STUDY FOR THE SECURITIES INDUSTRY ESSENTIALS EXAM (SIE) EXAM

One of the valuable study aids for the Securities Industry Essentials (SIE) exam is the Content Outline published by FINRA. It lists all the topics that the SIE exam covers, meaning that if you plan to take the test, you should be prepared to answer. For example, Section 2.1.1 of the Content Outline lists order of liquidation for a company declaring Chapter 11 bankruptcy, types of voting rights, benefits of convertible securities, and securities that can only be sold under SEC Rule 144. Bob Eder J.D. has a study guide for the test, covering all of the above topics. For example, his book,  Study for the Securities Industry Essentials (SIE) Exam , covers order of liquidation beginning on page 39 of Chapter 3 on Equity Securities. At the end of the section, Bob Eder inserts a question on who gets what first for a company in bankruptcy. Also in its Chapter 3, Study for the Securities Industry Essentials (SIE) Exam also covers types of rights, explaining the difference between st...

Planning to sit for the SIE exam soon? Don't go into the test without familiarizing yourself with fee-based accounts. These are securities accounts where the broker charges one yearly fee that includes commissions, investment advice, and pretty much all other miscellaneous fees and expenses. T he brokerage firm charges a percentage fee on the daily assets in the account. Thus the calculation of fees is made daily, but deducted usually on a quarterly basis. For example if the annual percentage fee for an account is two percent, the brokerage firm will calculate a daily fee using 1/365 times two percent, or .02, times the assets in the account as of the close of trading on any given day. This fee is also charged for Saturdays and Sundays, and also for other non-business days, such as holidays. The SEC includes fee-based accounts as one of its targets for its broker inspection and visitation. It has found many cases where brokers have enrolled customers in fee-based accounts, also...

Do you want to get a good grade on the SIE Exam? Make sure you know the little stuff, for example, know the characteristics of hedge funds. Here's what Bob Eder says in his text, Study for the Securities Industry Essentials Exam , about hedge funds: "A key characteristic of hedge funds is that they are almost always set up as limited partnerships, the investment manager being the fund’s general partner. Monies paid out to the investment manager are almost always considered long-term capital gains, subject to a maximum tax rate of only 20 percent for those with high taxable income. When hedge fund managers talk about "carried interest," this is jargon for their share of realized long-term capital gains, on which they will pay maximum tax of only 20 percent." We indicate here only a small example  on Hedge Funds. Bob Eder's book  covers hedge funds in Chapter 7 on Alternate Investments.  Bob Eder's book,  Study for the Securities Industry...