Series 7 practice questioneasyMargin Accounts — Regulation T
Which of the following securities CANNOT be purchased on margin?
- ANYSE-listed stocks
- BU.S. Treasury bonds
- CNew issue securities during the first 30 days✓ Correct answer
- DS&P 500 ETFs
Explanation
Why C — New issue securities during the first 30 days
New issue securities (IPOs) cannot be purchased on margin during the first 30 days after issuance. Other non-marginable securities include options (premiums must be paid in full), OTC stocks not on the Federal Reserve's approved list, and mutual fund shares purchased within 30 days. NYSE-listed stocks, Treasury securities, and established ETFs are generally marginable.
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