Columbia University

issuer an organization that distributes and sells securities to investors security legal term for investment (stocks, bonds, mutual funds, options, ETFs) equity formal term for ownership two ways to make money on common stock 1. capital appreciation/gains 2. cash dividends retained earnings profits retained by a company that are often used to expand and reinforce business operations, NOT paid by dividend growth companies direct profits back into operatio...

The redemption value of an open-end investment company's shares is based on the: previous offering price previous closing NAV NAV computed after the order is received offering price computed after the order is received NAV computed after the order is received The computation of dollar prices and accrued interest on municipal bonds is normal on what calendar basis? 30/360 30/365 Actual/360 Actual/365 30/360 Blue-sky laws are regulated by which of the following entities? ...

The redemption value of an open-end investment company's shares is based on the: previous offering price previous closing NAV NAV computed after the order is received offering price computed after the order is received NAV computed after the order is received The computation of dollar prices and accrued interest on municipal bonds is normal on what calendar basis? 30/360 30/365 Actual/360 Actual/365 30/360 Blue-sky laws are regulated by which of the following entities? ...

The securities industry's primary regulatory body and created under what act? SEC, Securities Exchange Act of 1934 Function under the SEC's oversight and is accountable to the Commission for enforcing federal securities laws, as well as supervising securities practices within an assigned jurisdiction. Self Regulatory organizations (SRO) what are the largest SROs Financial Industry Regulation Authority (FINRA), Chicago Board Options Exchange (CBOE), Municipal Securities Rulemak...

Section 1: Knowledge of Capital Markets The SEC purpose/mission when created jurisdiction authority protect investos, maintin fair orderly & efficient markets, facilitate capital formation by congress in 1934 US federal government enforce federal security laws & create laws that regulate securities industry enforces Securities act 1933/1934, trust indenture act 1939, investment company act 1940, investment advisors act 1940 SROs (Self-Regulatory Organizations) wha...

What is cost basis? A The original purchase price plus any transaction costs B The transaction charges affiliated with the purchase of any security C The net after-tax purchase price per share of common stock D The amount of any gain or loss if a different transaction had occurred A. The original purchase price plus any transaction costs Which of the following corporate securities carries the greatest risk to the investor? A Commercial paper B Common stock C Preferred s...

Do common stock holders have to right to inspect all books of a company? No, only certain items suchs as the income statement and balance sheet Order of asset distribution Taxes Secured debt Unsecured debt Preferred stock holders Common stock holders What type of corporate security is considered the riskiest? Common stock Of all securities, common stock has historically Provided the best hedge against inflation, best capital appreciation potential Classificati...

A customer writes an MMM January 70 put at 6. The maximum potential gain on this position is 600 Your customer is long 1 October 75 put at 2. The customer's maximum gain potential is 7300 Large time deposits of more than $100,000 are considered to be found in what part of the money supply? M3 By purchasing shares of stock in a company, investors can benefit from which of the following? An increase in the price of the shares An increase in price of the company's debt s...

What type of risk is unique to a specific industry, business enterprise, or investment type? Nonsystematic risk Under which of the following circumstances is an investor in a position to acquire stock? Buy a call, sell a call (The holder of a call has the right to buy stock at the strike price if exercised. The seller of a put is obligated to buy stock at the strike price if exercised) Options- a premium the cost of an option contract, expressed in dollars per share of the under...

purpose of securities industry matching investors with money to issuers that need that money to finance issuer legal entity that sells securities in order to finance its operations (business, governments) ie. us treasury, us gov agencies, foreign governments, state and local governments, corps, banks methods issuers use to raise capital 1) issue debt securities (bonds) and 2) issues equity securities (stocks) debt securities publically traded loans = bonds, notes, or deb...