Series 6

Review 316 SERIES-6 practice questions with answer explanations and community insights.

Question 1

Which of the following statements about the over-the-counter market is true?

  1. Only penny stocks are traded in the over-the-counter market.
  2. Trades in the over-the-counter market are conducted via the auction process.
  3. Only bonds and other debt instruments are traded in the over-the-counter market.
  4. Stocks that are listed on exchange floors are also traded in the over-the-counter market.

Question 2

All government bonds and the majority of corporate bonds are traded:

  1. on the floor of the NYSE.
  2. via electronic communication networks (ECNs).
  3. on regional exchanges.
  4. in the over-the-counter market.

Question 3

Which of the following types of securities would not be traded in the over-the-counter market? I. stock options - II. government bonds - III. corporate bonds - IV. corporate stocks -

  1. I only
  2. I and IV only
  3. III and IV only
  4. All of the choices are traded in the over-the-counter market.

Question 4

Which of the following are duties of the specialist on an exchange floor? I. executing limit orders if/when the limit price specified is reached II. minimizing any imbalance in supply and demand for the stock(s) that the specialist is assigned III. determining an opening price for each assigned stock every day IV. serving as an auctioneer for the shares of the assigned stocks

  1. I and II only
  2. I, II, and IV only
  3. I and IV only
  4. I, II, III, and IV

Question 5

The price at which an investor can sell a security to a market maker in the over-the-counter market is called the:

  1. sale price.
  2. put price.
  3. bid price.
  4. ask price.
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