Series 79 practice questionmediumRule 144
What is a requirement for the manner of sale under Rule 144 for affiliates selling equity securities?
- ASales must be reported to the SEC daily
- BSales must occur in private placements only
- CAll sales must be made at a fixed price
- DRoutine broker transactions or direct sales to market makers✓ Correct answer
Explanation
Why D — Routine broker transactions or direct sales to market makers
Rule 144 requires affiliates to sell in routine trading transactions, such as through brokers or market makers, to prevent market manipulation. Private placements or fixed pricing are not required, and daily SEC reports are not mandated for each sale.
Turn it into reps
Reading one answer is not the same as being ready
Lucky the Banker is a free practice app with 995+ Series 79 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 Underwriting & New Financing questions
- During an IPO, what is the primary purpose of the 'book-building' process?
- An affiliate of a reporting company wants to sell restricted securities under Rule 144. Which volume limitation applies?
- Which of the following actions best demonstrates an underwriter's due diligence in a public offering?
- A company files a shelf registration for common stock. When executing a takedown, which advantage does this structure…
- A company wishes to use Form S-3 for a primary offering. Which of the following would disqualify it from S-3…
- Under Rule 506(c) of Regulation D, which is a requirement for issuers when selling to accredited investors?
- A research analyst participates in due diligence meetings for a follow-on offering. What is the main regulatory risk if…
- Which of the following must be included in a preliminary prospectus ('red herring')?