Series65 Exam Format | Series65 Course Contents | Series65 Course Outline | Series65 Exam Syllabus | Series65 Exam Objectives

Exam Code: Series65
Exam Name: Uniform Investment Adviser Law
Vendor: NASAA

I. Economic Factors and Business Information 15%

- Basic Economic Concepts
- business cycles
- monetary and fiscal policies
- global factors
- currency valuation and effective exchange rates
- sovereign debt
- geopolitical
- inflation/deflation
- interest rates- yield curves- credit spreads
- economic indicators
- Gross Domestic Product (GDP)
- employment indicators
- trade deficit
- Consumer Price Index (CPI)

- Financial Reporting

- financial reports
- income statement
- balance sheet
- statement of cash flow
- auditor disclosures (qualified vs unqualified)
- corporate SEC filings
- annual reports
- Accounting Fundamentals
- audited v. unaudited
- cash v. accrual accounting
- Analytical Methods
- time value of money concepts
- internal rate of return (IRR)
- net present value (NPV)
- future value (FV)
- descriptive statistics (e.g.- mean; median; mode; range; standard deviation; Alpha- Beta- and Sharpe ratios; correlation)
- financial ratio interpretation and calculation
- current ratio
- quick ratio
- debt-to-equity ratio
- valuation factors- interpretation and calculation
- price-to-earnings
- price-to-book
- Types of Risk
- systematic risks (e.g.- interest rate risk- sector risk- geopolitical risk)
- unsystematic risks (e.g.- credit risk- legal/regulatory risk- financial risk- issuer specific risk)
- opportunity cost
- capital structure including liquidation priority (e.g.- debt- preferred stock- common stock)

II. Investment Vehicle Characteristics 25%

- Types and Characteristics of Cash and Cash Equivalents
- insured deposits
- demand deposits
- certificates of deposit
- money market instruments
- commercial paper
- Treasury bills
- Types of Fixed Income Securities
- U.S. government securities
- Treasury securities (e.g.- Bills- Notes- Bonds)
- Treasury Inflation-Protected Securities (TIPS)
- asset-backed securities
- corporate bonds
- municipal bonds
- general obligation
- revenue
- insured
- tax implications
- foreign-issued bonds
- government/sovereign debt
- corporate debt
- Characteristics and Valuation Factors of Fixed Income Securities
- fixed income characteristics
- tax implications
- bond ratings
- market liquidity
- liquidation preference (e.g.- debt- preferred stock)
- call features
- coupon v. zero coupon
- duration
- pricing (par- premium- or discount)
- risk
- yield
- fixed income valuation factors
- duration
- maturity
- yield to call
- yield to maturity
- coupon
- conversion valuation
- bond ratings
- credit spread
- discounted cash flow
- Types of Equity Securities
- common stock (domestic- foreign- American Depositary Receipt (ADR))
- preferred- convertible preferred stock- floating rate preferred
- Characteristics of Equity Securities
- shareholder rights
- voting rights
- antidilution (preemptive right)
- liquidation preferences
- restricted stock and resale restrictions
- dividends
- employee stock options
- incentive
- nonqualified
- Methods Used to Determine the Value of Equity Securities
- technical analysis
- fundamental analysis
- dividend discount
- discounted cash flow
- Equity Public Offering
- initial public offering (IPO)
- secondary offering
- special purpose acquisition companies (SPAC)/blind pools/blank check
- Types of Pooled Investments
- mutual funds
- open-end
- closed-end
- private funds
- hedge funds
- private equity
- venture capital
- unit investment trusts (UITs)
- exchange traded funds (ETFs)
- real estate investment trusts (REITs) (liquid and non-liquid)
- Characteristics of Pooled Investments
- share classes
- liquidity
- tax implications
- fee structures and other costs
- pricing
- net asset value
- discount/premium (e.g.- ETFs- closed-end funds)
- benefits and risks
- relative comparisons
- benchmarks
- manager tenure
- change in investment policy
- style
- Types of Derivative Securities
- options and warrants (definitions)
- futures (definitions)
- Characteristics of Derivative Securities
- costs- benefits- and risks of derivative securities
- Alternative Investments
- limited partnerships
- exchange traded notes
- leveraged funds
- inverse funds
- structured products
- Insured-Based Products
- annuities (definitions)
- variable annuities
- fixed annuities
- indexed annuities
- life insurance (definitions)
- whole
- term
- universal
- variable
- Other Assets
- commodities and precious metals
- Digital assets (definition) (distinction- characteristics- and risks- securities- currencies- and assets)

III. Client Investment Recommendations and Strategies 30%

- Type of Client
- individual- natural person(s)- sole proprietorship
- business entities
- general partnership
- limited partnership
- limited liability company (LLC)
- C and S-corporations
- trusts and estates
- foundations and charities
- Client Profile
- financial goals and objectives
- current and future financial situation
- cash flow
- balance sheet
- existing investments
- tax situation
- social security and pensions
- risk tolerance
- nonfinancial investment considerations (e.g.- values including environmental- social- governance- and religious criteria; experience; life events; life stage; behavioral finance)
- client data gathering (e.g.- client identification; questionnaires; interviews)
- time horizon.
- Capital Market Theory
- investment theories- models- and hypotheses
- Capital Asset Pricing Model (CAPM)
- Modern Portfolio Theory
- Efficient Market Hypothesis
- Portfolio Management Strategies- Styles and Techniques
- strategies
- strategic asset allocation
- tactical asset allocation
- styles
- active
- passive
- growth
- value
- income
- capital appreciation
- techniques
- diversification
- sector rotation
- dollar-cost averaging
- purchasing or selling options
- leveraging
- volatility management
- inverse strategies
- high frequency trading
- Tax Considerations
- income tax fundamentals: individual
- capital gains
- qualified dividends
- tax basis
- marginal bracket
- alternative minimum tax
- pension and retirement plan distributions (e.g.- required minimum distributions (RMD))
- government benefit implications (definition) (e.g.- income related monthly adjustment amounts (IRMAA))
- income tax fundamentals: corporate (C vs S)- trusts- passthrough entities (REIT- MLP- LLC)
- wealth transfer: estate tax and gift tax fundamentals (e.g.- exemptions; unified credit; annual vs lifetime; portability)
- Retirement Plans
- Individual Retirement Accounts (traditional and Roth)
- Solo 401(k) (traditional and Roth)
- qualified retirement plans (e.g.- defined benefit and defined contribution plans; company 401(k); 403(b) plan; 457 plan; SIMPLE IRA; SEP)
- nonqualified retirement plans
- ERISA Issues
- fiduciary issues
- investment- qualified default investment alternative (QDIA)- and diversification choices
- investment policy statement
- prohibited transactions
- Special Types of Accounts
- education-related
- 529s
- Coverdell IRA
- Uniform Transfers to Minors Act (UTMA)/Uniform Gift to Minors Act (UGMA)
- health-savings accounts (HSA)
- Ownership and Estate Planning Techniques
- types of ownership (joint tenants with rights of survivorship (JTWROS); tenants in common (TIC); tenancy by the entirety (TBE)- community property with rights of survivorship (CPWROS))
- joint tenants with rights of survivorship (JTWROS)
- tenants in common (TIC)
- tenancy by the entirety (TBE)
- transfer-on-death (TOD)/pay-on-death (POD)
- beneficiary designation including per stirpes
- trusts and wills (basic concepts)
- qualified domestic relations order (QDROs)
- donor advised funds
- Trading Securities
- terminology
- bids
- offers
- market- limit- or stop order
- short sale
- cash accounts
- margin accounts
- principal or agency trades
- payment for order flow
- role of introducing broker-dealers- clearing broker-dealers/custodians- market makers- and exchanges
- costs of trading securities
- commissions
- markups
- spread
-best execution
- Portfolio Performance Measures
- returns (e.g.- risk-adjusted; time-weighted; dollar-weighted; annualized; total; indexed; holding period; internal rate of return (IRR); expected; inflation-adjusted; after tax)
- risk-adjusted
- time-weighted
- dollar-weighted
- annualized
- total
- holding period
- internal rate of return (IRR)
- expected
- inflation-adjusted
- after tax
- current yield
- relevant benchmarks

IV. Laws- Regulations- and Guidelines Including Prohibition on Unethical Business Practices 30%

- Regulation of Investment Advisers- Including State-Registered and Federal Covered Advisers
- definitions of Investment Advisers (e.g.- Investment Adviser- Exempt Reporting Adviser)
- notice filing requirements
- registration/post-registration
- books and records requirements
- registration maintenance requirements (e.g.- update uniform forms- continuing education requirements for IARs)
- Investment Adviser Representative supervision
- Regulation of Investment Adviser Representatives
- definition of an Investment Adviser Representative
- registration/post-registration
- activities requiring registration- exclusions from registration- and registration authority
- registration maintenance requirements (e.g.- update uniform forms- continuing education requirements- disclosure of reportable events)
- Regulation of Broker-Dealers
- definitions of Broker-Dealers
- Regulation of Agents of Broker-Dealers
- definition of an Agent of a Broker-Dealer
- Regulation of Securities and Issuers
- securities
- definitions
- state registration requirements/post-registration requirements
- exemptions and exclusions from registration (basic concepts)
- issuers
- definition
- registration of issuer Agents
- finders
- state enforcement and antifraud authority
- Remedies and Administrative Provisions
- authority of state securities Administrator
- administrative actions
- other penalties and liabilities
- Communication with Clients and Prospects
- required disclosures to clients
- unlawful representations concerning registrations
- performance guarantees prohibition
- client contracts
- correspondence and advertising
- social media
- email/digital messaging
- website and internet communications
- Ethical Practices and Fiduciary Obligations
- compensation
- fees
- commissions
- performance based fees
- soft dollars
- disclosure of compensation
- client funds and securities
- custody
- discretion
- trading authorization
- recommendation/advice to client standard of care
- anti-money laundering (AML)
- custody definition and obligations
- conflicts of interest- impermissible activities- fiduciary and other ethics issues
- loans to and from customers
- sharing in profits and losses in a customer account
- client confidentiality
- insider trading
- selling away
- market manipulation
- personal securities transactions
- outside securities accounts
- initial holdings and quarterly reports
- political contribution
- excessive trading
- exploitation of vulnerable adults
- other prohibited activities
- cyber security- privacy- and data protection.
- business continuity plan
- disaster recovery
- succession planning