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Series 57 Practice Exam
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Series 57 Practice Exam 3

Series 57 Practice Exams

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Practice Exam 2
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Series 57 Practice Exam 3

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Question 1 of 10

1. Question

When trading in a stock is halted due to a pending new release, a variety of modifiers are used to announce the halt, the release of the news, and when trading will begin. Which of the following statements are true?

A .T1 is used to announce the halt
Correct Incorrect Correct answer

A .T2 is used to announce the news release
Correct Incorrect Correct answer

A T.3 is used to notify market-makers they may re-enter quotes into the system
Correct Incorrect Correct answer

A T.4 is used to notify the market trading has resumed.
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Correct

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Question 2 of 10

2. Question

Stock trades done on the weekends and exchange-observed holidays shall be reportable to the Tape:

Within 10 seconds
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By 9:30 am ET on the business day following the trade
Correct Incorrect Correct answer

By 8:15 am ET on the business day following the trade
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Trades done on non-business days are not reported.
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Question 3 of 10

3. Question

When a market-making member firm submits a request to enter quotes into the NASDAQ system for an additional stock, assuming the firm meets all capital and other requirements, the firm will receive approval:

On the day of the request
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Within 1 business day of the request
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Within 5 business days of the request
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When NASDAQ indicates
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Correct

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Question 4 of 10

4. Question

The LULD, limit up limit down rules will go into effect in which of the following situations?

The national best bid is equal to or lower than the lower limit band
Correct Incorrect Correct answer

The national best offer is equal to or above the upper limit band
Correct Incorrect Correct answer

The national best bid is equal to or higher than the upper limit band
Correct Incorrect Correct answer

A trading halt after pending news has been released is ended and followed by significant price adjustments to the inside quote.
Correct Incorrect Correct answer

Correct

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Question 5 of 10

5. Question

The principal difference between a market hours Immediate or Cancel order and a system hours Immediate or Cancel order is:

The market hours IOC order is immediately executable upon entry between 9:30 am and 4 pm ET on the day entered, or it will be canceled.
Correct Incorrect Correct answer

A systems IOC order is immediately executable upon entry between 4:00 am and 8:00 pm ET on the day entered, or it will be canceled.
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Both orders call for an immediate execution upon entry of up to a certain number of shares at a specific price, with cancelation of the unfillable portion of the order.
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Any of the above.
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Correct

Incorrect
Question 6 of 10

6. Question

Pegged orders are often used to give investors and market makers greater flexibility in adjusting to market conditions during the trading day. Each of the following statements are true regarding these types of orders except:

Market pegged orders are pegged to the opposite side of the market
Correct Incorrect Correct answer

Primary pegged orders are pegged to the same side of the market
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Mid-point pegged orders are not permitted under NASDAQ rules
Correct Incorrect Correct answer

All of these are correct
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Correct

Incorrect
Question 7 of 10

7. Question

Under the limit order protection rules of the SEC, trade-through transactions are generally not permissible, with the exception of:

Volume-weighted average price orders
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Intermarket sweep orders
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Both a. and b
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Neither a. nor b
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Correct

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Question 8 of 10

8. Question

Compute the Volume Weighted Average Price using the following trade data: 1,000 shares traded at 120; 3,000 shares traded at 121; 5,000 shares traded at 121.40; 2,000 shares traded at 121.20; 4,000 shares traded at 121.60; 500 shares traded at 120.90:

120.45
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121.10
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121.24
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121.38
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Correct

Incorrect
Question 9 of 10

9. Question

The minimum net capital requirement for a market maker making 100 markets in stocks below $ 5.00 per share and 800 market in stocks price above the $ 5.00 price level will be:

$ 2,100,000
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$ 1,500,000
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$ 1,000,000
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$ 250,000
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Correct

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Question 10 of 10

10. Question

Regulation M Rule 103 pertains to passive market making restrictions. Which of the following statements is accurate?

Passive market making applies when a member firm is a participant in an IPO
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Passive market making applies when a member firm is planning on becoming a market maker after participating in a public offering of securities as a syndicate member
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Passive market making only applies when participating in the underwriting of an OTC non-NASDAQ issuer
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Passive market making applies when a syndicate member in a follow-on offering is also a market maker in the outstanding shares of the issuer
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Correct

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