One-Page Cheat Sheet

This is the whole book at a glance. It assumes you have already worked through the units; each line is a memory jog, not a first lesson. If a line reminds you that you forgot something, go back to that unit's rapid-fire sheet.

Capital Markets (16%)

• Regulatory Entities and Market Participants: SEC on top, SROs beneath it writing and enforcing, protection corporations backing customers, and a cast of brokers, dealers, advisers, and market makers operating inside the lines. Learn the boundaries and half the exam's regulatory questions answer themselves.
• Market Structure: New securities are born in the primary market, where the issuer collects the proceeds, then live and trade in the secondary market, where the selling investor gets paid. The third and fourth markets are just secondary trading with the venue and intermediary changed: listed securities off-exchange through a dealer, or institution-to-institution through an electronic communication network with no middleman.
• Economic Factors: The Federal Reserve pulls three levers to steer money and rates, the economy cycles through four phases, and indicators tell you whether you're predicting, describing, or confirming. Nail the Fed-to-dollar chain and the gross domestic product versus gross national product split, and the international questions answer themselves.
• Securities Offerings: The issuer picks an investment banker, forms a syndicate, chooses an offering and commitment type, then either registers under the Securities Act of 1933 or claims an exemption. Firm commitment means principal, best efforts means agent, and secondary-offering money goes to sellers. When in doubt, remember the SEC never approves; it only declares registrations effective.

Products & Risks (44%)

• Equity Securities: Common is last-in-line ownership with a vote and unlimited upside; preferred trades the vote for a fixed, first-paid dividend that swings with rates. Rights sell cheap and fast, warrants sit above market for years, convertibles flip to common when it pays, and control and restricted shares wait out a holding period before an affiliate can sell.
• Debt Instruments: Prices and yields see-saw: premiums yield less, discounts yield more, par sits flat with all four yields equal. Treasuries are the safe, state-tax-exempt benchmark; municipals dodge federal tax; corporates are fully taxable and credit-risky. Nail the par values, the investment-grade cutoff, the 270-day money-market maturity line, and who holds the option on callable versus convertible bonds.
• Options: Buyers hold rights and risk only premium; sellers take premium and carry the obligations, with naked calls the one truly unlimited danger. Calls add, puts subtract for breakeven; the Options Clearing Corporation guarantees every contract and the options disclosure document comes first.
• Packaged Products: Three investment-company types, management companies split into open-end and closed-end, unit investment trusts run by a trustee. Buy at the public offering price, redeem at net asset value, forward-priced at the next close. Class A shares get the volume discounts; variable annuities are dual-regulated securities. Know the boundaries and the numbers, and the packaged-products questions fall into place.
• Municipal Fund Securities: Three Municipal Securities Rulemaking Board products, one category: 529 plans for education, Achieving a Better Life Experience accounts for disability, local government investment pools for government cash. The owner controls the 529, penalties hit earnings only, and the tax and guarantee boundaries answer most of the questions.
• Alternative Investments: Direct participation programs pass income and losses through on a K-1; real estate investment trusts distribute 90% to dodge entity tax and pay ordinary-income dividends; hedge funds are private, illiquid, accredited-only pools charging 2 and 20. Nail taxation, liquidity, and eligibility, and the alternative-investment questions answer themselves.
• Exchange-Traded Products: An exchange-traded fund holds securities (tracking error, no credit risk); an exchange-traded note is a bank IOU (no tracking error, credit risk). Both trade like stocks. Passive matches, active beats. Leveraged and inverse products reset daily, so they decay and stay short-term only. Nail the credit-risk line and half these questions answer themselves.
• Investment Risks: Two families of risk: systematic hits everyone, non-systematic hits one name. Diversification erases company risk, rebalancing holds the plan, hedging is your only shield against the market. Know which risk each investment carries and which tool answers it, and the questions solve themselves.

Trading, Accounts and Prohibited Activities (31%)

• Orders and Strategies: Pick the order type for the price control you want, place the trigger on the correct side of the market, know that long risk is capped while short risk is not, read compensation to spot capacity, and match the market outlook to the strategy. Nail those lines and the trading questions answer themselves.
• Investment Returns: Return is income plus capital changes; measure it with current yield, yield to maturity, yield to call, or total return; know that only cash dividends are taxable; nail the declaration-ex-record-payable timeline and the ex-date rule; and remember the Dow Jones Industrial Average is price-weighted while you cannot buy an index directly.
• Trade Settlement and Corporate Actions: Regular way settles T+1, cash settles same day; most shares sit in street name with the customer as beneficial owner; splits are mandatory and value-neutral while tender and rights offerings are voluntary; and the broker forwards every notice but votes only ratification of auditors without instructions.
• Customer Accounts: Pick the account type, gather the right paperwork, confirm who may trade, and match the compensation model to how the customer actually invests. Nail the ownership distinctions and the retirement numbers and the account questions answer themselves.
• AML Compliance: Dirty money in (placement), spin it around (layering), clean money out (integration). Firms answer with an Anti-Money Laundering program, a Customer Identification Program at the door, Suspicious Activity Reports for suspicious activity over $5,000, Currency Transaction Reports for cash over $10,000, both to the Financial Crimes Enforcement Network, and the Office of Foreign Assets Control blocking anyone on the sanctions list. Nail the thresholds and deadlines and this unit answers itself.
• Books, Records, Privacy and Communications: Keep records on the 6-5-4-3 schedule, send confirmations by settlement and statements monthly or quarterly, get a principal to approve anything hitting more than 25 retail investors, respect the never-expiring privacy opt-out, call only during the customer's local 8 AM to 9 PM window, and keep customer assets fully segregated. Nail the numbers and this compliance-heavy unit answers itself.
• Prohibited Activities: Manipulation fakes price or volume, insider trading exploits material nonpublic information, and the broad antifraud rule covers both. Layer on the customer-funds rules, records integrity, senior holds, registration gatekeeping, and initial-public-offering restrictions, then lock in the penalty multiples and the senior-hold day counts, and this heavily tested unit answers itself.

Regulatory Framework (9%)

• Registration and Continuing Education: Registered persons sell and advise; non-registered persons file paperwork. Pass the SIE plus a top-off, file Form U4 through the firm, register in every state, and complete annual Regulatory Element and Firm Element continuing education. Felonies, securities misdemeanors within the past 10 years, and pending indictments slam the door.
• Employee Conduct and Reportable Events: The firm files Form U4 to start and Form U5 within 30 days to end, reports events within 30 days, logs every written complaint at the $5,000 line, notifies before outside business, gets approval before compensated selling away, keeps political gifts to $250 per election, and caps gifts at $300 a year. Deadlines and dollars win the points.

That's the whole exam on one page. If you can read each line and hear the full unit behind it, you're ready.