SIE CANDIDATES SHOULD STUDY AND KNOW STRATEGIES FOR THE MITIGATION OF RISK

Don't go to sit for the Securities Industry Essentials exam without being familiar with strategies designed to reduce or mitigate investment risks. These strategies include hedging, diversifying, and rebalancing one's portfolio. FINRA specifically includes these mitigation strategies in its SIE Content Outline under Section 2.2. This indicates that the SIE contains questions asking about these strategies.

Bob Eder discusses these mitigation strategies in his book Study for the Securities Industry Essentials (SIE) Exam on page 151. Here is a sample of Bob Eder's treatment:

"Hedging (2.2)"

"How to protect a stock portfolio against unexpected declines? Options are the way many traders protect their stock positions, either long or short. For greatest protection of long stock positions, purchase puts either on stocks or on stock indices. For greatest protection of short stock position, consider purchase of calls."

Here is the link to FINRA's Content Outline for the SIE exam. See the references to Risk Mitigation Strategies in FINRA's Content Outline, section 2.2.

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.

For questions about Bob Eder's SIE manual, Study for the Securities Industry Essentials (SIE) Exam, or questions in general about the SIE exam, or about Risk Mitigation Strategies, feel free to email Bob Eder at bobeder@bobeder.net.

Bob Eder received his Juris Doctor (J.D.) degree from the University of Utah, Quinney College of Law, in 2001. See Bob Eder's Author Page on Amazon.com.



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