SIE Exam Question 406: Answer and Explanation

Question: 406

Your client wishes to make a substantial investment in a mutual fund your firm is offering. In order to qualify for a reduced sales load, they sign a letter of intent which gives them:

  • A. a year to comply with the breakpoint level
  • B. 13 months to comply with the breakpoint level
  • C. 90 days to comply with the breakpoint level
  • D. an obligation to comply with the rules regarding breakpoint qualification

Correct Answer: B

Explanation:

B: A letter of intent is not an obligation but rather a show on one's intent to invest an amount equal or more than a mutual fund's breakpoint level so as to qualify for the reduced sales charge. LOI gives 13 months to do so.

All content of site and practice tests © 2022 Jack.
Quick View

FINRA Practice Tests