January Study Question of the Month

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

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

***Comment below or submit your answer to info@solomonexamprep.com to be entered to win a $20 Starbucks gift card.***

This question is relevant to the SIE, Series 6, 7, 22, 24, and 82 exams.

Question:

Which of the following people would be considered a specified adult?

Answer Choices:

A. A 16 year old with autism

B. A 30 year old

C. A 60 year old with a heart condition

D. An 18 year old in a coma

SEC Announces Major Revisions to Registration Exemptions Aimed at “Harmonizing” Regulation A Offerings, Regulation D Private Placements, and Crowdfunding

On November 2, the SEC announced a collection of rule changes meant to, in the announcement’s words, “harmonize, simplify, and improve” its “overly complex exempt offering framework.” Continue reading

On November 2, the SEC announced a collection of rule changes meant to, in the announcement’s words, “harmonize, simplify, and improve” its “overly complex exempt offering framework.” The changes affect Regulation A, which governs small public offerings; Regulation D, which governs private placements; and Regulation CF, which governs crowdfunding. This system of exemptions allows various small offerings to avoid the normal registration process required by the Securities Act.  
 
The rule changes should provide a clearer choice as to which exemption is most appropriate to an issuer, based on how much the issuer needs to raise and other factors.
 
The changes also seek to clarify how issuers can avoid “integration” of exempt offerings. Integration is the risk that exempt offerings will be considered a single offering by the SEC, because the offerings are too similar.
 
Highlights of the changes include:
 
  • If two exempt offerings are conducted more than 30 days apart, they are almost always protected from integration.
  • An issuer can “test the waters” with potential investors before deciding which exemption it will use for an offering. Test-the-waters communications solicit interest in a potential offering before the issuer has filed anything with the SEC. Previously, an issuer could only test the waters after deciding that its potential offering would take place under Regulation A.
  • Caps on the amount that may be raised through these exemptions have been increased:
    • Crowdfunding: from $1.07 million to $5 million
    • Regulation A, Tier 2: from $50 million to $75 million 
    • Regulation D, Rule 504: from $5 million to $10 million
  • Make “bad actor” exclusions more consistent across different exemptions.
The rule changes will take effect early next year. Until the changes take effect, securities exam questions will continue to be based on the old rules. FINRA Exams affected by these rule changes include the SIE, Series 6, Series 7, Series 14, Series 22, Series 24, Series 65, Series 66, Series 79, and Series 82.

If You’re a Principal or Operations Professional, Your FINRA Exam Deadline May Be Extended

If you’re a newly promoted principal at your firm, FINRA may have just delivered you some good news. Continue reading

If you’re a newly promoted principal at your firm, FINRA may have just delivered you some good news.

In response to current events, FINRA has adopted a temporary rule change giving many new principals until December 31st to complete their FINRA exams.

To qualify for the extension, the principal must have been promoted from representative by her firm before September 3rd.

Among the principals included in the extension are General Securities Principals (Series 24), Financial and Operations Principals (Series 27 or 28), Investment Company/Variable Contract Limited Principals (Series 26), and Compliance Officers (Series 14).

The extension also applies to one rep-level license. Operations Professionals (Series 99) hired before September 3rd also have until December 31st to pass their exams.

The Solomon Exam Prep team is always on the lookout for how current developments affect the securities industry. For more updates from our Industry News blog, use the subscribe form on this page.

Now Available: Series 24 Audiobook, 4th edition

Solomon Exam Prep is excited to release the 4th edition of Solomon’s Series 24 Exam Audiobook. The Solomon Audiobook is a word-for-word reading of the 4th edition of Solomon’s Series 24 Study Guide.  Continue reading

Solomon Exam Prep is excited to release the 4th edition of the Solomon Series 24 Exam Audiobook.  The Solomon Audiobook is a word-for-word reading of the 4th edition of Solomon Exam Prep’s Series 24 General Securities Principal Exam Study Guide. 
 
Although the core content of the Solomon Series 24 Exam Study Guide is the same as the previous edition, Solomon Exam Prep has made the following changes in the 4th edition for this important FINRA principal exam:
 
  • Updated information related to new and changed FINRA rules
  • Added information on SEC Regulation Best Interest
  • Updated tax information for 2020
  • Updates to retirement plan information, most of which is related to the recently enacted SECURE Act which took effect on January 1, 2020 
  • Additional examples and questions to help reinforce important concepts
For those of studying for the FINRA Series 24 exam, Solomon’s Audiobook offers another great way to learn the Series 24 material. Because it’s available as both streaming audio and instant MP3 download, you can conveniently listen on the go with or without Internet access. Solomon Study Guides are written in easy-to-understand language, and Solomon Audiobooks are read by real people who are content experts. Audiobooks can be used in tandem with the Solomon Study Guide, Exam Simulator, and/or Video Lecture to create a well-rounded study experience benefitting a variety of learners. Curious about the many benefits of Solomon Audiobooks?  Visit our blog post to read more: https://solomonexamprep.com/news/study-tips/solomon-study-tip-listen-to-a-solomon-audiobook/
 
If you have a current digital subscription to the Solomon Series 24 Exam Audiobook, then you have been automatically updated to the 4th edition on your online Solomon account, at no additional charge. However, if you’d like to be reverted back to the 3rd edition, or if you have any questions about this update, please call us at 503-601-0212 or email info@solomonexamprep.com and we’ll be happy to help.
 
And if you’re planning to study for the Series 24 exam, you can explore Solomon Exam Prep’s Series 24 exam study materials here.  The Solomon Series 24 Audiobook is available as an individual item, and it is included in the discounted Audio Premium Package and Total Packages.

Market Circuit Breakers — A Post-Brexit Reminder

With post-Brexit vote market turmoil, it’s good to remember that the Securities Exchange Commission requires trading halts across US markets in the event that stocks fall more than specified percentages in one day. Continue reading

stop-634941_1280With post-Brexit vote market turmoil, it’s good to remember that the Securities Exchange Commission requires trading halts across US markets in the event that stocks fall more than specified percentages in one day. This information is also important to know if you are studying for securities licensing exam such as the Series 7, Series 24, Series 26, Series 62, Series 79, and the Series 65.

A market-wide trading halt can be triggered at three thresholds. These thresholds are triggered by steep declines in the S&P 500 Index. They are calculated based on the prior day’s closing price of the Index.

• Level 1 Halt—a 7% drop in the S&P 500 prior to 3:25 p.m. ET will result in a 15-minute cross-market trading halt. There will be no halt if the drop occurs at or after 3:25 p.m. ET.

• Level 2 Halt—a 13% drop in the S&P 500 prior to 3:25 p.m. ET will result in a 15-minute cross-market trading halt. There will be no halt if the drop occurs at or after 3:25 p.m. ET.

• Level 3 Halt—a 20% drop in the S&P 500 at any time during the day will result in a cross-market trading halt for the remainder of the day.

These halts apply to securities and options trading on all the exchanges as well as the OTC market. Levels 1 and 2 trading halts are permitted just once a day.

Solomon Exam Prep has helped thousands of financial professionals pass the Series 6, 7, 63, 65, 66, 24, 26, 27, 50, 51, 52, 53, 62, 79, 82 and 99 exams.

For more information call 503 601 0212 or visit http://www.solomonexamprep.com/

FINRA qualification exam restructure update

Panel discussion May 24, 2016 at the FINRA annual conference. John Kalohn, Joe McDonald and Roni Meikle from FINRA discussed coming restructure of qualification exams. Continue reading

Panel discussion May 24, 2016 at the FINRA annual conference. John Kalohn, Joe McDonald and Roni Meikle from FINRA discussed coming restructure of qualification exams.

Goals of exam restructure:

• Respond to industry and regulatory changes
• Reduce redundancy of content across exams
• Streamline exam process
• Minimize impact and change to the registration rules
• Ensure registered reps have a solid breadth of understanding of securities industry

Another goal appears to be a desire by FINRA and member firms to expand the number of people who can and will get licensed to work in the securities industry.

Exam restructure launch date has been postponed, at least a year, till January 2018 at the earliest.

Exams slated to be retired, will not be retired till 2018 restructure launch date. These include the Series 11 (Order Processing Assistant), Series 42 (Options Representative), Series 62 (Corporate Securities Representative) and Series 72 (Government Securities Representative) exams. The panel noted that only one person had taken the Series 72 in the past year.

Anyone holding registrations that are being retired (Series 11, Series 62, Series 72) will be able to continue to hold them until they leave industry for more than 2 years.

Series 17/37/38 Exams – FINRA will retire these exams and use the UK and Canadian certifications to exempt certificate holders from the Essentials Exam.

Exams that will remain as “Top-off” exams: Series 6, 7, 22, 57, 79, 82, 86/87 and 99. Top-off exams will be shorter than current exams.

Essentials Exam features:

Essentials exam currently envisioned to be 100 questions long.

Unlike the current system, you will not need to be associated with a member firm to take the Essentials Exam. In other words, you won’t need to have a job with a broker-dealer to take the Essentials Exam.

If you pass the Essentials Exam, it will be valid for 4 years from your passing date.

Just passing the Essentials Exam will not be enough to qualify you to be a registered person with FINRA. To become a registered person, you will have to have a job with a FINRA member firm, file a U4, get finger-printed, and pass a Top-off exam.

What if you are currently registered?

Current registrants will maintain registration(s) without the need for additional testing.

Most current registrants will be considered to have passed the Essentials Exam, and it will be valid for 4 years upon leaving the securities industry.

Registrants who return to the securities industry within 2 years will regain registration without needing to take the Essentials or Top-off exam.

Registrants who return to the securities industry between 2 and 4 years later will not need to take the Essentials Exam, only the Top-off exam for the registration position.

Registrants who return to the securities industry more than 4 years later will need to take both the Essentials and the top-off exam.

Next steps:

Securities Essentials Exam is being finalized by FINRA and committee of industry representatives.

Top-off exam outlines to be released 9-12 months prior to launch date of exam restructure

Prepare CRD and other FINRA systems for new exam
structure

Create a system for persons not associated with a member to enroll and pay for the Essentials Exam

Make registration rule, fee and qualification exam filings with the SEC in 2016

FINRA says exam restructure will do the following for firms:

• Give firms an opportunity to employ new business models for onboarding staff.
• Allow firms to better gauge industry knowledge of interns and other potential employees.
• Allow non-registered staff (e.g., administrative) to take Essentials Exam.
• Create a larger pool of potential new registered persons

Impact on firms

Firms will have choices of how to onboard new reps:
• Request applicants take and pass Essentials Exam prior to making job application
• Have new hires take Essentials Exam-only initially and then take top-off qualification exam
• Have new hires take both Essentials Exam and top-off exam together

Other info related to exam restructure:

• Through CRD, firms will be able to confirm whether and when an individual passed the Essentials Exam.
• Top-off exams will retain traditional names: i.e., Series 7 exam will remain the Series 7 exam.
• Position designations in CRD will remain the same (i.e., GS will remain GS [Series 7]).
• Firms will be able to schedule the Essentials Exam for support personnel through CRD.
• Current registrants will not need to take the Essentials Exam to maintain current registrations.
• Principal exams and registrations will not be directly affected.

Principal Exams

Under the new representative-level program structure, several principal exams cover subject matter already covered on the Essentials and the Top-off exams.

Example – Series 24 Exam major topic areas include:

• Sales practice (Series 7)
• Investment banking (Series 79)
• Trading (Series 57)
• Research (Series 86/87)

As a result of this, FINRA will develop a principal exam structure that builds on the new representative-level exam structure to reduce redundancy in content and better focus on testing knowledge of and ability to apply supervisory level rules and concepts

Study Question of the Month – April 2016

This month’s study question from the Solomon Online Exam Simulator question database is now available! Relevant to the Series 6, 7, 24, 26, 62, and 82. –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.***

Study Question

Question (Relevant to the Series 6, Series 7, Series 24, Series 26, Series 62, and Series 82): Which of the following would most likely be classified as a branch office?

Answers: 

A. The floor of a registered exchange

B. A vacation home where the registered representative works for 45 business days a year

C. A customer service office where no sales activities are conducted

D. A location used primarily for non-securities activities and from which 25 securities transactions are effected a year

Correct Answer: B. A vacation home where the registered representative works for 45 business days a year

Rationale: A branch office is any location where one or more associated employees is in the business of soliciting or effecting (but not executing) the purchase or sale of any security.

A location outside of a primary residence, for example, a vacation home, is considered a non-branch location as long as it is used for securities business fewer than 30 business days per year.

The floor of a registered exchange is also considered a non-branch office if it is where a member firm conducts business with public customers.

Other examples of non-branch offices include:

  • Any location that is used primarily to engage in non-securities activities and from which the associated persons effect no more than 25 securities transactions in any one calendar year (provided that any retail communication identifying such location also sets forth the address and telephone number of the location from which the associated persons conducting business at the non-branch locations are directly supervised)
  • Any office location established solely for customer service and/or back office type functions where no sales activities are conducted

Congratulations to Alexa M. this month’s Study Question of the Month winner!

Study Question of the Month – March 2016

This month’s study question from the Solomon Online Exam Simulator question database is now available! Relevant to the Series 24 and 26. –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.***

Study Question

Question (Relevant to the Series 24 and Series 26):

Member firms that execute investment company transactions for their customers must transmit payments to underwriters, investment companies or their designated agents by the later of: the end of the _______business day after receiving a customer’s order or the end of _________ after receiving a customer’s payment for such shares.

Answers:

A. seventh, 3 business days

B. second, 1 business day

C. third, 1 business day

D. fifth, 3 business days

Correct Answer: C. third, 1 business day

Rationale: Member firms that execute investment company transactions for their customers must transmit payments to underwriters, investment companies or their designated agents by the later of: the end of the third business day after receiving a customer’s order or the end of 1 business day after receiving a customer’s payment for such shares.

Congratulations to Janet K. this month’s Study Question of the Month winner!

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

Study Question of the Month – February 2016

This month’s study question from the Solomon Online Exam Simulator question database is now available! Relevant to the Series 7, 24, and 62. –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.***

Study Question

Question (Relevant to the Series 7Series 24, and Series 62): When a transaction is executed at 3:00pm Eastern Time, what are the TRACE reporting requirements (assuming the transaction is not a list or fixed offering price transaction, a takedown transaction, or an asset-backed securities transaction)?

Answers: 

A. It must be reported within 10 seconds of execution

B. It must be reported within 15 minutes of execution

C. It must be reported within 30 seconds of execution

D. It must be reported by 8:15 on the next business day

Correct Answer: B. It must be reported within 15 minutes of execution

Rationale: Transactions executed between 8:00 am and 6:15 pm must be reported to TRACE within 15 minutes of execution, and do not receive a designation.

Congratulations to Jessi B., this month’s Study Question of the Month winner!

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

Study Question of the Month – January 2016

This month’s study question from the Solomon Online Exam Simulator question database is now available! Relevant to the Series 7, Series 24, Series 55, and Series 62. –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.***

Study Question

Question (Relevant to the Series 7, Series 24, Series 55, and Series 62): A market maker has a listed a quote of 32.20 – 32.80, 12 x 7 for ABCD stock on NASDAQ. The market maker accepts a buy limit order from a customer for 200 shares at 32.60. What quote will the market maker have to display to comply with a SEC rules?

Answers:

A. 32.60 – 32.80, 10 x 7

B. 32.20 – 32.80, 12 x 7

C. 32.60 – 32.80, 2 x 7

D. 32.20 – 32.80, 2 x 7

Correct Answer: C. 32.60 – 32.80, 2 x 7

Rationale: The SEC requires market makers to immediately (within 30 seconds) display customer limit orders that are better than their current best quote for NMS stocks. In this case, the buy limit order is better than the market maker’s current bid (32.60 > 32.20) so the market maker must immediately display the adjusted quote.

Congratulations to David A., this month’s Study Question of the Month winner!