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SIE Readiness Assessment

Let’s Put Your Knowledge to the Test

10 questions. One shot. See how dialed in your exam-day prep is and see what's missing.

Think you're ready? Let’s find out.

Start

Question 1 of 10

When the time value of an option is equal to its premium, the option is:

A

Likely to be exercised

B

Out-of-the-money

C

In-the-money

D

Trading at parity

Question 2 of 10

An investor buys a bond with a 4.5% coupon rate to yield 5.5%. If the company decides to call the bond at par before maturity, what will the investor's return most likely be?

A

4.5%

B

Less than 4.5%

C

5.5%

D

Greater than 5.5%

Question 3 of 10

Isla takes a distribution from her non-qualified annuity of $30k, of which $20k is cost basis and $10k represents earnings. Assuming she is over age 59 1/2 and the account was established more than one year ago, what would the tax consequences be?

A

$30k is fully taxable as ordinary income

B

Only the $10k gain is taxable as ordinary income

C

Only the $10k gain would be taxed at long-term capital gains rates

D

The full distribution is tax-free as the investor is over age 59 1/2

Question 4 of 10

Which of the following investments represents a direct obligation of the U.S. government?

A

City of Detroit 6% General Obligation Bond

B

GNMA Certificate

C

Corporate AAA Bond

D

FNMA Certificate

Question 5 of 10

For an initial public offering, when does the cooling-off period begin? 

A

20 days after the application date

B

On the effective date

C

Upon publishing the "tombstone" ad

D

On the filing date

Question 6 of 10

During a period of rapidly rising inflation, which of the following would be positively impacted?

A

Real estate values

B

Price of fixed-income investments

C

Purchasing power

D

Borrowing costs

Question 7 of 10

When income is the primary investment objective, an investor's portfolio would be LEAST likely be focused on:

A

Preferred stock

B

Treasury bonds

C

Fixed annuity

D

Common stock

Question 8 of 10

An investor can avoid reinvestment risk by purchasing which of the following investments?

A

A blue-chip stock

B

Shares of a publicly traded REIT

C

T-STRIP

D

Agency bond

Question 9 of 10

Rocky wants to purchase 100 shares of Tesla Inc. (TSLA) now trading at $345 per share. Which of the following instructions would be valid for a buy limit order?

A

Buy 100 shares at a limit price of $350

B

Buy 100 shares at a stop limit price of $350 stop, $345 limit

C

Buy 100 shares at a limit price of $345

D

Buy 100 shares at a limit price of $342

Question 10 of 10

One of the owners in a joint account requests a cash withdrawal from the account. The broker-dealer is required to do which of the following?

A

Explain that BOTH account holders will be required to provide authorization for the withdrawal

B

Explain that the request must be made in writing and cannot be taken verbally

C

Send the distribution as requested, and make it payable to the owner who made the request

D

Send the distribution as requested, and make it payable to BOTH of the account holders

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