Practice Quiz

FINRA Series 6

Category - Series 6

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A face-amount certificate company:
  1. is a company that invests primarily in bonds that sell at either par value or a premium.
  2. is an investment company that has management fees.
  3. sells its debt, which is backed by the assets owned by the company, to its investors.
  4. is all of the above.
Explanation
Answer: C - A face-amount certificate company sells its debt, which is backed by the assets owned by the company, to its investors. It does not invest primarily in bonds that sell at or above par value, and it does have management fees that are paid to the portfolio managers of the company.
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