market Access website, now allows issuers to voluntarily share bank loan disclosure information online.

EMMA was created by the MSRB to give investors online access to official statements for municipal bonds, as well as other disclosure documents. By adding the ability for issuers to share bank loan disclosure information, the MSRB is helping to provide investors with more transparency and more information with which to approach the municipal market.

The information can be posted on the issuer’s customized homepage. Getting it displayed is a two-step process. First, the issuer must submit the bank loan disclosure via the EMMA Dataport Submission Portal. Once the information is submitted, it can be published on the Customized Issuer Homepage by using the Issuer Dashboard.

Investors will find bank loan disclosures and other documentation under the Continuing Disclosure tab on the issuer’s customized homepage.

EMMA is covered on the Series 7, 50, 51, 52, and 53 exams. For more information about EMMA and the services it provides, please visit: http://emma.msrb.org/aboutemma/overview.aspx

Series 51 Online Exam Simulator Hits New Milestone

We are proud to announce that our Online Exam Simulator for the Series 51 has now reached over 1,000 test questions! Continue reading

One year ago Solomon Exam Prep published study materials for the MSRB exams. Since publication we have been consistently adding to our material, specifically our Online Exam Simulator database. We are proud to announce that our Online Exam Simulator for the Series 51 has now reached over 1,000 test questions! This means that a student can take 16 full practice exams without seeing a repeat question. This is a huge milestone and one we are proud to share.

We are constantly updating and adding to all of our material in an effort to give our students the best chance of passing their exams. The Series 51 has been a tricky exam, but we have learned a lot over the past year and adjusted our materials accordingly. We are excited to reach this milestone and look forward to reaching many more!

Study Question of the Month – January

This month’s study question from the Solomon Online Exam Simulator question database is now available. Submit your answer for a chance to win a $10 Starbucks gift card! Relevant to the Series 7, 24, 26, 27, 51, 52, 53, 62, 79, 82, 99. –ANSWER POSTED– Continue reading

This month’s study question from the Solomon Online Exam Simulator question database is now available.

***Submit your answer to info@solomonexamprep.com to be entered to win a $10 Starbucks gift card.***

Question (Relevant to the Series 7, Series 24, Series 26, Series 27, Series 51, Series 52, Series 53, Series 62, Series 79, Series 82, Series 99)

Jon and Jenny are married. They each have an individual account and they have a joint account owned by both of them. What is the combined maximum SIPC coverage for all their accounts?

Answers:

A. $500,000

B. $1,000,000

C. $1,500,000

D. $750,000

Correct Answer: C. $1,500,000

Rationale: SIPC covers a maximum of $500,000 per “separate customer” at a broker-dealer or clearing firm including up to $250,000 in cash.Total coverage can be higher for multiple accounts if the accounts are considered to be held by separate customers. There are five categories of separate customers defined by SIPC. These categories include 1) individual accounts, 2) joint accounts, 3) accounts held by executors, administrators, and guardians/custodians/conservators (such as UGMA accounts), 4) accounts held by corporations, partnerships, or unincorporated associations, and 5) trust accounts. Thus, two individual accounts held by two different people, and one joint account would be considered three separate customers by the SIPC, and therefore subject to a maximum of $1,500,000 of coverage.

Congratulations! This month’s winner is Abe B.

Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.

MSRB Rule Changes: Series 51, 52, and 53

The MSRB has added two new rules effective July 9, 2014. They are Rule G-47 (Time of Trade Disclosure) and Rule G-48 (Transactions with Sophisticated Municipal Market Professionals). MSRB has also amended Rule G-3 (Classification of Principals and Representatives) and Rule G-19 (Suitability), effective September 30, 2014. These four changes coordinate MSRB rules with FINRA rules and remove regulatory redundancies. Continue reading

The MSRB has added two new rules effective July 9, 2014. They are Rule G-47 (Time of Trade Disclosure) and Rule G-48 (Transactions with Sophisticated Municipal Market Professionals). MSRB has also amended Rule G-3 (Classification of Principals and Representatives) and Rule G-19 (Suitability), effective September 30, 2014. These four changes coordinate MSRB rules with FINRA rules and remove regulatory redundancies.

MSRB Rule G-3. MSRB narrows the definition of Limited Representative – Investment Company and Variable Contracts Products (Series 6). Under FINRA rules, a Series 6 license only allows individuals to be involved in the purchase and sale of funds and variable products. The new MSRB rule will now be consistent with the FINRA rules. Representatives who want to participate in broader activities, such as underwriting, research and investment advice must now take and pass the Municipal Securities Representative Qualification Examination (Series 52).

Amended Rule G-3 also eliminates the designation of Municipal Securities Financial and Operations Principal (FINOP). Since municipal securities dealers that require a FINOP are also FINRA members and since FINRA has similar FINOP requirements, Rule G-3 eliminates the redundancy by removing its separate FINOP designation.

MSRB Rule G-19. MSRB’s amended suitability rule conforms to FINRA’s own recent changes to its rule. Specifically, the amended rule recognizes three components to a broker-dealer’s suitability obligations. First, a broker-dealer must understand the complexity and risks of a security or investment strategy and consciously decide its suitability for at least some investors. Second, it must reasonably believe that a recommendation is suitable for a particular customer based on the customer’s personal and investment profile. Third, when a broker-dealer has control over a customer account, it must reasonably believe that a series of recommended securities transactions are not excessive.

MSRB Rule G-47. This new rule requires broker-dealers to disclose to its customers all material information about a transaction and the security at or prior to the time of trade. Information is considered “material” if a reasonable investor is likely to consider it important in making an investment decision. Disclosures must include a complete description of the security and any facts important to assessing the potential risks of the investment.

MSRB Rule G-48. Rule G-48 exempts broker-dealers from any obligation to disclose material information to customers who are sophisticated municipal market professionals (SMMPSs). It also exempts broker-dealers from informing an SMMP that the price of a secondary market agency transaction is fair and reasonable, as long as the broker-dealer has not recommended the transaction or exercised discretion as to its execution. Finally, Rule G-48 exempts broker-dealers from the obligation to perform a customer-specific suitability analysis for an SMMP.

Study Question of the Week: August 14, 2014 Edition

This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 7, 51, 52, 53, 62, 82, and 99. –ANSWER POSTED– Continue reading

This week’s study question from the Solomon Online Exam Simulator question database is now available.

Study ? of the Week

Question (Relevant to the Series 7, Series 51, Series 52, Series 53, Series 62, Series 82, and Series 99):

When money is regularly put into an escrow account in order to redeem the bonds before maturity this is called:

Answers:

A. A sinking fund redemption

B. Advance refunding

C. Defeasement

D. A make whole provision

Correct Answer: A. A sinking fund redemption

Rationale: A sinking fund redemption requires the issuer to set money aside regularly in a reserve account for the redemption of the bonds before maturity.

Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.

Study Question of the Week: July 9, 2014 Edition

This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 7, 51, 52, 53, 62, 79, 82, and 99. –ANSWER POSTED– Continue reading

This week’s study question from the Solomon Online Exam Simulator question database is now available.

Study ? of the Week

Question (Relevant to the Series 7, Series 51, Series 52, Series 53, Series 62, Series 79, Series 82, and Series 99):

When new bonds are issued with the purpose of using the proceeds to pay off older bonds, it is called?

Answers:

A. Refunding

B. Defeasement

C. A sinking fund redemption

D. A bond SWAP

Correct Answer: A. Refunding

Rationale: A bond refunding is the replacement of existing bonds with new “refunding“ bonds. The issuer of refunding bonds often seeks to lower its interest payments by paying off its previously issued (refunded) bonds with newly issued bonds that pay interest at a lower rate. Another reason to refund existing bonds may be to release the issuer from legal covenants or restrictions in the original indenture.

Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.

Study Question of the Week: July 2, 2014 Edition

This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 7, Series 51, Series 52, Series 53, and Series 62. –ANSWER POSTED– Continue reading

This week’s study question from the Solomon Online Exam Simulator question database is now available.

Study ? of the Week

Question (Relevant to the Series 7, Series 51, Series 52, Series 53, and Series 62):

A flat bond is a bond that:

Answers:

A. Has a fixed interest rate

B. Is quoted in terms of its yield-to-maturity

C. Has no call provision

D. Does not trade with accrued interest

Correct Answer: D. Does not trade with accrued interest

Rationale: Bonds are quoted at a flat price, also called a clean price, meaning that accrued interest is not factored into the quotation. Bonds generally trade at a “dirty” price, with accrued interest factored in. Sometimes bonds trade flat, however, meaning that the bond carries no accrued interest. Bonds in default and zero coupon bonds are two examples of bonds that trade flat.

Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.