Practice Quiz

FINRA Series 63 (NASAA)

Category - Series 63

Start a Study Session Sign up for Question of the Day
Mr. Bigwig, CEO of HiGrowth Corporation, meets with the president of BigFee Investment Bankers and arranges for BigFee to underwrite an Initial Public Offering (IPO) for the firm. When the IPO comes to market, GetErDone Broker-Dealers is part of the selling group, which handles the sale of the stock to the public. In this scenario, which party is acting as a dealer?
  1. HiGrowth Corporation
  2. Mr. Bigwig
  3. BigFee Investment Bankers
  4. GetErDone Broker-Dealers
Explanation
Answer: C - BigFee Investment Bankers is acting as a dealer. In underwriting the securities, the firm is purchasing them from HiGrowth and selling the securities to the public. If the securities don’t sell for the amount that BigFee thinks they can, BigFee takes the loss as owner of the securities.
Was this helpful? Upvote!
Login to contribute your own answer or details
Start a Study Session Sign up for Question of the Day

Top questions

Related questions

Most popular on PracticeQuiz