Skip to content

FINRA Practice Tests
Practice Exams
- SIE
- Series 3
- Series 4
- Series 6
- Series 7
- Series 9
- Series 10
- Series 24
- Series 26
- Series 27
- Series 57
- Series 63
- Series 65
- Series 66
- Series 79
- Series 99

SIE – Practice Exam 14

Time limit: 0

Quiz Summary

0 of 10 Questions completed

Questions:

Information

You have already completed the quiz before. Hence you can not start it again.

Quiz is loading…

You must sign in or sign up to start the quiz.

You must first complete the following:

Results

Exam complete. Results are being recorded.

Results

0 of 10 Questions answered correctly

Your time:

Time has elapsed

You have reached 0 of 0 point(s), (0)

Earned Point(s): 0 of 0, (0)
0 Essay(s) Pending (Possible Point(s): 0)

Categories

Not categorized 0%

Next Exam Main Menu

Question 1 of 10

1. Question

A broker recommends the stock of ABC Company to several customers, which creates excessive demand for the stock and raises its market price. The broker then sells his own shares of ABC Company and makes a large profit. This is a prohibited market manipulation tactic known as:

Front running
Correct Incorrect Correct answer

Market rumors
Correct Incorrect Correct answer

Freeriding
Correct Incorrect Correct answer

‘Pump and dump’ scheme
Correct Incorrect Correct answer

Correct

Incorrect
Question 2 of 10

2. Question

Which of the following scenarios illustrates the prohibited market manipulation practice known as front running?

A broker enlists several colleagues to place multiple trade orders for XYZ Company’s stock prior to market open, which leads to an increase in the demand for the shares and an increase in price. Once the price increases, they sell their shares for a profit.
Correct Incorrect Correct answer

A broker receives an order from her customer to purchase 250,000 shares of XYZ Company. Before executing the order, she purchases shares in her personal account, and then, after executing the order, sells her own shares for a large profit.
Correct Incorrect Correct answer

A broker recommends XYZ Company stock to several customers, which leads to an increase in the demand for the shares and an increase in price. The broker then sells her own shares of XYZ Company and makes a large profit.
Correct Incorrect Correct answer

A broker personally owns 500 shares of XYZ Company. She plants a rumor about the company to drive up its stock price, and then subsequently sells off her shares for a profit.
Correct Incorrect Correct answer

Correct

Incorrect
Question 3 of 10

3. Question

Brokers who trade excessively in their customers’ accounts to inflate their commissions are engaging in the prohibited activity known as:

Marking the open
Correct Incorrect Correct answer

Backing away
Correct Incorrect Correct answer

Churning
Correct Incorrect Correct answer

Marking the close
Correct Incorrect Correct answer

Correct

Incorrect
Question 4 of 10

4. Question
Individuals who violate FINRA and SEC insider trading rules face the following civil and criminal penalties:
1. Fines up to $25 million
2. Up to 10 years imprisonment
3. Up to 20 years imprisonment
4. Fines up to $5 million
I and II
Correct Incorrect Correct answer

I and III
Correct Incorrect Correct answer

II and IV
Correct Incorrect Correct answer

III and IV
Correct Incorrect Correct answer
Correct

Incorrect
Question 5 of 10

5. Question

XYZ Company is in the process of acquiring a competitor company, and, prior to the public announcement, their CFO discloses the impending acquisition to a friend of hers. If the friend trades their shares of XYZ Company based on this information, who has committed securities fraud?

Both the CFO and the CFO’s friend
Correct Incorrect Correct answer

Only the CFO
Correct Incorrect Correct answer

Only the CFO’s friend
Correct Incorrect Correct answer

No one has committed securities fraud in this scenario
Correct Incorrect Correct answer

Correct

Incorrect
Question 6 of 10

6. Question

Which of the following scenarios best illustrates the illegal practice of insider trading?

An investor purchases shares of a company after reading the company’s public annual report
Correct Incorrect Correct answer

An investor sells shares of a company based on the company’s public financial statements
Correct Incorrect Correct answer

An employee sells shares of their company based on nonpublic knowledge of an impending lawsuit
Correct Incorrect Correct answer

A CEO buys shares of their company after publicly disclosing a merger in an interview
Correct Incorrect Correct answer

Correct

Incorrect
Question 7 of 10

7. Question

Registered representatives are prohibited from performing which of the following activities?

Purchasing a new issue of an equity security
Correct Incorrect Correct answer

Making a recommendation that does not fit the customer’s investment goals
Correct Incorrect Correct answer

Selling a new issue of an equity security to other broker-dealers
Correct Incorrect Correct answer

All of the above
Correct Incorrect Correct answer

Correct

Incorrect
Question 8 of 10

8. Question

Unregistered persons are prohibited from performing all the following activities EXCEPT:

Discussing firm investment products or services
Correct Incorrect Correct answer

Extending invitations to firm events that discuss securities
Correct Incorrect Correct answer

Pre-qualifying firm customers
Correct Incorrect Correct answer

Soliciting new customer accounts or orders
Correct Incorrect Correct answer

Correct

Incorrect
Question 9 of 10

9. Question

Customer account records must be kept for a period of:

Three years
Correct Incorrect Correct answer

Five years
Correct Incorrect Correct answer

Six years
Correct Incorrect Correct answer

Nine years
Correct Incorrect Correct answer

Correct

Incorrect
Question 10 of 10

10. Question

Commingling is a prohibited activity. Instead, firms are required to:

Deposit clients’ funds into the firm’s account
Correct Incorrect Correct answer

Use firm funds to purchase securities for the client
Correct Incorrect Correct answer

Combine multiple clients’ funds in a single account
Correct Incorrect Correct answer

Segregate clients’ cash and securities from those of the firm
Correct Incorrect Correct answer

Correct

Incorrect

1
2
3
4
5
6
7
8
9
10

FINRA Practice Tests

FINRA®, SIE®, and Securities Industry Essentials® are trademarks of the Financial Industry Regulatory Authority (FINRA). This website is not affiliated with, endorsed by, or approved by FINRA. All trademarks are the property of their respective owners.

Practice Tests

SIE
Series 10
Series 63
Series 3
Series 24
Series 65
Series 4
Series 26
Series 66
Series 6
Series 27
Series 79
Series 7
Series 57
Series 99
Series 9

Quick Links

Home
About
Contact
Privacy Policy

Quiz Summary

Information

Results

Results

Categories

1. Question

A broker recommends the stock of ABC Company to several customers, which creates excessive demand for the stock and raises its market price. The broker then sells his own shares of ABC Company and makes a large profit. This is a prohibited market manipulation tactic known as:

2. Question

Which of the following scenarios illustrates the prohibited market manipulation practice known as front running?

3. Question

Brokers who trade excessively in their customers’ accounts to inflate their commissions are engaging in the prohibited activity known as:

4. Question

Individuals who violate FINRA and SEC insider trading rules face the following civil and criminal penalties:

5. Question

XYZ Company is in the process of acquiring a competitor company, and, prior to the public announcement, their CFO discloses the impending acquisition to a friend of hers. If the friend trades their shares of XYZ Company based on this information, who has committed securities fraud?

6. Question

Which of the following scenarios best illustrates the illegal practice of insider trading?

7. Question

Registered representatives are prohibited from performing which of the following activities?

8. Question

Unregistered persons are prohibited from performing all the following activities EXCEPT:

9. Question

Customer account records must be kept for a period of:

10. Question

Commingling is a prohibited activity. Instead, firms are required to: