“Very good material and well planned to help you pass the first time (Series 65). The audio tape structure is easy to listen to along with the reading material…” Continue reading
“Very good material and well planned to help you pass the first time (Series 65). The audio tape structure is easy to listen to along with the reading material. Clear and to the point. Nothing dry about your material. Thank you. Highly recommend.” -Carlos Acosta, GoldBox Wealth, San Antonio, TX
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This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 6, Series 7, Series 62, Series 65, Series 79, and Series 82. –ANSWER POSTED– Continue reading
This week’s study question from the Solomon Online Exam Simulator question database is now available.
Question (Relevant to the Series 6, Series 7, Series 62, Series 65, Series 79, and Series 82):
CMOs were primarily created to distribute the amount of ___________________ risk to investors with various risk tolerances. Choose the BEST answer.
Answers:
A. default
B. credit
C. prepayment
D. interest rate
Correct Answer: C. prepayment
Rationale: Unlike a traditional mortgage backed security that has a single coupon rate and maturity date, a collateralized mortgage obligation is a pool of mortgage-backed securities and/or individual mortgages which is structured into several classes of bondholder, each with a different interest rate and term. With a CMO, streams of interest and principal payments are sliced up and distributed to different classes of investors in separate tranches (slices, in French). CMOs were first introduced in 1983 to offer MBS investors a greater variety of maturities and certainty of cash flow. By redistributing prepayment risk away from some tranches and toward others, CMOs allow investors to choose how much of this type of risk they are willing to accept over a given time horizon. Tranches with the lowest exposure to prepayments offer lower yields to investors wanting to reduce their risk exposure. Tranches that accept higher prepayment risks attract investors seeking higher yields.
Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.
This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 6, Series 7, Series 62, Series 65, Series 66, Series 79 and Series 82. –ANSWER POSTED– Continue reading
This week’s study question from the Solomon Online Exam Simulator question database is now available.
Question (Relevant to the Series 6, Series 7, Series 62, Series 65, Series 66, Series 79 and Series 82):
Which of the following statements concerning REITs (real estate investment trusts) and RELPs (real estate limited partnerships) are true?
I. REITs pass through income, but not losses, to shareholders
II. RELPs pass through both income and losses to shareholders
III. REITs are highly illiquid
IV. RELPs are highly liquid
Answers:
A. I and III
B. II and IV
C. I and II
D. I, II, III and IV
Correct Answer: C. I and II
Rationale: Statements I and II are both true, but statements III and IV are reversed. Limited partnership investments are almost always illiquid, while REITs are highly liquid.
Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.
This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 7, Series 24, Series 62, Series 65, Series 66, and Series 99. –ANSWER POSTED– Continue reading
This week’s study question from the Solomon Online Exam Simulator question database is now available.
Question (Relevant to the Series 7, Series 24, Series 62, Series 65, Series 66, and Series 99):
All the following statements regarding Roth IRAs are correct EXCEPT:
Answers:
A. Contributions to a Roth IRA are tax deductible up to specified limits
B. Earnings in a Roth IRA accrue income tax-free
C. Distributions from a Roth IRA may be tax-free
D. Roth IRAs are subject to the same contribution limits as regular IRAs
Correct Answer: A. Contributions to a Roth IRA are tax deductible up to specified limits
Rationale: Roth IRAs are individual retirement accounts that are funded with after-tax contributions. Individuals can contribute to their Roth IRAs up to the IRS maximum contribution limit. Earnings within the Roth IRA accrue tax-free and distributions from the Roth IRA may also be tax-free when certain criteria are met.
Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.
This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 7, Series 65, and Series 66. –ANSWER POSTED– Continue reading
This week’s study question from the Solomon Online Exam Simulator question database is now available.
Question (Relevant to the Series 7, Series 65, and Series 66):
James cannot believe XYZ is continuing to go down. He would like to give it a little more time to recover, but would like to protect himself if it continues to fall. What type of order would James most likely enter?
Answers:
A. Buy stop
B. Sell Stop
C. Market
D. Sell limit
Correct Answer: B. Sell Stop
Rationale: A sell stop order helps an investor avoid further losses if a stock price continues to drop. A stop order triggers a sale or purchase if the stock reaches a certain price. In this case, James would place the order below the current market and if the stock price decreased to his ‘stop price’, the order would become a market order and sell his position. The order would still allow for James to potentially recover if the stock goes up. If a market order was entered, the stock would be immediately sold at the next available ask price. A sell limit order is an order to sell at a specific price. A sell limit is usually used if the seller only wants to sell if a stock goes up to a certain specified price, but it hasn’t hit that price yet.
Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.
This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 6, Series 7, Series 65, and Series 66. –ANSWER POSTED– Continue reading
This week’s study question from the Solomon Online Exam Simulator question database is now available.
Question (Relevant to the Series 6, Series 7, Series 65, and Series 66):
Carlos, age 58, is in the 25 percent marginal income tax bracket. If he takes a $10,000 distribution from his IRA to pay off credit card debt, Carlos will be subject to a total payment of:
Answers:
A. $0
B. $3,250
C. $2,500
D. $3,500
Correct Answer: D. $3,500
Rationale: Carlos will have to pay ordinary income tax of 25% on his distribution, plus a 10% penalty for early withdrawal because he is under age 59 1/2. $10,000 (distribution amount) x 35% (tax + penalty) = $3,500 total payment for both tax-and-penalty. Perhaps Carlos should look at the $1,000 he will be paying in penalty and compare that to the total anticipated interest payments he will be making on his credit card over the next year and a half.
Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.
This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 7, Series 24, Series 52, Series 62, Series 65, and Series 82. –ANSWER POSTED– Continue reading
This week’s study question from the Solomon Online Exam Simulator question database is now available.
Question (Relevant to the Series 7, Series 24, Series 52, Series 62, Series 65, and Series 82):
How much would you pay for a $1,000 10-year Treasury bond priced at 101.08 (excluding accrued interest)?
Answers:
A. $1,010.80
B. $10,108.00
C. $1,012.50
D. $1,010.25
Correct Answer: C. $1,012.50
Rationale: Treasury bonds are typically priced in percentage points of par and in fractions of 32nds of percentage points. For example the .08 of the quote should be understood as 8/32nds of a percentage point or .25%. Thus, 101.08 is equivalent to 101.25% of par which is $1,000 x 101.25 which is $1,012.50.
Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.
This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 6, Series 7, Series 52, and Series 65. –ANSWER POSTED– Continue reading
This week’s study question from the Solomon Online Exam Simulator question database is now available.
Question (Relevant to the Series 6, Series 7, Series 52, and Series 65):
The Fed (Federal) Funds rate refers to:
Answers:
A. The rate banks have to pay when borrowing from the Federal Reserve
B. The rate broker-dealers pay when borrowing on behalf of customers
C. The rate that the most credit worthy customers pay when borrowing
D. The rate banks charge each other for overnight loans over $1,000,000
Correct Answer: D. The rate banks charge each other for overnight loans over $1,000,000
Rationale: The Federal Funds Rate refers to the rate that banks charge each other for short-term loans.
Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.
“I thought the study material from Solomon Exam Prep was great. It helped me focus on the sections where I needed to study the most…” Continue reading
“I thought the study material from Solomon Exam Prep was great. It helped me focus on the sections where I needed to study the most. I passed with an 81% on my first try for the Series 65 exam. I would definitely use Solomon Exam Prep again if I need to get any more licenses.” -Michael, Portland, OR
Read more reviews here: Solomon Exam Prep Reviews
This week’s study question from the Solomon Online Exam Simulator question database is now available. Relevant to the Series 6, Series 7, Series 24, Series 26, and Series 65. –ANSWER POSTED– Continue reading
This week’s study question from the Solomon Online Exam Simulator question database is now available.
Question (Relevant to the Series 6, Series 7, Series 24, Series 26, and Series 65):
According to the Investment Company Act of 1940, for 75% of its assets, a diversified mutual fund will have:
Answers:
A. No more than 5% of its assets in any one company, and will own no more than 5% of any company’s outstanding shares
B. No more than 5% of its assets in any one company, and will own no more than 10% of any company’s outstanding shares
C. No more than 10% of its assets in any one company, and will own no more than 5% of any company’s outstanding shares
D. No more than 10% of its assets in any one company, and will own no more than 10% of any company’s outstanding shares
Correct Answer: B. No more than 5% of its assets in any one company, and will own no more than 10% of any company’s outstanding shares
Rationale: According to the Investment Company Act of 1940, for 75% of its assets, a diversified mutual fund will have no more than 5% of its assets in any one company, and will own no more than 10% of any company’s outstanding shares.
Weekly study questions are from Solomon’s industry-leading Online Exam Simulator.
