Ch 1: Advertising & Public Communication in the Securities Industry

About This Chapter

This chapter on advertising and public communication in the financial industry can help you review material related to the various rules on stockbroker communication in order to fully prepare for an exam.

Advertising and Public Communication in the Securities Industry - Chapter Summary

Within this chapter, candidates who are preparing for exams can review information regarding restrictions on advertising and communication, including SEC rules for public communications, advertising, and misleading sales literature . After you have studied this material, you should be able to:

  • Interpret FINRA rules 2211, 2212, and 2213
  • Relate how the Securities Exchange Act of 1934 created the government agency Securities Exchange Commission
  • Define continuing disclosure, and exemptions from continuing disclosure
  • Explain the prohibition on misleading sales literature from investment companies
  • Discuss Municipal Securities Rulemaking Board Rule G-21, including its provisions for professional advertising
  • Analyze product specific advertisements for various securities, including options, government securities, and collateralized mortgage obligations

The lessons contained in this chapter are both interesting and informative, and will help test-takers to master the material that they'll need to know to succeed on the exam. You can use the chapter on any device, which means that you can study wherever you are.

14 Lessons in Chapter 1: Advertising & Public Communication in the Securities Industry
Test your knowledge with a 30-question chapter practice test
Communications With the Public: Types, Standards & FINRA 2210

1. Communications With the Public: Types, Standards & FINRA 2210

Firms involved in the investment industry have to be careful of all their public communications to the public to ensure that the firm and its employees stay in compliance with FINRA rules.

Communications With the Public: Variable Life Insurance & Annuities

2. Communications With the Public: Variable Life Insurance & Annuities

This lesson discusses FINRA Rules 2211 and 2230. These rules outline the conditions that need to be satisfied when communicating with the public regarding variable life insurance, variable annuity, and deferred variable annuity products.

Use of Investment Companies' Rankings in Retail Communications

3. Use of Investment Companies' Rankings in Retail Communications

Many websites, brokerage firms, and rating agencies rank and compare investment companies. A high ranking from a respected analyst can drive sales and gain customers. In this lesson, you will learn the rules investment companies must follow when communicating these rankings to their retail clients.

FINRA Requirements for the Use of Bond Mutual Fund Volatility Ratings

4. FINRA Requirements for the Use of Bond Mutual Fund Volatility Ratings

FINRA oversees all investment brokers and dealers. One of its functions is to make rules regulating broker/dealer activities and behavior. Rule 2213 governs the use of bond mutual fund volatility ratings in public communications.

SEC Rules & Regulations: Public Communication & Advertising

5. SEC Rules & Regulations: Public Communication & Advertising

The Securities Act of 1933 was the first attempt by congress to regulate the buying and selling of securities and the communication about them. Let's explore its major provisions.

Investment Company Advertising: SEC Rules & Regulations

6. Investment Company Advertising: SEC Rules & Regulations

The Securities Act of 1933 is a federal law protecting investors. Rules are established for registering securities with the SEC and against misleading sales advertisements. Rules 156, 482, and 498 are examined.

Securities Exchange Act of 1934: Rules

7. Securities Exchange Act of 1934: Rules

The Securities Exchange Act of 1934 created the Securities and Exchange Commission, a government agency. This lesson explains how the SEC writes rules to protect investors and create confidence in the securities industry.

Continuing Disclosure: Definition, Requirements & Exemptions

8. Continuing Disclosure: Definition, Requirements & Exemptions

In this lesson, we'll review continuing disclosure requirements as outlined in rule 15c2-12 of the Securities Exchange Act of 1934. We'll also review exemptions to the rule.

Misleading Sales Literature & The Investment Company Act of 1940

9. Misleading Sales Literature & The Investment Company Act of 1940

The Investment Company Act of 1940 was passed to provide protection for investors purchasing mutual funds. Rule 34b-1 defines regulations for misleading sales literature for securities. Learn more in this lesson.

MSRB Rule G-21: Definition, Purpose & Overview

10. MSRB Rule G-21: Definition, Purpose & Overview

The Municipal Securities Rule Board (MSRB) Rule G-21 was enacted to promote fair dealing and 'good faith' by dealers selling municipal securities. Its definition, purpose, and an overview are discussed.

Financial Options-Related Communications & Disclosures in Advertising

11. Financial Options-Related Communications & Disclosures in Advertising

This lesson briefly describes basic concepts of options and then goes into detail about the options disclosure document and requirements for setting up options accounts and communicating with clients. An opening scenario also provides an example of why it is important to follow these rules.

Advertisements for Municipal & Government Securities: Regulations & Disclosures

12. Advertisements for Municipal & Government Securities: Regulations & Disclosures

This lessons covers regulation of municipal government securities and other rules put in effect to protect a customer's investment assets. We'll cover SEC Rule 15c2-12 and 15c3-3 (Customer Protection Rule).

Collateralized Mortgage Obligations: Advertisements & Disclosures

13. Collateralized Mortgage Obligations: Advertisements & Disclosures

This lesson covers the advertisement and communication of information to investors regarding collateralized mortgage obligations. Specifically, FINRA Rule 2216 is discussed.

Equity & Debt Research Reports: Publication & Distribution

14. Equity & Debt Research Reports: Publication & Distribution

To protect investors from misleading, biased, or deceptive information, there are rules governing the creation and distribution of equity and debt research. In this lesson, learn about those rules and how they apply to investment professionals.

Chapter Practice Exam
Test your knowledge of this chapter with a 30 question practice chapter exam.
Not Taken
Practice Final Exam
Test your knowledge of the entire course with a 50 question practice final exam.
Not Taken

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