well greetings test takers this is Dean Tenney coming to you from my studio here in fabulous Las Vegas uh welcome to the first leg of your testing Journey the Sie I have made a video for series seven called tips tricks and memory aids and a lot of people who watch that video said well Dean I wish that would have been available on the first leg of my testing journey and so uh I'm making a version of that that is about the Sie and hopefully we'll help you become a better test taker on your your journey I suggest learning the information is a better way to go but when all else fails maybe having a test taking trick or memory aid in your uh arrow in your quiver it could be helpful like always my channel this video everything's a buffet take what you like leave what you don't uh I'm glad to uh get more and more people that are using the channel for the Sie you know I always joke I come into your life or reason and a season the reason is to pass your exams and the season is how long it takes you to do that so I'm glad to be with you on the first leg hopefully if you're taking a second leg six seven we can help you there as well and uh your final leg would typically be a NASA exam 63 65 66 we have content for all of that uh the channel was uh mainly I started the channel to have a direct connection with test takers uh provide a free supplement to their paid study materials not dependent on your firm or your test prep vendor and the Seven is has been more than half of our views but that Sie is coming up quick so I'm glad the Sie is out there share with you your folks uh so we can get people earlier in their journey and help them out all right so let's get started on today's video uh today's video is tips tricks and memory aids and let's get started here boom again learning the information is a better way to go but when all else fails then you know we whip out a test taking trick now some people are intuitively already good test takers and so these are just trying to formalize some things that perhaps uh they're aware of I don't know about you but you know when I was in college sometimes it would be uh uh you try not to you know focus on somebody else's Journey but I go man that guy stayed up all night did the study and got a B plus I worked my butt off and I got an A minus there is uh folks that are better test taker than others so we can turn you into a better test taker and just give you some confidence that's worth some points all right so let's get started uh we're first in the first part of the video we're going to be talking about test taking skills and the second part we're going to be talking about memory aids uh that might be helpful on the Sie so in this first part of the video we're going to talk about rtfq read the full question and read the full answer set you know I I'm guilty of this I can't tell you how many times I miss a question because I answer a question I thought was there instead of the question I was being asked I picked out a couple examples of this even one that I recently just missed myself as a person who knows it's embarrassing to miss an acie question right so uh and you have a long and a long question yeah so let me just get these paragraph long questions you go oh my goodness where does this thing end up so one thing you might want to do on a longer question is read that lessons first I have some examples of this based on the Sie content that we'll look at basically I pull questions from the uh finra Sie practice exam on the finra website and some Kaplan uh questions and then some questions that I are my questions I use in my content uh project the correct answer so sometimes you know I know I know something and so I'm looking at the answers set it's not offered to me and so I got to say okay well here's the answer I had mine what is the answer they're close most closely approximates what I'm looking for uh process of elimination this works really uh much much better as you get better and better at the content as you lay more base content you'll be able to eliminate some answers and even if you can't eliminate all of them I mean we can eliminate three we have the answer we've arrived at the answer but even if we get like 50 50 we eliminate two then you know that gives us a 50 50 you're either one of four that's a great way to go and again we'll do an example of that reduction to the ridiculous this is one of my favorites this is where you take an answer that's offered to you and say okay if I say that's true what kind of a world does it lead to can it sustain itself in terms of reduction to the ridiculous I can't tell you how many times I've used this over the years with people I'm supervising you know I say okay so that's your answer is that really the answer you want to tell me because now we're going to take your answer and see if that really will withstand reduction to the ridiculous the principal Mutual exclusion this is like uh two things that can't be true in the same universe for example Socrates is a dog Socrates as a philosopher it can't be both a dog and a philosopher in the same universe he's one or the other the Sesame Street trick I call this one of these things is not like the other for example taxes taxes taxes fees I said oh that's the one I like uh true false next to each answer so we read each answer offered to us and put a t or an F next to it and again this is very helpful particularly on the accept format because they're asking me which is true or which is false and again it's like the others we've talked about you can use them in conjunction with each other but even if you don't get all of them at least if you get a couple of them you're Levering your way into a better odds a higher probability of a right answer uh too long to be wrong this is based on test writers so test writers a lot of times what they do I have a friend who gets mad at me because he falls prey to this all the time you know uh he starts by writing his answer lots of test writers do and he writes a beautiful answer and then the question and then he fills in the distractors distractors the detectile name for the right right uh wrong answers and uh you know I said man he really likes that choice D there because it's a paragraph one so it's either a really great distractor or it might be the right answer now remember we only use these when all those fails but I'll give you an example of this as well so remember these are to be used uh you know after all else fails so learn the information uh and then after we get done giving you examples of these we'll talk about some memory aid devices so uh let me flip over my little egg timer I'll try to keep these in a reasonable length of time but you know my channel is longer form content so there's a pause button I don't feel any uh need to be too worried about the you know staying on the clock all right so read the full question the rtfq here we go a customer a company issue stock the stock issued is Junior to the bond odors in liquidation and the stockholders will only receive a dividend if declared by the board of directors now if I don't read the last sentence and I just chopped the answer set I think the answer is a common stock but then it says last sentence so important the stock issued will have no voting rights and so that means the answer is not common stock the answer is preferred stock so as an example if you don't read the full question I told you this little knife almost guilty of myself as not reading the full question here's another example of reading the full answer set so our security is issued by municipality treated for tax purposes toys a says they pay exempt from both state and local only you know again I might be going quick and say okay well let's say you know why don't I make sure that there's not something being better offered to me you know B interest paid is fully tax absolutely not I can toss that out the interest they pay is not taxes State local Federal Level D the interest they pay is federally tax exempt so now I got to think okay well what's the best answer well you can't tell me a or C without determining suitability so without knowing where you live and what kind of bond you're going to buy you can't tell me a or C so D becomes the most appropriate answer so there's an example again where if you don't read the full answer set now don't bring bringing extra stuff into questions I can't tell you how many times people overthink things I had a guy who gave me a scenario the other day and I said where is that in the question no where in the question does it have anything that like that as well you know so you make sure you don't bring extra stuff uh here's another one here's one that uh I missed uh because I again rtfq this is one from kaplan's qbank uh shout out to Kaplan uh Kaplan uh allows people to get free look at Kaplan content uh you know my viewers subscribers members and uh if you choose to supplement with a Kaplan Q bank or a Kaplan quick cheek which I highly recommend my discount code at checkout is Guru 10 you get a 10 discount for uh giving the commercial we get to use a Kaplan content and stuff like this anyways here's ones I missed yesterday uh going over an Sie practice final with somebody your client Janice Thomas is an active investor and wishes to invest in a managed Equity portfolio I miss the word managed that she can trade in today so Dean missed that word and I thought oh she's an active investor ETFs are trading vehicle that people trade on a daily basis and I pick D and exchange traded fund been exchange traded funds are typically passive managed so by missing that one or passively you know not actively managing the ways of that by missing that word managed I miss what should have been a pretty easy question which is a closed-in fund right a very test will be able to contrast By the way again this isn't a lecture but boy you know that answer set is a very testable on your Sie so you better be able to tell me what an ETF is what an etn is what a closed invent is and contrast open with closed and opened with ETFs but anyways that's not what today's video is about today's video is about tips tricks and memory aid so the answer there was B and yours truly missed it with d because I missed the word managed I just locked on to intraday active investor and ah ETF you know read the last sentence first so here's an example of that you know I got a paragraph like oh my goodness which of the following stocks would be resilient to the business cycle I go okay none of that other stuff matters it's a defensive stock and now I accidentally gave you some helpful information about what a defensive stock is right so that first part has nothing to do with answering this question so sometimes I like to read the last sentence first just to kind of see where it all ends up but it doesn't mean I'm not going to read the whole question the full question but if I read that last sentence sometimes I can then I say okay this is where it ends up at the end of the day I didn't put the answer here but you know we can again shop the answer set once we're once we're done so uh here's an example where I know I know the balance sheet equation the classical balance sheet equation is assets minus liabilities equals net worth and so I'm looking for that as an answer I'm looking for assets minus liabilities equals net worth and I go damn that ain't offered to me so you don't want to panic and say man I thought I knew this so then what you got to do is once you projected the correct answer and it's not there you know maybe it's there you go okay there's the answer I'm looking for boom but every once while that answer may not be there okay okay well I know I know this what's something that's similar and yeah I would say oh d yeah the balance sheet balances right assets equals the liabilities plus the net worth so the answer is D so the key thing here is when you're projecting the correct answer hopefully it's uh available to you and then the other thing is if not then what you want to do is find the answer the you know is what you're thinking this can be particularly uh helpful if you are using a test prep vendor you know I think Kaplan is the best qbank but you know if you're using a test prep vendor and you learn the information you won't be as well prey to this if you actually know the concepts and not have it memorized phraseology now if you've memorized questions and answers in phraseology but you don't have an understanding it's easier to miss what shouldn't questions you shouldn't miss that you should be able to kind of reverse engineer an answer that's similar that being said most of your Sie is indeed recognition uh process of elimination I pulled this one from the finra practice exam uh version for on the finra website and so process of elimination means I'm going to eliminate answers that I you know think aren't going to be right so when was I get out my annotation tool you can't write on their screen because they'll get upset with you but uh you know uh volunteering is a youth soccer league coach I go well no volunteering isn't uh something for pay and I I can eliminate that that's not something I'm going to have to tell my firm about uh process donation gambling resulting in winnings in excess of ten thousand dollars so you come visit uh Dean here in Las Vegas and we have dinner and drinks and you you know go out on the tables and you win twenty thousand dollars now here what they're probably trying to get you to think is there's something about ten thousand there is it's called this currency transaction report but that has nothing to do with answering the question so they're very good at in you know and an answer set giving you something you go man that sounds familiar that 10 grand that 10 grand is has nothing to do with this question which is about a registered rep making a written notification to the firm this rule is called outside business activities and this is not an outside business activity so we can eliminate that one uh driving part-time for a transportation Network company on weekends so yeah does your broker either want to know if you're driving for Uber or Lyft they most certainly do now maybe I'm not sure about C but then I look at D let's suppose I'm not sure about C so rather than now marcoing it out I say well let me look at the selling non-proprietary Investment Company Securities products through her firm oh that's what you do that's a mutual fund that's you having your firm having a selling agreement with Franklin funds or American Funds or some mutual fund family and you know it doesn't matter by the way if it's proprietary or not as long as it's again on your approved product list and so D does not require you to make red nose because your firm knows you're doing that in fact that's what you're supposed to be doing so through process of elimination uh the answer is uh C now by the way even if you can't get all of that to the final answer at least now let's say I wasn't sure here 50 50 is still better than you know one and four right so here's reduction to the ridiculous so remember reductions are ridiculous is this idea does this uh can this be truthful so all the following are true of uniform transfer to miners act our uniform gift to minors act except the miners ID is used that is true one custodian one minor per account that is true no margin that is true now remember if I did my work I probably don't need a trick here I go okay well I know those are true so thank you very much it's D but let's suppose you weren't sure about a b or c and you look at D and it says if a minor dies before the stipulated age the assets go to the custodian so you say well now let me think what that would lead to that would lead to a world reduction to the ridiculous where custodians are killing miners to get control of the assets that can't possibly be true because it doesn't sustain itself in reduction to the ridiculous so this is where we take an answer like d and say okay I'm not sure if that's true or not let me see what it would lead to if I take it to its Nth Degree and see if it can sustain itself if it can that it's a good answer I told you this one I used to use all the time uh you know with people I'm supervising saying okay that's your answer are you sure that's the answer you want of all the answers available to you because now we're going to see what the world looks like if that is an answer that is uh you know acceptable and works uh we talked about this one principal Mutual exclusion so as a good test taker I don't need to burn up brain cells on C and D I don't have to burn up brain cells on c d because A and B are mutually exclusive it can't be a and b in the same universe this is you know socrates's dog Socrates is a philosophies one or the other so here it says convertible debt has a higher coupon B says it has a lower coupon it either has a higher or lower so even if I don't know the answer to this question I have a 50 chance one and two a conversion feature we're not lecturing is an advantage to the issue and it lowers the coupon they would pay so he said except now I got to be careful because it's at accept so a it doesn't have a higher coupon it has a lower coupon uh by the way if you are getting good as a test taker the other thing now you can do knowing that it's a or b is know that C or D C and D are truthful information that they gave you for free that perhaps you can lose down the road so I say well before I move on to my next performance opportunity that's why I call questions yeah I said let me see what c d says a potential dilution well I didn't know that thank you very much or I did know that oh well let's see if I can get some free information on D conversion terms have to be adjusted for stock dividends and stock splits well I knew that too but if I didn't I say thank you very much uh here's another one I pulled this one from the Sie practice exam and Pooch principal Mutual exclusion means we can just go down the answer set and C and D say opposite things so it can't be C and D in the same universe you know sees has higher management fees and B says lower management fees it's one or the other right so it says which of the following best describes by the way that means I know A and B doesn't describe that you know you buy an index fund because you know you're going to have a be more efficient you're willing to accept a market-based return so it says uh what's the long best describes lower management fees do the passive management of the fund the answer is D is and Dot again we're not doing lectures here on an index fund what we're doing is talking about tips tricks and memory aids and this is again a trick where I say as a test taker it can't be C and D in the same universe so I have a 50 chance even if I don't know anything about index funds right which is which is the point of being a good test taker you know sometimes you know people who are good test takers can get questions right that they probably don't deserve to get right but they're good test takers whip uh here's another one I pulled this from Kaplan this is a shout out to Kaplan this is Kaplan qid146-5298 if you're using the capital Q bank for your Sie study effort and again I shot the answer set and CND uh say different things it can't be both C and D in the same universe right so C says your subject to volume limitations and D says you're not so it's one or the other an officer of a public company buys a thousand chairs the company's registers dock in the open market there's no hold on that you know when Larry Ellison became a board member at Tesla about three million shares of Tesla in the secondary Market there is no hold on that and then Tesla gave him another million shares for serving the board that is unregistered stock he got directly from the issuer that would have a six month old but here there's nothing about stock that is unregistered that you got from the company and so uh you don't have a six-month hold on it but you're going to always be subject to the volume limitations D again we're not talking about you know lectures here we're just talking about test taking tips tricks and memories and here's another example of mutual exclusion C and D say opposite things so it's typically going to be one or the other uh Sesame Street trick one of these things is not like the other now again it would always be better that if you knew revenue bonds are backed by user fees as I shop the answer I say taxes taxes taxes fees fees looks different so I think I'm gonna go with d right so there's an example of a Sesame Street trick the you know I don't know how I'm dating myself I don't know if you guys know what Sesame Street is 70 Street was an educational PBS show and they had this segment called one of these things was not like the other you know they show you you know apple apple orange you know I was watching a game show the other night it was Tajikistan Pakistan Kazakhstan and India and not knowing the answer I thought well India is different it doesn't end at the stand so it'll be better the dean knows his geography but I go okay I'm gonna go for that one here's another one so again I didn't even put the question here I didn't even put the question uh up here but here's the answer set and I say man that tip thing looks different now that's a treasury inflation protected security and I don't know what the question is but again I'm uh predisposed to say I like d you know maybe the question is which of the following keeps Pace with inflation something like that now again it may not be the answer I'm not don't watch this video and then start sending me all kinds of examples where the tricks don't work because remember the tricks are our last resort they're not something you're supposed to pass the test with it's when all else fails so you know you better read the question if it says which of the following has issued a discount it's going to be a so you know these are tricks tips tricks and memories uh put t or F next to each of them so generally speaking non-qualified plans so non-qualified plans non-qualified means they haven't met the qualifications of the Department of Labor and uh the terms under erisa and the IRS so must have IRS approval the answer to error is false you know you need IRS approval for qualified plans not non-qualified plans they must have a trust agreement that's false that's true of uh qualified plans I may not discriminate uh who can participate that is false they can the forgot would be an example they're funded with after tax dollars there's their true thing right so you know again very important again rtfq n-o-n three letters that change this question dramatically uh by the way it could have been another version of this answer so that could have been all along or to a qualified plans except qualify plans and it would have been D so maybe you can put it to your F maybe you can't put it to trf next to them all of them but again if you can put it one t and one F you get to a 50 50. so you're always trying to as a test taker lever your way into a higher probability of success on the question uh too long to be wrong too long to be wrong so here's another one I picked from the uh picked out of the finra uh practice exam version four uh Blue Sky laws are regulated by which of the following entities now I would prefer that you know the answer that SEC is federal I would prefer you know the msrb is the municipal Securities rulemaking board you know and they're ones who publish that rule G37 250 dollars and uh I would want you know finra is a self-regulatory organization but uh you know again these are tricks that when LS fails they go man that longer answer D State Securities rate Regulators right so D is the longest answer I told you why test writers fall prey to this and the guys who write tests as I told you they they start with what they're trying to test you on which is this idea of the state regulator and then they reverse engineer their distractors the distractors again are the technical name for wrong answers okay so that was our going over uh our of our last one this you know again I didn't even put this on the agenda but guess we move on hopefully you're operating from abundance and scoring well in your practice exams I was teaching a weekend class I thought this weekend class for years for this Investment Banking firm and this is the creme de La Creme the top uh uh men and women from you know Harvard and Princeton and Yale and Stanford and uh University of Pennsylvania the ward in the school and then they come uh you know into a class and I get them prepped for the series seven anyways what I used to do is strip off the answer key and just give them the practice questions and go over you know them with the next day anyways this guy uh I heard him telling somebody against B and I teased him unmercifully you know my problem is I don't know when it's not fun anymore I said man how much did we spend educating you and what you learned was the guest B oh he's next morning he threw back my my answers at me and he said Dean 44 of your answers are B without the answer key pretty impressive you know so anyways he said Dean Lee did a survey of people who write cram courses and we know the people who write cram courses and write tests more importantly people write tests psychometrics psychometrics is the art of writing tests know the people in cram courses are told primarily to guess C and people write test I know that and so they statistically shy away from C and so C used to be your best guess but now it's B now Liz again I suggest learning the information but ever since that guy said that when I have absolutely no clue on an exam I'm taking I guess B I assign it to the universe and I move on you know hopefully again you have abundance and you know that you can assign two or three four questions of the universe guess B and make it up elsewhere now uh even your study average that's where you want to get you don't want to be in an area where any one answer is going to make or break you in terms of pass fail all right so those were some uh tips and tricks as it relates to answering questions and so now I'd like to share with you uh some Memory aids that might be helpful on your Sie exam so one two three is a good way to remember accredited investors one two three so the one is to remind ourselves if it's a million dollars exclusive of their primary residence so there's our one let me get a bigger font here and then the two is two hundred thousand dollars an annual income with the expectation of 200 000 this year to be accredited and if they're married and filing jointly it's 300 Grand so a good way to remember that is one two three an accredited investor is somebody who has a million dollars net worth exclusive their primary residence one or two hundred thousand dollars in annual income for the last two years with the expectation of that this year or three three hundred thousand so one two three um uh you should have been able to eliminate uh a quib so you should have been able to get it to a answer set of either a b or c the answer here is B but you should have been able to limited D because you should know that a quib a qualified institutional buyer of Securities is an Institutional Investor managing a test question assets under management of 100 million or more and what a quib is allowed to do is buy unregistered foreign and domestic security so again just going in now process of elimination with a memory aid device so uh one and three and then one two three one two three is a good way to remember uh accredited investors all right let's try our next memory aid device uh customers buy high and they sell low you know so this is a helpful thing to remember if you're looking at let me get a bigger font uh you're showing a quote from a market maker and said let's say whoop say my they show you a bid on the test and they show you an ask on the test and they show you 15 16 five five by five and so as Dean just said here when you're asked about customers the customers always are buying high they can buy right now a customer can buy 500 shares at 16 and the customer can sell 500 shares at 15. so the customer always pays the high price the customer always receives the low price what's that called the Securities industry let me give another example here's an nav and a public offering price and let's say the nav is 9.15 and the public offering price is ten dollars so again the memory aid device here is the customer always pays the high price and always receives the low price right so I have a whole video on knowing your bid and your ass so 15 20 minutes on this it's definitely worth the watch okay but that's not what we're doing today today we're doing tips tricks and memories all right so let's go to our next uh memory aid whoop which is ABC a b u c this one is good to remind ourselves we're all called broker dealers but in any one transaction where you're going to be acting in our broker capacity or dealer capacity and so this one is a good for knowing that a means agent b means a broker and C means Commission so let's remind us that when we're acting in an agency capacity because you've got to disclose capacity right so I say Liz when you open an account at Merrill Lynch uh you know when you give an opening account at Merrill Lynch we are broker dealer in some transaction Merrill Lynch will be acting in its broker agency capacity and charging a commission in another transactions they'll be acting in their dealer principal capacity and charging a markup or a markdown now this is also a good memory aid device for what is an investment advisor so uh we have Investment Advisors you know investment advisors we can use our ABC again but this is for a different memory a device if the firm you know broker dealers get paid do transactions but if it's I tell you on the test it's somebody who gets paid for advice I tell people I'm in the business of giving investment advice there's the a I'm in the business of giving investment advice there's the B and I want compensation a fee a b c I'm an investment advisory firm so this is a memory aid device that works for capacity and it works for determining whether somebody is an investment advisory firm okay so our next memory aid device whoop is action asset amount so this is uh helpful in terms of trying to determine whether or not we need discretionary Authority so if action is whether to buy or sell the security asset is which security to buy or sell an amount is the quantity so the Three A's are present it's an acceptable order right so let's try one buy there's the action where the buyer sell buy action GE there's the asset ten thousand shares that's an acceptable order we do not need to have discretionary authority to make a decision about time and price right so the Three A's is a way to be help us go through a question to answer set and say okay they'll say like for example in the exam maybe which of the following is a discretionary order and you're looking for one that's missing one of the Three A's by the way if it's missing one two or all three the A's it requires discretionary Authority it does not require discretionary authority to make a decision about time and price buy ten thousand tiers of GE today work the order give me some good execution that happens all day long that is not a discretionary order there's a jumbo CD of 100 Grand coming due but I mean whatever utility stocks you think looks good actions there amounts there but not the security can't accept that without discretionary Authority so that's a nice memory aid device for determining discretionary Authority uh again on the test if you can't remember you know how to do the split you know for example if it's a three for two split I take three lots of ways to do it but I take three divided by two and then I times it by whatever the position was and that gives me the you know adjusted price but here I'm just sharing with you that if you can't remember the mechanics of doing a stock split not what we're doing in this video we're just going over memory devices I would like you to be able to shop your answer set and know that it's either going to be more shares at a lower price right so if it's a two for one split I got more shares a low price I know many times and the answer said is your practice Sterling rehearsing just chop your answer set and you can get to a 50 50. if it's a reverse split I'm looking for an answer that has less shares at a higher price so again I'm not going to show you the mechanics of that because that's not what this video is about again I'm just sharing with you some tricks tips tricks and memories this is a trick to get the answer set to one and two and a lot of times you know you don't even have to fire up the the calculator you can just say oh there's only one that offers me more shares at a lower price or there's only one that offers me uh less shares at a higher price if it's a reverse split uh this is just one I've made up to make it make sense so when I say governments are goofy when I say governments are goofy I'm talking about government securities on the test which are treasury notes and t-bonds I just call them goofy because it makes it easier for me to use this uh memory a device the governments are goofy and then you know the test significance is how are they goofy right they're Goofy and that they settle t plus one so a good way to remember this is governments are goofy they're Goofy and that they trade in 30 seconds right they're Goofy and that they use an actual calendar you know remember corporate and municipal bonds use a 30-day month and 360 day calendar and this uses an actual 360 day calendar for calculating accrued interest so uh governments are goofy or just a way to remind myself gummies are goofy they said oh t plus one they trade in 30 seconds whereas corporates amenities are t plus true and trade nates they use an actual calendar not a 30-day calendar 360 day a year calendar but an actual calendar 365. for calculating accrued interest so a good way to remember how governments are goofy is that Guppies are goofy if you remember Guppies are goofy then you can kind of say okay well how are they goofy how are they Goofy a lot of times you can get questions right by covering up the screen or they ask about paper prospectuses 33. 30 degrees the prospectus act so if they're asking about the cooling off period or they're asking me about uh you know tombstones or preliminary prospectuses or you know things like that I say okay cover up the screen this is about paper prospectuses this is 33 is the answer if they're asking about people and places then 34 is the answer no people in places like the SEC was created under 34 or you know exchanges have to register places Market centers like NASDAQ New York need to register with the SEC so people and uh paper and people in place a good way to distinguish between 33 and 34. uh primary versus secondary so you know you're definitely getting questions about is it primary or trans secondary transactions and so what you want to know is where is the money going to do you know the money in a primary transaction uh the issuer is receiving the proceeds so you want to go through the answer set and say okay well if the issuer is receiving the proceeds then it's a primary transaction taking place in the primary Market and if the previous owner is receiving the proceeds and it's a secondary transaction and again you are going to have to distinguish between primary and secondary transactions by the way all the transactions that are previous owners receiving transact receiving proceeds is called the secondary Market and then all the primary transactions together are called the primary market so definitely should be able to determine between primary and secondary Market and the way you do that is by who's receiving the proceeds oh uh one for four so 144 is a good way to remember uh one four four right so on 144 uh we file the form we can sell up to one percent of the outstanding stock or the average of the last four weeks trading volume there's the four one four four whichever is greater let's get down there up to four times a year every 90 days so a good way to remember 144 is one four four we can sell one percent of the outstanding shares or the average the last four weeks trading volume up to four times a year every 90 days so I think that's a good way a good memory aid device for that one four four okay our next one is uh datto15 datto 15 is to help us remember test question the sequence of the events and so D is for disclosure we're going to give you the Disclosure document the characteristics and risks of options and then I'm going to go get your account approved by an ROP and then once your account is approved you can do the first trade and then we have to have back from you the option agreement and we have to have back from you the option agreement within 15 days yeah we don't get that back from you in 15 days we're only going to allow you to do closing transactions closing transactions so again a good way to remember that is datto 15 in terms of that sequence that sequence is testable and so we're just giving you some memory aid devices that you might find helpful make a different color for that remind us this uh chronological sequence other people's money accounts this is to help us remember uh what a clearing firm does and what is necessary to clear a trade other people's monies count opmc and so we'll use this for is to remind ourselves that the order flow the first place an order goes to is the order Department and the order department is going to wire that order to the appropriate exchange or Market Center for execution either you know New York or NASDAQ and once it goes to the order Department the next Department it goes to is the pns department you know pns stands for purchase and sales department and they're going to generate the confirmations and uh have to be in the mail by settlement and settle the trade so that's called purchase and sales because you know our customers that you're buying or selling and then once it goes to the pns Department that only goes to the margin Department who determines whether any monies or Securities are due and then once it goes to the margin Department the last Department that gets it at a brokerage dealer is the cash sharing Department so these are the four departments found in a clearing firm a clearing firm is going to have an order Department it has the ability to transmit or wire orders to the appropriate exchange for the execution has a pns department that can generate confirmations and match trades as a margin Department that cannot determine whether monies or Securities are due and has a cashiering Department that you know collects the monies insecurities that you know fashion is called the cage we cage the Brokers out of that area so again a lot of us don't have these departments we use a clearing firm to provide this back office to us right so this is a good way to do it if you don't like or order peanuts or other people's monies count remind us of opmc another one you can use is order peanuts Mr Carter but this is the flow order flow through a clearing firm to clear a trade right we do the trade then we clear it and this is that process uh derp is to remind us of the chronological order the chronological order of uh dividend the dividend process and you know derp the first thing that happens is the board of directors declares a dividend that's called the declared date and then they say they're going to look at their shareholder list on the record date and if you're a shareholder as of record on that day you're going to get the dividend and then they're going to decide when to pay the dividend and those three dates those three dates are set by the board of directors but remember the X state is a function of the uniform practice code which standardizes secondary Trading and the Securities industry and so that's not set by the board of directors but in chronological order this is a way to remember that chronological sequence the x-day is one business day prior to record one business day prior to record and it's the first date on which the stock no longer trades with the dividend to attached so we're going over memory aid devices and this memory aid device is derp to remind us of the proper chronological sequence in terms of what happens with uh dividends uh die 90 is to remind us how much of a mutual fund uh and a Reit must flow through to the shareholders and the D is for the dividends from the stocks and the mutual fund portfolio plus the interest plus the interest from the bonds in the portfolio minus the expenses whatever that number is the mutual fund re would have to pass through 90 percent of that so there's a good memory a device to remind us that reads and mutual funds must pass through 90 of their net investment income die 90 die 90. uh yield a price so again this isn't a lecture I have a whole lecture on the teeter-totter so an entire 15-minute lecture just on the teeter-totter and I love the teeter-totter or seesaw because it turns uh you know judgment questions in the aim and shoot point-and-click questions as I told you on your Sie it's primarily recognition but the three styles of questions are recognition practical application and judgment judgments are the hardest types of questions you know judgments are like suitability questions uh you're not gonna have to do not much practical application but you should be prepared to do a stock split as I just told you you know three for two and tell me how to do that you should be able to do that mathematically you should be able to do current yield mathematically on your Sie you should be able to use our practical application question you don't want to miss math questions because you know there's no interpretation of the right answer and then you should be able to do tax and tax-free equivalent yields for sure those are all high probability math questions on the Sie you know the rest of it you know you know the Potpourri right but those are high risk anyways you uh do definitely need to know the inverse relationship of interest rates and bond prices you know anybody ever asked about economics Finance or Investments you want to sound smart you should say it has a lot to do with interest rates and so what the Teeter tartar helps us do is see what happens when interest rates go up or down right so I'm not going to lecture you now here on this teeter-totter and how to use it to answer questions I'm just showing you what it looks like for example if interest rates go down you are going to have to be able to Crunch current yield you won't be able to I'm about to show you yield a mature yield a call you don't need to worry about crunching that doesn't matter the relationship but as I'm showing you here the Teeter daughter helps us with this relationship I know if it's Bond at a premium based on the teeter-totter or seesaw the current yield is going to be lower than the nominal yield the yield maturity be lower still and the yield of call will be the lowest and that's the opposite for the discount right and you know again if you tell me you didn't understand yield a price or price to yield relationships based on interest rates and bond prices that inverse relationship and that's why you missed your Sie I'm gonna say why didn't you watch my lecture now I'm going to say I don't think it's a big deal so again in this video we're not trying to lecture you on how to use the teeter-totter there's a separate lecture in the playlist for YouTube if you're interested in that now another great memory aid device is slobs over bliss now I'm mentally lazy and so I don't even put slobs there because I know it isn't a buy limit or a sell stop because those go below the market then it goes above so that's how lazy Dean is right so this is worth some point so this is where we place orders in relationship to the marketplace again this isn't a lecture on types of orders I have a whole hour lecture on that you can watch this is just memory aids to help you remember things you should know or remember on the test recall these are called recall questions now if you want you can also remember slobs and slobs over bless where orders are placed now the O is just to make it a mnemonic but sell limits and buy stops whether you want to buy stop that turns into a market order or a buy stop that turns into limit order is placed above the market and Bliss lobs over Bliss and a memory a device tells us where we place buy limits and sell stop sell stops either get triggered into a market order if they ever do or sells not determines into a limit order those are placed below the market so that one is worth a couple points at least on your Sie exam by the way I would tell you all of these are going to be something when it wants to get tested twice if the second leg of your testing journey is a series 7. options call up put down is really great for options you know call up is a way to remember that if the market price is up from the strike price so now let's just uh right now Apple is a 154. and so uh call up is a nice mnemonic because call up if the market price is up from the strike price the contract has and Transit value so this 150 call has four points of intrinsic value because the market price is up from the strike price call up again this isn't an options lecture I have hours of option lectures no surprise I recommend you watch them particularly the first three right I got three hours of lectures on options for you on the Sie if you tell me you missed the Sie because of options I'm going to say I don't believe you uh however you know there's three or four most of it again is recognitions like when do options expire when do options settle you know uh when do they uh how does the OC see assign exercise notices American Style versus European style that kind of thing but that being said this is also good call up put down for break even break even in a call contract is 150 Plus 8. 158. now that's the same breaking by the way whether you're long or short it's just a matter where you would want Apple in relationship to that so a great mnemonic device for options is call up and put down now let's look over here at a put you know we have two types of contracts calls and puts you can either buy them or sell them so we have four basic positions now here to answer the question about intrinsic value or break even you don't need to know the position because it's the same breaking but if you're long you want it above 158 Apple or short below again this isn't an options lecture now if we look at Apple and apple is uh 144. went down you know the market price is down from the strike price MP means market price what yeah so this contract has six points of intrinsic value uh the break even it would be the 150 minus six 150 minus 6 put down now where you want it would be in relationship to that right you're breaking would be 144. you know you're along the plate you want to blow that short to put so we have two Basics now again this is not an options lecture but again another thing you might find helpful as it relates to options is what I call the options Matrix and I'll leave it to you to you know again go learn how to use the options Matrix but you know the options Matrix not a box with four squares we have two types of contracts calls and puts you can either buy them or sell them so we have four basic positions and again we're talking about memory devices I'll leave it to you to watch the first lecture that I have in the playlist for you for the Sie where it shows you how to develop this Matrix step by step but assuming you have the Matrix and you can data dump it up when you show up or you have in your head I say wait can you tell me about a short put and let's assume you know nothing about options you say Dean when you're short a put you're breaking with a strike Price Less premium you're bullish you receive the premium you have an obligation to buy the stock at the strike price your max gain is the premium your max losses Break Even to zero you might not have any clue what you just said but it's technically correct so I would suggest maybe working on developing your ability to flush out this Matrix not a box with four squares Matrix means every one of these quadrants relates to some other quadrant if you get the long call down by the way you don't have to memorize short coil you just literally could write the opposite and you'd be correct okay so again it's not an options lecture but uh make sure you you know if particularly if you're taking a seven I would tell you that whatever you invest in your study effort on the Sie is going to pay huge dividends on both a six and a seven you know the six there's a lot of overlapping I think you can almost pass out of a six if you do a good job on your Sie there's gonna be a lot less options and then seven you're laying bass that you're going to need in your seven as I just told you there's only three or four questions on options on your Sie and most of recognition by year seven if that's your next leg of your testing Journey that's gonna be 20 give or take five and there's gonna be Advanced options strategies and other things so why not uh pay the price now okay so uh I hope you found that helpful remember inch by inch Sie is a cinch yard by yard s-i-e is hard and I'll see you for the next installment I should have another Sie practice exam depending on when you're watching this uh we Premiere them on Thursdays and there should be another uh practice exam up so there'll be a total of uh five Sie practice exams the finroom one where you can watch me uh literally go through the thinner exam you can hit pause watch me answer and or you answer watch me answer talk about it and then hit play there's a test geek practice final there's a guru practice final that's my social media handle one that I've written there's a Kaplan practice final and I'm about to put up another Kaplan practice file so that would be a total of five okay so uh bonchonami that means good luck my friends uh keep us posted on what happens to you in terms of your testing journey and I'll see you Tuesday for the last stream q a we do that 5 30 Las Vegas time each Tuesday and I'll see you next time in uh in the the YouTube channel bye-bye