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FINRA Series 65 Practice Exam & Test Questions - Topics



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Understanding what is on the Series 65 RIA exam is crucial step in preparing for the exam. You will need to have an understanding of the testing domain (topics covered) to be sure you are studying the correct information.

  • Directs your study efforts toward the most relevant areas.
  • Ensures efficient and adequate preparation.
  • Helps identify strengths and weaknesses.
  • Allows for a focused approach to address gaps in understanding.
  • Aligns your preparation with the exam's expectations.
  • Increases the likelihood of success.
  • Keeps you informed about your field's current demands and standards.
There is no doubt that this is a strategic step in achieving certification and advancing your career.

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Series 65 Uniform Registered Investment Adviser Law Exam Exam Blueprint

Understanding the exact breakdown of the Series 65 Uniform Registered Investment Adviser Law Exam test will help you know what to expect and how to most effectively prepare. The Series 65 Uniform Registered Investment Adviser Law Exam has multiple-choice questions The exam will be broken down into the sections below:

Series 65 Uniform Registered Investment Adviser Law Exam Exam Blueprint
Domain Name % Number of
Questions
Economic Factors and Business Information 14% 11
     Basic economic concepts
     Financial reporting
     Quantitative methods
     Types of risk
Investment Vehicle Characteristics 24% 18
     Types and characteristics of cash and cash equivalents
     Types and characteristics of fixed income securities
     Methods used to determine the value of fixed income securities
     Types and characteristics of equity securities
     Methods used to determine the value of equity securities
     Types and characteristics of pooled investments
     Methods used to determine the value of pooled investments
     Types and characteristics of derivative securities
     Alternative Investments
     Insurance-based products
Client Investment Recommendations and Strategies 31% 24
     Types and characteristics of cash and cash equivalents
     Types and characteristics of fixed income securities
     Methods used to determine the value of fixed income securities
     Types and characteristics of equity securities
     Methods used to determine the value of equity securities
     Types and characteristics of pooled investments
     Methods used to determine the value of pooled investments
     Types and characteristics of derivative securities
     Alternative Investments
     Insurance-based products
Client Investment Recommendations and Strategies 31% 24
     Type of client
     Client profile
     Capital Market Theory
     Portfolio management styles and strategies
     Portfolio management techniques
     Tax Considerations
     Retirement plans
     ERISA issues
     Special types of accounts
     Trading securities
     Performance measures
Laws, Regulations, and Guidelines, including Prohibition on Unethical Business Practices 31% 24
     State and Federal Securities Acts and related rules and regulations
     Ethical practices and fiduciary obligations

Series 65 Uniform Registered Investment Adviser Law Exam - Exam Topics Sample Questions

The rules regarding the communications broker-dealers and agents who are selling shares in an Investment Company can make to their clients include all but which of the following?

Correct Answer:
delivering a prospectus counts as “full and fair disclosure.”
to answer the question, it's crucial to understand what constitutes "full and fair disclosure" in the context of selling shares in an investment company. the rules governing these communications are designed to ensure that potential investors receive all necessary and relevant information to make informed investment decisions.

the first point mentions that solicitors must not imply insurance, credit quality, or guarantees for a security without disclosing other relevant investment risks. this rule is essential because it prevents misleading communications that could give investors a false sense of security about the risk level of an investment. by requiring disclosure of various kinds of investment risks, investors get a more realistic understanding of potential downside risks.

the second statement that delivering a prospectus counts as “full and fair disclosure” is actually incorrect. this is a key point of confusion often encountered in the rules of communication in financial services. while a prospectus is a critical document that provides detailed information about an investment, including its objectives, risks, charges, and expenses, it alone is not sufficient for full disclosure. nasaa (north american securities administrators association) guidelines clearly state that simply handing over a prospectus does not meet the requirement of full and fair disclosure. instead, broker-dealers and agents must actively ensure that they explain and clarify the contents of the prospectus, ensuring that the client fully understands all aspects of the potential investment.

the third point requires that all sales charges associated with purchasing, retaining, or redeeming shares must be disclosed to clients. this rule is crucial because it directly impacts the cost of investment for the client and potentially their decision to invest. transparent disclosure of fees and charges helps clients understand the total cost of their investment and prevents any hidden charges that could influence investment returns.

finally, the statement about the required disclosure of all discounts due to breakpoints is also accurate and important. breakpoints offer investors a discount on sales charges based on the amount of investment. disclosing these discounts can influence investment decisions, particularly if large sums are being invested, as it can lead to significant savings for the investor.

in summary, the incorrect statement among those provided is that delivering a prospectus counts as “full and fair disclosure.” this misconception might lead to inadequate information provision to the clients, potentially resulting in uninformed or misinformed investment decisions. the correct approach, as outlined by nasaa, requires more active communication and education efforts from the broker-dealers and agents beyond merely handing over a prospectus.