Series 63 practice questionmediumExempt Securities - Isolated Transaction Exemption (Scenario)
A resident of State M sells shares of a privately held corporation in a single transaction to a friend. According to the USA, this transaction is:
- AExempt as an isolated non-issuer transaction✓ Correct answer
- BNon-exempt and requires registration
- CExempt only if the corporation is a bank
- DExempt only if the security is federally covered
Explanation
Why A — Exempt as an isolated non-issuer transaction
A one-time, private sale (non-issuer, not in the course of repeated transactions) is exempt under USA Section 402(b)(1) as an isolated transaction. Issuer type and federal coverage are irrelevant here.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 1,051+ Series 63 questions, weak-area tracking, and timed mock exams. No credit card, no paywall.
Spot an error in this question or explanation? Tell us — we fix these fast.
Related Regulation of Securities & Issuers questions
- Which of the following Canadian securities is NOT exempt under the USA solely because of the identity of its issuer?
- A registration statement filed by notification becomes effective:
- Which of the following best distinguishes an exempt security from an exempt transaction under the Uniform Securities…
- An agent offers shares of a company listed on the NASDAQ Stock Market to a client in State X. Which statement is TRUE…
- Which security is federal covered specifically because it is listed on a national securities exchange?
- A religious organization in State Z issues bonds to fund construction of a new church. Under the USA, these bonds are:
- A client is offered bonds issued by a state-chartered bank located in another state. Under the USA, the bonds are:
- An agent in State Y is asked to sell bonds issued by a savings and loan association regulated by federal authorities.…