Finra Series-6 Exam - Topic 3 Question 102 Discussion

Actual exam question for Finra's Series-6 exam

Question #: 102
Topic #: 3

Which of the following statements regarding a letter of intent is true?

AAn investor has 12 months in which to invest the amount stipulated in the letter.

BReinvested dividends and capital gain distributions count toward the amount stipulated in the letter of intent.

CAn investor who signs a letter of intent and does not invest the amount stipulated must make up the difference between the sales charge he paid and what he should have paid, plus interest.

DA letter of intent may be backdated up to 90 days so that any purchases made during that prior time period will count toward making a breakpoint.

Show Suggested Answer

Suggested Answer: D

The true statement is that a letter of intent may be backdated up to 90 days so that any purchases made during that prior time period will count toward making a breakpoint. An investor has 13 months in which to invest the amount stipulated in the letter. The invested funds must consist of new money; reinvested dividends and capital gain distributions don't count. If the amount stipulated in the letter of intent is not invested during the 13 months, the investor must only make up the difference between the sales charge he paid and what he should have paid, given that he didn't qualify for the breakpoint. No interest is charged on the difference.

by Loreen at Jun 12, 2025, 09:25 PM

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Josefa

5 months ago

Wait, really? I thought it was only for future investments.

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Lavina

5 months ago

Totally agree, that’s a great way to maximize benefits.

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Antione

5 months ago

A letter of intent can be backdated up to 90 days!

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Pearly

6 months ago

Not sure about that reinvested dividends part, seems off.

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Rueben

6 months ago

An investor has 12 months to invest the stipulated amount.

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Gaynell

6 months ago

I’m a bit confused about option A; I thought the time frame for investing was flexible, but I can't remember the exact details.

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Nikita

6 months ago

I practiced a question similar to this, and I recall that reinvested dividends do not usually count toward the investment amount, which makes me lean away from option B.

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Rodney

7 months ago

I'm not entirely sure, but I feel like option C might be correct since it mentions making up the difference in sales charges.

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Emerson

7 months ago

I think option D sounds familiar because I remember something about backdating letters of intent to help with breakpoints.

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Audry

7 months ago

This is a good opportunity to apply the concepts we've been learning about letters of intent. I'll use the process of elimination to narrow down the options and identify the correct statement.

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Leota

7 months ago

I'm a bit confused by the wording in some of these options. I'll need to re-read them a couple times to make sure I'm not misinterpreting anything.

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Veronika

7 months ago

I'm feeling pretty confident about this one. The key is to focus on the specific details in each option and identify which one is the most accurate statement about a letter of intent.

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Roosevelt

8 months ago

Okay, let me think this through step-by-step. I want to make sure I don't miss any important details in the wording of these statements.

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Timmy

8 months ago

Hmm, this question seems a bit tricky. I'll need to carefully read through the options to make sure I understand the key differences.

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Erasmo

10 months ago

Wow, these letters of intent sound like a real minefield. I'm just going to stick to index funds and avoid the headache.

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Domonique

8 months ago

B) Reinvested dividends and capital gain distributions count toward the amount stipulated in the letter of intent.

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Felicia

8 months ago

A) An investor has 12 months in which to invest the amount stipulated in the letter.

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Cecily

8 months ago

B) Reinvested dividends and capital gain distributions count toward the amount stipulated in the letter of intent.

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Alesia

9 months ago

A) An investor has 12 months in which to invest the amount stipulated in the letter.

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Hortencia

10 months ago

This is a tricky one, but I think B) is the way to go. Counting reinvested dividends towards the letter of intent makes the most sense.

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Cruz

10 months ago

I think so too, reinvested dividends should definitely count towards the letter of intent.

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Odelia

10 months ago

I agree, B) seems like the most logical choice.

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Natalie

11 months ago

A) 12 months to invest the full amount? That's a pretty generous timeline. Might as well go for it!

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Malika

11 months ago

But C makes more sense because it ensures the investor pays the correct sales charge.

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Barabara

11 months ago

C) Ouch, that's a harsh penalty for not meeting the letter of intent. I'd be sure to do my homework before signing one of those.

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Micah

10 months ago

User 3: I agree, always better to be informed and avoid any surprises later on.

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Cassi

10 months ago

User 2: Definitely, it's important to understand all the terms before signing anything.

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An

10 months ago

User 1: Yeah, that penalty for not meeting the letter of intent is no joke.

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Emelda

11 months ago

D) Definitely the correct answer. Backdating the letter of intent up to 90 days is a great way to maximize your investment and take advantage of those breakpoints.

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