Test Prep

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Share Categorization Questions on the Series 7 Exam

All publicly held corporations have a certain quantity of shares that they can sell based on their corporate charter. The Series 7 exam covers how these shares are broken down into a few categories depending [more…]

Questions about Splitting Common Stock on the Series 7 Exam

You may ask yourself, “Why would a company split its stock?” The Series 7 may also ask you about this choice. The obvious answer is that the company wants to make the market price of the security more [more…]

Series 7 Exam: Sharing Corporate Profits Through Dividends

The Series 7 exam expects you to know the forms of dividends an investor can receive and how the dividends affect both the market price of the stock and an investor’s position. If a corporation is profitable [more…]

What You Need to Know about Preferred Stock for the Series 7 Exam

You will need to understand preferred stock for the Series 7 exam. Equity securities represent shares of ownership in a company, and debt securities represent debt. Preferred stock is an equity security [more…]

Special Securities Questions on the Series 7 Exam

As you will need to know for the Series 7, some securities fall outside the boundaries of the more normal common and preferred stock, but they still involve ownership in a company or the opportunity to [more…]

Series 7 Exam: Types of Bond Certificates

To make your life interesting while preparing for the Series 7 exam, bond certificates can be delivered in different forms. Even though some types of bonds are no longer being issued, you’ll still be tested [more…]

What You Need to Know About Secured and Unsecured Bonds for the Series 7 Exam

For Series 7 purposes, you will need to understand secured and unsecured bonds. Assume that bonds backed by collateral are considered safer for the investor. [more…]

How to Calculate Bond Prices and Yields on the Series 7 Exam

The Series 7 exam tests your knowledge of bond prices, bond yields, and how to calculate them. You will also need to know how accrued interest can affect how much customers have to pay for the bond. [more…]

How to Calculate Accrued Interest for the Series 7 Exam

When taking the Series 7 exam, you need to be able to calculate the number of days of accrued interest that the buyer owes the seller. Although you can calculate the accrued interest with a few different [more…]

How to Determine the Best Investment on the Series 7 Exam

As you grind your way through Series 7 exam questions, you may be asked to determine the best investment for a particular investor. You need to carefully look at the question for clues to help you choose [more…]

Series 7 Exam: Types of U.S. Government Securities

On the Series 7 exam, you need to know the basic types of U.S. government securities, their initial maturities, and certain characteristics. As you may already know, the U.S. government also issues bonds [more…]

Collateralized Mortgage Obligations Questions on the Series 7 Exam

CMOs, or collateralized mortgage obligations, are annoying little (or big) debt securities backed by pools of mortgages and are covered on the Series 7. What makes matters worse is that you probably won’t [more…]

Series 7 Exam: How to Select the Right Account for Your Clients

Besides knowing a customer’s investment profile, you need a basic understanding of the types of accounts for the Series 7 exam. Investors can open many different types of accounts through a broker-dealer [more…]

How to Analyze General Obligation Bonds on the Series 7 Exam

The Series 7 exam tests your ability to analyze different types of municipal securities and help a customer make a decision that best suits her needs. Because they’re backed by taxes rather than sales [more…]

What You Should Know About Revenue Bonds for the Series 7 Exam

You will need to become familiar with Revenue Bonds for the Series 7 Exam. Unlike tax-backed bonds, revenue bonds are issued to fund municipal facilities that’ll generate enough income to support the bonds [more…]

Municipal Bond and Note Questions on the Series 7 Exam

The Series 7 will expect you to have a good grasp on types of municipal bonds and notes. Along with standard revenue and GO bonds, you’re required to know the specifics of the following types of municipal [more…]

How to Calculate the Numbers in Long Margin Accounts on the Series 7 Exam

The Series 7 asks you to calculate the numbers in a long margin account, which isn’t too difficult if you take it one step at a time. The basic long margin account formula is as follows: [more…]

How to Calculate Short Margin Accounts on the Series 7 Exam

On the Series 7 exam, you may be asked to calculate the numbers in a short margin account. You have to start by setting up the formula correctly. The basic short margin account formula is as follows: [more…]

Special Memorandum Account (SMA) Calculations on the Series 7 Exam

The Series 7 will expect you to know the skinny on SMA’s. A special memorandum account (SMA) is a line of credit that a customer can borrow from his margin account or use to purchase more securities on [more…]

Restricted Accounts Calculations on the Series 7 Exam

Often, securities don’t go in the direction customers hope for and you have to deal with restricted accounts. The Series 7 will expect you to be prepared for both scenarios. When this happens in a margin [more…]

How to Use the Dollar-Cost Averaging Formula on the Series 7 Exam

If an investor is employing the dollar-cost-averagingformula, she is investing the same dollar amount into the same investment periodically. The Series 7 will expect you to be familiar with this formula [more…]

Open-end Funds Calculations on the Series 7 Exam

You need to know two basic formulas to determine the sales charge and public offering price of open-end funds. The Series 7 will expect you to be prepared to use multiple formulas, but fortunately, you [more…]

What You Should Know About Annuities for the Series 7 Exam

Annuities are similar to mutual funds, except annuities are designed to provide supplemental retirement income for investors. The Series 7 exam tests you on the two basic types of annuities: fixed and [more…]

Series 7 Exam: Direct Participation Program Paperwork

For the Series 7, you need to know about certain paperwork that’s specific to limited partnerships. Direct participation programs (DPPs) can raise money to invest in real estate, oil and gas, equipment [more…]

What You Should Know About Partnerships for the Series 7 Exam

Certainly partnerships can be formed to run any sort of business that you can imagine, but the Series 7 exam focuses on the big three: real estate, equipment leasing, and oil and gas. You need to be able [more…]

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