SIE CANDIDATES - KNOW THE DIFFERENCES BETWEEN PRIME BROKERS, INTRODUCING BROKERS, AND CLEARING BROKERS

Don't go in and sit for the Securities Industry Essentials exam (SIE) without first mastering the definitions of, and the differences between, prime brokers, introducing brokers, and clearing brokers.

Why? Because FINRA lists these topics as important in section 1.1.4 of its Content Outline for the SIE exam.

Bob Eder covers these subjects on pages 15 and 16 of his book, Study for the SIE Exam. Here is a sample of his discussion:

Introducing Brokers (1.1.4)

These broker/dealers do not wish to maintain a back office handling paperwork, trade confirmations, handling of certificates and trade processing. They avoid this work by using a clearing broker to handle these functions. In effect, one can think of introducing brokers as branch offices and the clearing broker as the main office. The introducing broker will open an account for a client, then transmit all the information about the client, such as address, business, investment objective to the clearing brokerage firm.

Here is the link to FINRA's Content Outline for the SIE exam. See the references to prime brokers, introducing brokers, and clearing brokers under section 1.1.4 of FINRA's Content Outline.

Study for the Securities Industry Essentials (SIE) Exam is available from Amazon in both paperback and Kindle e-book versions. 

Here is the link to Bob Eder's book on Amazon.

Bob Eder received his Juris Doctor (J.D.) degree from the University of Utah, Quinney College of Law in 2001.

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