Series 66 Podcast Episode 2 Investment Vehicles

   • Taking your Series 66 Exam?  FREE Series 6...   2.2 Investment Vehicle Characteristics Seventeen questions in every Series 66 examination (17%) will test features or characteristics or various types of investment vehicles. These seventeen questions will cover the following twelve components: (1) Types and Characteristics of Cash and Cash Equivalents o Insured deposits (e.g., demand deposits, certificates of deposit) o Money market instruments (e.g., commercial paper, Treasury bills) (2) Valuation Factors of Fixed Income Securities o Characteristics (e.g., tax implications, market liquidity, liquidation preference, call features, coupon vs. zero coupon, duration, premium) o Fixed income valuation factors (e.g., maturity, yield-to-call, yield-to-maturity, conversion valuation, bond ratings, credit spread, discounted cash flow) (3) Types of Equity Securities o Common stock, domestic and foreign o Preferred and convertible preferred stock (4) Valuation Factors of Equity Securities o Technical analysis o Fundamental analysis o Dividend discount o Discounted cash flow (5) Characteristics of Equity Securities o Shareholder rights (e.g., voting rights, antidilution, liquidation preferences) o Restricted Stock and resale restrictions o Dividends o Employee stock options (e.g., incentive, nonqualified) (6) Equity Public Offering o Initial public offering (IPO o Secondary offering o SPAC/blind pools/blank check (7) Types of Pooled Investments o Mutual funds (open-end vs. closed-end) o Private funds (e.g., hedge funds, private equity funds, venture capital funds) o Unit investment trusts (“UITs”) o Exchange-traded funds (“ETFs”) o Real estate investment trusts (“REITs) (including exchange listed and nontraded REITs) (8) Characteristics of Pooled Investments o Share classes o Liquidity o Tax implications o Fee structures and other costs (e.g., load vs. no-load funds, contingent deferred sales charges, Rule 12b-1 fees, breakpoints) o Pricing (e.g., net asset value (“NAV”), discount/premium) o Benefits and risks o Relative comparisons (e.g., benchmarks, manager tenure, securities indexes) (9) Futures and Options o Definitions, uses, costs, benefits and risks (10) Characteristics, Risks, and Application of Alternative Investments o Exchange traded notes (“ETNs”) o Leveraged funds o Inverse funds o Structured products (11) Insurance Based Products o Annuities (e.g., fixed, variable, equity indexed) o Life insurance (e.g., whole, term, universal, variable) (12) Other assets o Commodities and precious metals o Digital assets (e.g., definition, distinction, characteristics, risks