FINRA Series 7 Exam Prep

Category - Series 7

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Bubba is a registered representative who wishes to buy shares of a new issue his firm is distributing. Under FINRA Conduct Rules, Bubba may:

not do so under any circumstance
do so if he has a history of buying hot issues
not do so for his own account, buy may purchase shares for his sister’s account
do so if his allotment is insubstantial and not disproportionate to public orders

Explanation

Answer: A - not do so under any circumstance. New issues may not be distributed to Bubba or members of his immediate family.

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