Discuss Finra Series-6 Exam Topic 9 Question 77

Which of the following is exempt from registering as an investment company under the Investment Company Act of 1940?

Aa unit investment trust

Ba non-diversified mutual fund

Ca company that sells its securities only to accredited investors

Da company that has no sales charges or management fees

Suggested Answer: A

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30 comments · newest first

Milly 11 months ago

A unit investment trust is also exempt, right?

Candra 11 months ago

Wait, are you sure about C? Seems too good to be true!

Glenna 12 months ago

Definitely C! Makes sense for private placements.

Erasmo 12 months ago

I thought D could be exempt too, but I guess not.

Fernanda 1 year ago

C is the right answer! Accredited investors are key.

Cordelia 1 year ago

I remember that unit investment trusts have some different rules, but I can't recall if they're exempt or not.

Teresita 1 year ago

I’m leaning towards option C, but I’m a bit confused about the specifics of the exemptions under the Investment Company Act.

Brinda 1 year ago

I feel like we practiced a question similar to this in class, and I think it was about accredited investors being exempt.

Eric 1 year ago

I think I remember that certain companies can be exempt, but I'm not sure which one it is.

Karol 1 year ago

Okay, I've got a strategy - I'll eliminate the options that don't match the key exemptions I know about, then choose the best fit from the remaining choices.

Angelo 1 year ago

Hmm, I'm a bit unsure about this one. The wording seems a bit technical, so I'll need to think it through step-by-step.

Eun 1 year ago

This looks like a tricky question about investment company exemptions. I'll need to carefully review the key criteria for each option.

Marge 1 year ago

I'm pretty confident I know the right answer here. Unit investment trusts are a common exemption, so I'll go with that.

Gearldine 1 year ago

This looks like a question about event correlation rules. I'll need to think about the different rule types and how they handle multiple events.

Kristel 1 year ago

I'm a bit confused by the second statement about every feature or tool having a separate IPS incorporation. I'm not sure if that's accurate or not. I'll have to think about that one.

Caren 1 year ago

I'm torn between enabling sticky MAC addressing and some kind of auto MAC address learning—need to double-check which phrasing they're using here!

Ming 1 year ago

Hmm, this is tricky. I know AES has different key and block size options, but I'm not totally confident which ones are valid. I'll have to think this through carefully.

Haydee 1 year ago

I'm feeling pretty confident about C. Those accredited investors can handle themselves, no need for extra registration. Although, I do wonder if they get any special perks, like free doughnuts or something.

Gregoria 1 year ago

Definitely not B. A non-diversified mutual fund would need to register, right? I'm going with C on this one.

Louann 1 year ago

Hmm, I'm not so sure about that. Isn't a unit investment trust also exempt? I better double-check the details on that one.

Dwight 1 year ago

↳ replying to Louann

C) a company that sells its securities only to accredited investors

Carma 1 year ago

↳ replying to Louann

B) a non-diversified mutual fund

Van 1 year ago

↳ replying to Louann

A) a unit investment trust

Johnetta 1 year ago

I think the answer is C. A company that sells its securities only to accredited investors is exempt from registering as an investment company.

Queen 1 year ago

↳ replying to Johnetta

So, what about the other options? Are they required to register under the Investment Company Act of 1940?

Marylyn 1 year ago

↳ replying to Johnetta

That's correct! Accredited investors are considered sophisticated and can handle the risks associated with unregistered securities.

Quentin 1 year ago

↳ replying to Johnetta

I think the answer is C. A company that sells its securities only to accredited investors is exempt from registering as an investment company.

Cruz 2 years ago

I'm not sure about that. I think the answer might be D) a company that has no sales charges or management fees. That would make sense for exemption.

Kizzy 2 years ago

I agree with Laurene. A company that sells only to accredited investors is exempt because they are considered sophisticated investors.

Laurene 2 years ago

I think the answer is C) a company that sells its securities only to accredited investors.

Finra Series-6 Exam - Topic 9 Question 77 Discussion