Equity Securities Flashcards
6 cards from real SIE practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 Equity Securities flashcards as text
What is the primary market?
Answer: Where newly issued securities are sold for the first time
The primary market is where new securities are first issued and sold, with proceeds going to the issuing company.
An Initial Public Offering (IPO) occurs when a company:
Answer: Lists its shares on a stock exchange for the first time
An IPO is when a private company first offers its shares to the public on a stock exchange.
What does EPS (Earnings Per Share) measure?
Answer: Net income divided by total outstanding shares
EPS is calculated by dividing a company's net income by the number of outstanding shares.
Blue chip stocks are generally characterized by:
Answer: Large, well-established companies with stable earnings
Blue chip stocks represent financially stable, large-cap companies with long track records of reliable performance.
A stock trading 'ex-rights' means the shares are trading:
Answer: Without the right to receive the upcoming rights offering
When stock trades ex-rights, buyers do not receive the subscription rights associated with the upcoming rights offering.
Convertible preferred stock can be exchanged for:
Answer: A fixed number of common shares
Convertible preferred stock can be exchanged for a predetermined number of common shares at the holder's option.