RIA Securities Law & Regulations

Question 1

The Securities Act of 1933 primarily regulates:

Accepted Answer

The issuance and initial sale of new securities

Answer

The Securities Act of 1933 governs the primary market—the initial offering and sale of new securities to the public.

Question 2

Under the Securities Exchange Act of 1934, the SEC has authority over:

Accepted Answer

Secondary market trading and broker-dealers

Answer

The 1934 Act created the SEC and gave it authority to regulate securities exchanges, broker-dealers, and secondary market trading.

Question 3

The Investment Company Act of 1940 primarily regulates:

Accepted Answer

Mutual funds and other investment companies

Answer

The Investment Company Act of 1940 regulates the organization, operation, and governance of investment companies, primarily mutual funds.

Question 4

Which of the following is NOT a security under the Securities Act of 1933?

Accepted Answer

Fixed annuity contracts

Answer

Fixed annuity contracts are insurance products regulated by state insurance commissions, not federal securities laws.

Question 5

Regulation D exempts certain offerings from full registration. Which investor type can participate in Reg D Rule 506(b) offerings?

Accepted Answer

Accredited investors and up to 35 sophisticated non-accredited investors

Answer

Rule 506(b) allows unlimited accredited investors and up to 35 sophisticated non-accredited investors, but general solicitation is prohibited.

(RIA) Registered Investment Advisor Practice Test