Stock Broker Cheat Sheet 2026

The 30 highest-yield Stock Broker facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. A broker-dealer that holds customer securities and cash must comply with which rule regarding segregation of customer assets? → Rule 15c3-3
2. The subtotal that emerges from removing cost of goods sold and operating expenses from sales on a company's income statement is: → Operating profit
3. What is the 'code of conduct' that all FINRA-registered representatives must adhere to regarding conflicts of interest? → Disclose and manage all material conflicts of interest with customers fairly
4. Which type of annuity provides a guaranteed fixed payment amount throughout the payout period? → Fixed annuity
5. What does 'churning' refer to in the context of broker-dealer regulations? → Excessive trading in a customer account to generate commissions
6. What is a 'Treasury Inflation-Protected Security' (TIPS) and how does it protect investors? → A Treasury bond whose principal adjusts with the CPI, protecting purchasing power
7. Which strategy profits most in a neutral market where the stock price remains flat near the strike price? → Short straddle
8. What is 'beta' as a measure of risk in securities analysis? → A measure of a security's price volatility relative to the overall market
9. A consumer who owns 100 shares of stock may be protected by: → Buying a put
10. What is a 'circuit breaker' in US equity markets? → A regulatory mechanism that halts trading when major indexes fall by specified percentages
11. Which of the following measures is the greatest for a bond investor to decrease credit risk while also guarding against buying power risk? → Invest in bonds from many different issuers
12. Which of the following types of investors are considered institutional? → All of the above
13. What is the 'T+1' settlement standard for US equity trades? → Trades settle (transfer of securities and cash) one business day after the trade date
14. Which type of option gives the holder the right, but not the obligation, to SELL shares at a specified strike price? → Put option
15. What does 'in the money' mean for a call option? → The strike price is below the current market price
16. Which mutual fund share class typically has no front-end sales load but charges a contingent deferred sales charge (CDSC) if sold within a certain period? → Class B shares
17. What is a money market instrument, and which of the following is an example? → A short-term debt security; Treasury bills (T-bills)
18. What is a call option? → The right to buy shares at a specified strike price
19. What is the minimum net capital requirement concept that prevents broker-dealers from operating with excessive debt relative to assets? → Net capital rule
20. An American Depositary Receipt (ADR) allows US investors to do which of the following? → Invest in foreign company shares traded on US exchanges in US dollars
21. Which regulation governs the extension of credit by broker-dealers to customers purchasing securities on margin? → Regulation T
22. What is a convertible bond? → A bond that can be exchanged for a set number of the issuer's common shares
23. Under SEC Regulation S-P, broker-dealers must provide customers with privacy notices describing how the firm handles which type of information? → Non-public personal information
24. Under FINRA Rule 2010, members must observe 'high standards of commercial honor and just and equitable principles of trade,' which is also known as what? → The just-and-equitable rule or standards of commercial honor
25. Convertible preferred stock's price is more influenced by _______________ and less by _______________ than other types of preferred stock. → The price of the common stock; interest rates
26. What is a 'limit order' and what is its key advantage over a market order? → An order to buy or sell at a specified price or better; guarantees price but not execution
27. In a Short Margin Account, what is the equity formula? → + Credit - Short Market Value = Equity
28. What is the purpose of FINRA's arbitration forum for disputes between customers and broker-dealers? → To provide an alternative to court litigation for resolving disputes
29. The Securities Act of 1933 is primarily concerned with the registration of:Which of the following is defined as "advertising" in the Securities Act of 1933? → Options website
30. Which type of bond is backed by the full faith and credit of the US government and is considered the safest fixed-income investment? → US Treasury bonds