Practice Quiz

FINRA Series 63 (NASAA)

Category - Series 63

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A bond issue has recently been registered with the state Administrator. Which of the following statements are true?
  1. An investor can feel secure in buying the bond because it has recently been registered, which means that the state Administrator finds it to be of sound quality at this point in time.
  2. The bond may now be offered for sale in the state.
  3. The issuer may now offer this bond for sale, and any other bonds that the issuer may want to offer for sale in the future will be able be sold after the issuer executes a notice filing.
  4. Both A and B are true statements.
Explanation
Answer: B - When a bond issue has been effectively registered with the state Administrator, it can be offered for sale in the state. The bond’s acceptance by the Administrator simply means that the issuer has supplied enough information in order for an investor to judge the quality of the bond for himself; it in no way implies that the bond is of sound quality. It could, in fact, be a very risky security and still have met the registration requirements.
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