Weekend Before SIE Notes
Term Bond: A bond issue where every bond has the same interest rate and
maturity. Corporate bond issues and US Government bond issues are typically an
example of this bond.
Serial Bond: A bond issue with different maturities and different interest rates per
maturity. Most municipal bond issues and corporate equipment trust certificates
are serial bonds.
Series Bond: A bond issue where the bonds have the same maturity but different
dates of issuance. Long-term construction projects where all the money is not
needed at once. Total interest cost to the issuer is reduced.
●
The typical call protection period for new issues of bonds is 10 years.
T-Bill Weekly Auction | All Other Treasury Debt Monthly Auction
●
●
●
●
Foreign currencies trade in the interbank market.
Trading of foreign currency option contracts takes place on the
Philadelphia Stock Exchange.
Trading of listed equity options takes place on the CBOE, AMEX, PHLX,
PAC and ISE.
Trading of banker acceptances takes place in the OTC market.
Order Ticket must include size of transaction, execution price if the order is not a
market order, and the customer account name/number.
Intrastate Offering Rule 147: Resale of the securities is permitted within that
state immediately following the offering but resale outside that state is prohibited
for the 6 month period following the initial offering.
●
●
●
●
Any gift in the UGMA is irrevocable, once given to the minor it cannot be
taken back.
A corporate security with at least 5 years to maturity is a non-callable
funded debt. The term funded refers to corporate debt that is considered
a part of company’s permanent long term financing. Included is all
corporate debt with 5 years or more to maturity.
Rule 144 allows the sale, every 90 days, of the greater of 1% of the
outstanding shares of that company; or the weekly average of the prior 4
week’s trading volume.
Bid and NAV are the same terms for investment company shares. Ask is
the same thing as POP.
●
●
●
●
●
Money supply is a leading economic indicator. Personal Income Levels |
GDP | Employment levels are all coincident or current indicators.
If a child gets a scholarship for 529 Plan, then funds can be withdrawn
from the account up to the amount of the scholarship and used for
another purpose. They are only subject to ordinary income tax on the
build-up and there is no 10% penalty tax.
Industrial Development Bond are guaranteed by the corporate lessee.
A copy of the member firm’s Business Continuity Plan must be provided
to each customer at account opening.
Ad valorem taxes do not back special tax bonds. Ad valorem taxes back
GO bonds. The definition of a special tax bond is one which is not backed
by ad valorem taxes, but rather by another tax source (such as excise,
sales and income taxes).
A broker-dealer must check each new customer’s name against the Specially
Designated Nationals List to comply with anti-money laundering regulations.
●
Money market instruments are one of the best investments during
inflationary times as they have no purchasing power risk.
●
Regulation T defines 3 types of accounts: Margin Account, Cash
Account, and Arbitrage Account (short against the box). Discretionary
account is defined by the regulations of the SROs such as FINRA.
●
The most common maturity for commercial paper is 30 days.
●
The difference between the 30 year Bond (higher) and 30 year Tips
(lower) is the expectation of the inflation rate.
●
Intangible drilling costs are 100% deductible as drilled, and represent the
costs of drilling holes in the ground to find oil and gas reserves. These
costs include drilling equipment rental fees, labor, fuel, materials etc.
Once the holes are drilled, there is no residual value to these costs,
hence they are termed “intangible”.
●
Maximum Sales Charge of NAV is 8.5% for non 12b-1 funds. For 12b-1
funds it is 7.25%. Maximum 12b-1 fee is not allowed to exceed 0.75% in
this case. No-load funds, can only charge a 12b-1 fee up to 0.25%.
●
Jumbo Certificates of Deposit in amounts above $250,000 are
guaranteed by the issuing bank since any amount over $250k is not
guaranteed by FDIC.
●
Series EE bonds are redeemed at par plus interest earned.
●
The ex-date for a mutual fund is set by the Board of Directors.
●
LGIPs are local government investment pools that allow municipal entities
to invest their money in a variety of securities.
●
Arranging yields from highest to lowest, its Corporate Bond Fund > US
Government Fund > Municipal Bond Fund. The yield on munis is much
lower because they are often entirely tax free, which is reflected in the
yield.