Sample Questions

1. Using multiple asset classes in an investment portfolio reduces which of the following?

a) Liquidity risk
b) Credit risk
c) Interest rate risk
d) Market risk

2. Under the Securities Act of 1933, which of the following is NOT a security?

a) Futures contracts
b) Corporate bonds
c) Investment contracts
d) Stock options

3. Under the Uniform Securities Act, “sales” include which of the following?

I. Giving a security as a bonus for a securities purchase
II. Making a bona fide loan of stock
III.Entering into a contract to sell a security for value

a) III only
b) I and II only
c) I and III only
d) I, II, and III

4. Which of the following statements is true about required minimum distributions for traditional IRAs?

a) They must begin when the individual retires.
b) They must be completed over a five-year period.
c) They are mandatory as of April 1 following the calendar year in which the owner reaches age 59 1/2. d) They are mandatory as of April 1 following the calendar year in which the owner reaches age 70 1/2.

5. A husband and wife are 55 and 57 years old, respectively. The husband plans to retire at 62 and the wife at 65 and both are healthy. What is the most appropriate estimate of the time horizon for their retirement portfolio?

a) 5 years
b) 7 years
c) 8 years
d) 20+ years