Series 30 - Additional Questions

An AP may share in an account with a customer if she has written authorization from the customer and the firm gives its approval.

True

False

If a complaint is served, the respondent will receive written notification from the Business Conduct Committee. How many days does a respondent have to file an answer to the charges?

You are not permitted to have an attorney represent you at a Business Conduct Committee hearings.

True

False

If a firm hires APs from a firm that was closed due to violations of sales practice rules, special training and supervision of the APs may be required.

True

False

A spread could be defined as

The purchase of one futures contract and the sale of another futures contract for commodities that are different but that can be used interchangeably

The purchase of one futures contract and the sale of another futures contract on the same exchange, but in different delivery months

The purchase of one futures contract and the sale of another futures contract on two different exchanges

All of the above are examples of spreads

The term "basis" is the difference between the cash price and the futures price.

True

False

When a person buys or sells a futures contract, the person is liable for :

Only the original margin

Not more than 70% of the cash value

The full value of the contract

None of the above

A trader has a long futures position that he wants to offset. This means that:

He will sell futures to match a purchase of the cash commodity

He will buy futures because he is short the cash commodity and he anticipates that he will buy cash at a later date

He will sell futures on the same exchange in the same delivery month

He will buy futures because he anticipates a price decline

A futures market hedge is

Established only when prices are expected to move in the direction of the hedge

A temporary substitute for a later cash market transaction

Always placed in the nearby futures contract

All of the above

Which of the following is NOT considered to be part of carrying charges

Storage costs

Interest

Transportation

Insurance

A large amount of speculators in a futures market:

Eliminates price fluctuations in the cash market

Has no effect on fluctuations in the cash market

Tends to reduce the magnitude of price fluctuations

Tends to reduce frequency of price fluctuations

New APs should recommend spread positions because they are less risky than simple "outright" long or short positions.

True

False

According to Rule 2-30, the "Know your Customer rule", if a customer refuses to disclose required information, an account may be opened if the customer's refusal is noted and the account is approved by the branch office manager. Such a record need not be made in the case of a non-US customer.

True

False

A pool that invests only in foreign futures and options is exempt from registration.

True

False

An NFA member who does not pay an arbitration award within 30 days is subject to suspension and may not engage in business with other members until the award is paid.

True

False

Series 30 - Additional Questions

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