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STC SERIES 66 GREENLIGHT EXAM WITH
CORRECT ACTUAL QUESTIONS AND
CORRECTLY WELL DEFINED ANSWERS
LATEST ALREADY GRADED A+ 2025 –
2026
Securities that are registered through qualification may only be sold: -
(ANSWER)Once the registration is declared effective by the Administrator
Securities that are registered through qualification may be sold once the
registration is declared effective by the Administrator. Note that in choice (c), the
use of the term approved is inappropriate. Securities that are deemed effective
for sale by an Administrator may not be described as having been approved by
the Administrator.
The difference between a corporation's current assets and its current liabilities is
the: - (ANSWER)Working capital
The amount by which a corporation's current assets exceed its current liabilities is
referred to as working capital.
Assuming an expected rate of return, a specific holding period, and a sum to be
invested, an IAR is able to determine an investment's: - (ANSWER)Future value
The future value of an investment is based on the present value of the amount
invested, using a discount rate each year, and doing so over a given period of
time. The assumption is that the annual return is reinvested at the same rate, or is
compounded over the given time period, thereby resulting in a future value that
exceeds the present value.
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Which of the following types of risk is MOST associated with the purchase of a
five-year T-bond? - (ANSWER)Interest-rate
Interest-rate risk, which is also referred to as money-rate risk, is essentially the
risk that if interest rates rise, the prices of the debt securities will fall. If an
investor needs to liquidate her debt investment prior to maturity, rising interest
rates reduce the value she would receive if she sold the security in the secondary
market. Market risk is primarily associated with common stock. Since the
secondary market for Treasuries is very active, liquidity risk is not a factor.
Although legislative risk (changes in the law) could create diminished value for the
instruments, it is not likely to occur.
Disadvantages of investing in a C Corporation include which of the following
choices?
Shareholders are taxed on dividends that they receive.
The corporation is taxed on its income.
Shareholders may not deduct their share of the corporation's losses on their
personal tax returns.
Shareholders are paid last if the corporation liquidates. - (ANSWER)I, II, III, and IV
All of the choices are disadvantages of investing in a C Corporation
All the following are characteristics of passive asset allocation strategies, EXCEPT:
- (ANSWER)Altering a portfolio in anticipation of an economic event
A passive asset allocation strategy (e.g., buy and hold) is characterized by low
transaction costs and minimal tax consequences. Systematic rebalancing, another
passive strategy, alters the portfolio on a monthly, quarterly, or annual basis to
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restore an original strategic asset allocation if market movements have changed
it. On the other hand, active (tactical) asset allocation strategies effect changes to
a portfolio's allocation in anticipation of economic events.
A person has established an IA as a sole proprietorship and works as an IAR out of
his home office. To help promote and manage the IA, he has set up a website
which contains personal information about his clients. A few weeks after setting
up the website, the IAR discovers that the website has been hacked and his
customers' account information has been stolen. What is the primary regulatory
concern? - (ANSWER)The IA did not prepare proper cybersecurity policies,
procedures, and measures before launching the website.
Both the SEC and state Administrators require IAs to establish cybersecurity
policies in order to protect their clients. Since the website was hacked, the
regulator's primary concern is the extent of the IA's cybersecurity measures. The
regulations don't require websites to be password protected, despite the fact that
many IAs may find them necessary to protect client information. Also, there's no
requirement for an IA to be federally covered before creating a website. Although
websites are considered advertisements and regulators must be notified, it's
unlikely that this is the primary regulatory concern.
A Nasdaq listed company is offering 1,000,000 shares of common stock in State A.
The Administrator in State A may:
Not require registration of the stock in State A.
Require the issuer to perform notice filing.
Require the issuer to pay a fee.
Investigate the underwriter for possible fraud in connection with the offering. -
(ANSWER)I and IV only
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Securities that are listed on a national exchange (e.g., Nasdaq, NYSE, or AMEX) are
referred to as federal covered securities and, therefore, are not required to be
registered at the state level. Additionally, if the federal covered security is listed
on an exchange, the state may not require the issuer to pay a fee, submit a notice
filing, or provide a consent to service of process. However, the state
Administrator may investigate any broker-dealer (including the underwriter) that
participates in the offering for fraud or deceit and file an enforcement action if it
is warranted.
According to the Uniform Securities Act, which of the following activities by an
agent of a broker-dealer is unethical? - (ANSWER)Executing orders to sell
securities in a client's individual and joint account based on instructions from the
client's spouse.
Unless the client's spouse has been given specific authorization, executing these
orders is unethical. An agent may exercise discretion over the price and/or time of
execution, based on verbal authorization from the client. Agents are allowed to
accept unsolicited orders to buy and sell securities. Agents are not required to
send all clients a preliminary prospectus, but they are required to send a final
prospectus to clients who purchase non-exempt securities.
If an agent of a broker-dealer is granted a durable power of attorney over a
client's account, all of the following statements are TRUE, EXCEPT - (ANSWER)The
client must be an institution
A durable power of attorney provides the agent with the power to manage the
grantor's financial affairs even if the grantor becomes incapacitated. With this
authority (which must be in written form), the agent of the broker-dealer may
make financial decisions on behalf of the grantor (discretion). A standard power
of attorney is terminated if the grantor becomes incapacitated. (17178)
STC SERIES 66 GREENLIGHT EXAM WITH
CORRECT ACTUAL QUESTIONS AND
CORRECTLY WELL DEFINED ANSWERS
LATEST ALREADY GRADED A+ 2025 –
2026
Securities that are registered through qualification may only be sold: -
(ANSWER)Once the registration is declared effective by the Administrator
Securities that are registered through qualification may be sold once the
registration is declared effective by the Administrator. Note that in choice (c), the
use of the term approved is inappropriate. Securities that are deemed effective
for sale by an Administrator may not be described as having been approved by
the Administrator.
The difference between a corporation's current assets and its current liabilities is
the: - (ANSWER)Working capital
The amount by which a corporation's current assets exceed its current liabilities is
referred to as working capital.
Assuming an expected rate of return, a specific holding period, and a sum to be
invested, an IAR is able to determine an investment's: - (ANSWER)Future value
The future value of an investment is based on the present value of the amount
invested, using a discount rate each year, and doing so over a given period of
time. The assumption is that the annual return is reinvested at the same rate, or is
compounded over the given time period, thereby resulting in a future value that
exceeds the present value.
, 2
Which of the following types of risk is MOST associated with the purchase of a
five-year T-bond? - (ANSWER)Interest-rate
Interest-rate risk, which is also referred to as money-rate risk, is essentially the
risk that if interest rates rise, the prices of the debt securities will fall. If an
investor needs to liquidate her debt investment prior to maturity, rising interest
rates reduce the value she would receive if she sold the security in the secondary
market. Market risk is primarily associated with common stock. Since the
secondary market for Treasuries is very active, liquidity risk is not a factor.
Although legislative risk (changes in the law) could create diminished value for the
instruments, it is not likely to occur.
Disadvantages of investing in a C Corporation include which of the following
choices?
Shareholders are taxed on dividends that they receive.
The corporation is taxed on its income.
Shareholders may not deduct their share of the corporation's losses on their
personal tax returns.
Shareholders are paid last if the corporation liquidates. - (ANSWER)I, II, III, and IV
All of the choices are disadvantages of investing in a C Corporation
All the following are characteristics of passive asset allocation strategies, EXCEPT:
- (ANSWER)Altering a portfolio in anticipation of an economic event
A passive asset allocation strategy (e.g., buy and hold) is characterized by low
transaction costs and minimal tax consequences. Systematic rebalancing, another
passive strategy, alters the portfolio on a monthly, quarterly, or annual basis to
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restore an original strategic asset allocation if market movements have changed
it. On the other hand, active (tactical) asset allocation strategies effect changes to
a portfolio's allocation in anticipation of economic events.
A person has established an IA as a sole proprietorship and works as an IAR out of
his home office. To help promote and manage the IA, he has set up a website
which contains personal information about his clients. A few weeks after setting
up the website, the IAR discovers that the website has been hacked and his
customers' account information has been stolen. What is the primary regulatory
concern? - (ANSWER)The IA did not prepare proper cybersecurity policies,
procedures, and measures before launching the website.
Both the SEC and state Administrators require IAs to establish cybersecurity
policies in order to protect their clients. Since the website was hacked, the
regulator's primary concern is the extent of the IA's cybersecurity measures. The
regulations don't require websites to be password protected, despite the fact that
many IAs may find them necessary to protect client information. Also, there's no
requirement for an IA to be federally covered before creating a website. Although
websites are considered advertisements and regulators must be notified, it's
unlikely that this is the primary regulatory concern.
A Nasdaq listed company is offering 1,000,000 shares of common stock in State A.
The Administrator in State A may:
Not require registration of the stock in State A.
Require the issuer to perform notice filing.
Require the issuer to pay a fee.
Investigate the underwriter for possible fraud in connection with the offering. -
(ANSWER)I and IV only
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Securities that are listed on a national exchange (e.g., Nasdaq, NYSE, or AMEX) are
referred to as federal covered securities and, therefore, are not required to be
registered at the state level. Additionally, if the federal covered security is listed
on an exchange, the state may not require the issuer to pay a fee, submit a notice
filing, or provide a consent to service of process. However, the state
Administrator may investigate any broker-dealer (including the underwriter) that
participates in the offering for fraud or deceit and file an enforcement action if it
is warranted.
According to the Uniform Securities Act, which of the following activities by an
agent of a broker-dealer is unethical? - (ANSWER)Executing orders to sell
securities in a client's individual and joint account based on instructions from the
client's spouse.
Unless the client's spouse has been given specific authorization, executing these
orders is unethical. An agent may exercise discretion over the price and/or time of
execution, based on verbal authorization from the client. Agents are allowed to
accept unsolicited orders to buy and sell securities. Agents are not required to
send all clients a preliminary prospectus, but they are required to send a final
prospectus to clients who purchase non-exempt securities.
If an agent of a broker-dealer is granted a durable power of attorney over a
client's account, all of the following statements are TRUE, EXCEPT - (ANSWER)The
client must be an institution
A durable power of attorney provides the agent with the power to manage the
grantor's financial affairs even if the grantor becomes incapacitated. With this
authority (which must be in written form), the agent of the broker-dealer may
make financial decisions on behalf of the grantor (discretion). A standard power
of attorney is terminated if the grantor becomes incapacitated. (17178)
