STUDY FOR THE SECURITIES INDUSTRY ESSENTIALS EXAM (SIE) EXAM

   If you intend to sit for the Securities Industry Essentials (SIE) Exam, make sure that you are familiar with securities in the Money Market and the Capital Markets. The Money Market means the market for short-term debt securities, such as T Bills, commercial paper, brokered certificates of deposit, and bankers acceptances. In contrast, the Capital Markets designate the markets for long-term debt and equity securities. FINRA publishes a Content Outline for the Securities Industry Essentials (SIE) Exam, and, in Section 2.1 and 2.2, FINRA requires  knowledge of equity securities and debt instruments, such as Treasury securities, other money market instruments, and U.S. government agency securities. Bob Eder in his  Study for the  Securities Industry Essentials (SIE) Exam  devotes Chapter 4 to  Debt Securities in both the Money Market and the Capital Markets, including Treasury Securities, U.S. Agency Securities, Money Market Instruments, Corporate Debt...

For applicants taking the SIE exam, FINRA's Content Outline for the Securities Industry Essentials (SIE) exam lists knowledge required of equity securities in section 2.1.1. This includes ownership of these securities, order of liquidation, and limited liability of shareholders. It also specifically includes voting rights, the nature of convertible equity securities, and lastly, Rule 144, dealing with with control and restricted securities. Bob Eder J.D. treats each one of these topics in Chapter 3 of Study for the Securities Industry Essentials (SIE) Exam. Here is Bob Eder's treatment of limited liability of common shares: Limited Liability of Common Shares One of the interesting aspects of ownership of common shares is that a shareholder incurs only limited liability for the debts of the issuing corporation. This is not meant to imply that the value of common stock cannot decrease to zero, which it often does for stock of inferior corporations. But no matter how much debt is ...

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...