Securities Industry Essentials Exam (SIE)
Last Update Jul 14, 2026
Total Questions : 410
We are offering FREE SIE FINRA exam questions. All you do is to just go and sign up. Give your details, prepare SIE free exam questions and then go for complete pool of Securities Industry Essentials Exam (SIE) test questions that will help you more.
Rising economic activity is most likely to increase revenues of which of the following sectors?
Assuming yields are held constant, which of the following statements describes what will occur as a discount bond reaches maturity?
XYZ common stock is trading at $20 per share. An investor sells a call option with a $25 strike price for $3. What is the price of XYZ at which the investor will break even with the transaction?
On which of the following dates will the buyer of a Treasury bond purchased in the secondary market begin earning interest?
A municipal finance professional (MFP) is asked to contribute to the re-election campaign of an issuer official for whom the MFP is not entitled to vote. In making this contribution, the ability of the MFP ' s public finance department to conduct municipal securities business with the issuer is affected:
When making a mutual fund recommendation to a customer, a registered representative must consider all of the following factors except:
Which of the following statements describes a characteristic of Treasury securities?
A customer owns 100 shares of ABC with a current market value of $5.00 per share. The company undergoes a 1-for-2 reverse split of the stock. Which of the following statements is true of the customer ' s holdings and the price of the stock?
A customer purchased 100 shares of Company XYZ common stock five years ago for $20.00 per share. Over the life of her investment, the customer received cash dividends of $2.00 per share, on which she paid total income taxes of $0.50 per share. She recently sold the stock for $30.00 per share. What is the customer ' s cost basis in each share of XYZ stock?
A 529 savings plan investment is most appropriate for which of the following individuals?
Callable preferred stock is most likely to be called when interest rates are:
Which of the following events will cause FINRA to deny an individual’s application for registration?
A customer owns 200 shares of Corporation ABC, which recently announced a 1-for-2 reverse stock split. If the closing price of ABC is $14 on the day before the split, what will this customer’s ABC holdings be immediately after the split?
A broker-dealer (BD) is underwriting an initial public offering (IPO). According to industry rules, which of the following customers is eligible to participate in the IPO?
Executing trades using the delivery versus payment (DVP) settlement process requires the buyer to make a cash payment by which of the following deadlines?
Federal Reserve Regulation T states that an investor is permitted to borrow no more than which of the following percentages of the purchase price of an equity security?
Which of the following types of accounts permits an investor to borrow money from a broker-dealer to help pay for a trade?
Which of the following securities receives the highest priority in case of a bankruptcy?
A customer purchased 100 shares of Company XYZ stock for $10 per share. The stock paid an annual cash dividend of $1 per share. The customer sells his 100 shares three years later for $15 per share. Which of the following amounts is the total pretax return on his investment?
As the economy worsens, which of the following types of investing should perform best?
Which of the following securities entitles the holder to exercise control of the company?
A weakening of the U.S. dollar versus foreign currencies will generally result in which of the following situations?
Which of the following responses best describes the primary strategy that an investor uses when selling a covered call?
For a joint tenants-in-common account with a husband and wife, which of the following statements is true of the broker-dealer’s distribution of the account’s assets upon the death of the husband?
What is the minimum maintenance requirement for a long margin account containing only common stock?
Under FINRA rules, which of the following events does not require a registered representative to update her Form U4 disclosure?
SEC regulations permit a company to issue securities exempted from registration requirements of the Securities Act of 1933 under which of the following conditions?
A city has appointed Broker-dealer XYZ to act as lead underwriter for its upcoming issuance of municipal bonds. This is an example of which of the following types of offering?
A customer and his two brothers want to Invest $30,000 to start an equity portfolio. Two of the brothers will Invest $7,500 each, and the other brother will invest S15,000 to start the account. In the event of death, each of them agrees that the assets should be passed on to their heirs proportionately. Which of the following types of accounts should the registered representative recommend to the customers?
A retail investor owns shares of Mutual Fund ABC that paid a $0.25 dividend on September 1 and closed at $10.00. What is the opening price once this fund trades on the ex-dividend date?
A customer fails to make a timely payment for a substantial purchase in a cash account. Federal Reserve Regulation T requires that, in the absence of an extension, the firm must take which of following actions?
Which of the following statements describes a violation of industry standards of conduct?
A registered representative (RR) notices that their long-time elderly customer’s portfolio has some unusual activity that is not within the customer’s typical investing pattern. The RR wants to ensure that the customer is not being exploited. Which of the following initial steps is the RR permitted to take to resolve their suspicions?
Which of the following statements is true of the comparison between penny stocks and blue-chip stocks?
How frequently must a firm send statements for a brokerage account with no activity?
Which of the following statements is true regarding the SEC ' s characterization of a registration statement that has just been made effective?
Which of the following is a reportable obligation with respect to an individual ' s Form U4?
Which of the following account registration types is subject to probate upon the death of the account owner?
Which of the following statements best describes a characteristic of 529 savings plan accounts?
Under the federal tax code, distributions from a 529 savings plan for tuition or room and board are:
An open-end mutual fund is best described as a type of investment company that pools money from multiple investors to purchase a portfolio of:
A broker-dealer (BD) signs a selling agreement with the ABC family of mutual funds. To introduce the funds to the BD’s sales force, ABC offers a training and education trip at a popular beach resort. The trip expenses will be covered by ABC for the three registered representatives in the BD who have the highest level of production in ABC funds during the month. The BD’s branch office managers assess each sale of ABC funds to ensure that the BD’s recommendations are aligned with the customers’ investment objectives and risk tolerance. Which of the following statements best describes the permissibility of this arrangement?
Which of the following security types may contain convertible features allowing the holders to exchange the securities for other issues of the company?
An investor buys 100 shares of a stock at $50.00 per share. The company declares a 10% stock dividend. What will the investor ' s cost basis per share be following the payment of the dividend?
If a bond is selling at a premium, which of the following statements is true?
Under SEC Regulation A, which of the following market participants, if deemed to be a bad actor, will disqualify the offering from reliance on this registration exemption?
Company XYZ files a registration statement for its initial public offering (IPO). XYZ is permitted to communicate all of the following information about the offering in writing to investors except that:
Which of the following entities settles broker-to-broker equity, listed corporate and municipal bond, and unit investment trust (UIT) transactions in the U.S. equities markets?
If a brokerage account is approved for options trading, when must the options disclosure document be delivered to the customer?
A customer will be out of the country for the next two months on business and asks his firm to hold his mail until he returns. Which of the following statements is true regarding this request?
Which of the following products is the most appropriate class of investments for a customer looking for income and capital gains?
Which of the following responses describes a common feature of a hedge fund?
A customer purchases 100 shares of stock. The customer fears a decline in the share price and would like to protect his investment and minimize loss. Which of the following strategies should the customer employ to lock in his profit?
Which of the following activities engaged in by a registered person is considered a private securities transaction?
A company files a registration statement with the SEC to register a new Issue of securities. The company does not plan to sell all the registered shares at this time and instead plans to gradually sell new shares over a three-year period. This registration is called a:
Which of the following investments is least likely to provide an investor with funds within one business day of liquidation?
A mother wants to set up an account for her son so she can make yearly gifts but not allow her son to withdraw funds to pay for his living expenses. Which of the following account types best meets this objective?
Which of the following assets is not covered under the SEC ' s Customer Protection Rule?
A customer instructs his registered representative (RR) to purchase $35,000 Class A shares of Growth Fund ABC. As the RR enters the order, she overhears her customer speaking to his wife about purchasing $100,000 of Emerging Markets Fund ABC once he gets his year-end bonus. Which of the following statements is true about receiving a breakpoint discount for the current purchase?
The process in which the buying firm must pay for the securities and the selling firm must deliver the securities is known as:
A registered representative (RR) receives a mutual fund order from a customer at 4:10 p.m. ET. Which of the following statements is true regarding this order?
The prohibited practice of excessively trading in a discretionary account in order to generate commissions is known as:
The Federal Reserve is expected to announce several sizeable interest rate increases over the next year. It is most likely attempting to address:
The rate that equates a bond’s annual interest payment to its market price is a bond’s:
Which of the following individual brokerage account holdings would receive full SIPC coverage?
Which of the following statements is true of the writer of a listed equity call option?
A confirmation indicates a 100-share purchase of Company ABC at $11. According to SEC rules, which of the following information is required to be stated on the confirmation?
A customer receives a confirmation that discloses the firm has acted in a principal capacity. Which of the following statements is the best explanation for this disclosure?
Which of the following responses best describes how member firms are required to retain electronic correspondence and internal communications of associated persons?
Which of the following investors is permitted to purchase shares in an equity initial public offering (IPO)?
A registered representative (RR) at Broker-dealer ABC receives a large sell order from a customer. The RR places an order in his own account to sell shares of the same security prior to placing the customer ' s order. Which of the following best describes this type of activity?
A partnership has had poor results, and a limited partner is concerned about the extent of her potential losses. Which of the following statements regarding her exposure is true?
If an investor is bullish on ABC, which of the following actions will he most likely take?
Corporation ABC has excess cash and would like to signal to the public that management believes its stock is undervalued and that it has a positive outlook for the company. Which of the following corporate actions would be the most appropriate for ABC to take?
Which of the following statements is true regarding a member firm’s business continuity plan?
Which of the following statements is typically true of investors in open-end mutual funds?
A customer deposits an $8,000 cashier ' s check in their account. Later the same day, they deposit a $2,500 money order. Which of the following actions, if any, must the firm take in response to this activity?
Which of the following securities issued by a corporation allows the owner to vote on matters of the corporation?
Which of the following activities is permitted during the cooling-off period of an initial public offering (IPO)?
Company ABC announces a 1-for-3 reverse stock split. The customer owns 300 shares priced at $9.00 each. After the split, how many shares will the investor have and at what price?
Which of the following funds provides the highest liquidity for investors?
An investor holds 1,000 shares of a stock with a total cost basis of $5,000 in his account when a 1-for-5 reverse stock split is announced. What will be the investor ' s total cost basis after the payable date of the reverse split?
A customer wants to open an account to trade covered calls and puts. Which of the following communications must be provided to the customer prior to approving the account for trading?
Which of the following rates is the interest rate at which banks borrow and lend to each other on an overnight basis?
Which of the following self-regulatory organizations (SROs) is responsible for regulating the municipal securities market?
A customer retires at age 65 and rolls over his 401(k) of $850,000 In equities into an Individual retirement account (IRA). This Is his entire portfolio, and he is concerned about the stock market collapsing and ruining his portfolio. The customer is most concerned with which type of risk?
Which of the following responses describes a collateralized mortgage obligation (CMO) tranche?
A currency devaluation impacts a country ' s economic activity in which of the following ways?
Under which of the following circumstances is a member firm required to report a customer interaction as a complaint?
In performing fundamental analysis of an equity, which of the following elements should an investor consider?
Which of the following characteristics is associated with joint tenants with rights of survivorship (JTWROS) accounts?
A customer has agreed to purchase a risky investment. The registered representative’s (RR’s) firm requires the customer’s signature on a risk disclosure form; however, the customer is unavailable to sign the form. The RR signs the form on behalf of the customer using a digital signature platform. Which of the following statements best describes the permissibility of the RR’s actions?
Which of the following is the primary risk of using asset allocation models without periodic rebalancing?
A 50-year-old customer wants to establish an individual retirement account (IRA) that will allow tax-free withdrawals when they retire in 15 years. Which of the following account types will satisfy their needs?
The Options Clearing Corporation is a registered clearing agency for which of the following products?
A registered representative (RR) intends to enter into an arrangement for compensation with an unaffiliated entity to participate in the sale of promissory notes to the general public. Which of the following statements is true?
The cash value of a variable life insurance policy is affected by which of the following factors?
Which of the following terms describes the use of overnight loans of excess reserves between banks to maintain their reserve requirements?
A mutual fund prospectus discloses the following sales charges to purchase fund shares:
Amount / Rate
$100 to $24,999 → 8%
$25,000 to $49,999 → 7%
$50,000 to $99,999 → 6%
$100,000 and above → 5%
Which of the following purchase amounts may be suspected as a breakpoint sale violation?
A registered representative is positive about the prospects of Company ABC, a publicly traded corporation. He wants to send an email to his customers about the company’s stock. Which of the following statements in that email is prohibited?
Which of the following parties Is permitted to purchase a security in an Initial public offering (IPO)?
On settlement date, a customer is unable to pay for a purchase in his cash account. His position is liquidated. Which of the following statements is true according to Federal Reserve Regulation T?
A customer owns shares in Equity Growth Fund ABC and wants to diversify her holdings by making a new investment in Fixed Income Fund ABC. Which of the following parties has the primary responsibility for ensuring that the additional investment is made at the breakpoint that is appropriate for the customer’s total overall investment in ABC funds?
Which of the following statements is true regarding the impact of a bond’s duration on the volatility of the bond’s price?
Which of the following items is an advantage for an issuer of a shelf offering?
SEC Regulation S-P (Consumer Privacy) requires certain information to be included in privacy notices delivered to customers of broker-dealers (BDs). Which of the following information is required to be included in the privacy notice?
TESTED 14 Jul 2026
