Chapter 5

Underwriting Securities


Bullet Understanding the specifics of registering securities

Bullet Knowing the types of offerings

Bullet Spotting exempt securities

All issuers of securities need a starting point, just as all securities need a birth date (just not the kind that’s celebrated with funny-looking hats and a cake). Most securities go through a registration procedure before the public can buy them. The Series 7 exam tests your ability to recognize the players and institutions involved in the registration process.

In this chapter, I cover topics related to bringing new issues (securities) to market. You find out about key players, types of security offerings, kinds of securities that don’t need to be registered, and other details about the underwriting process. This chapter also includes a few practice questions to help you measure how well you understand the topic. You'll also notice that there's an overlap of information tested on the Series 7 and what you learned when taking the Securities industry Essentials.

Bringing New Issues to the Market

A lot of things need to happen before securities hit the market. Not only do the securities have to be registered, but the issuer ...

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