Glossary Clusters

Economic fundamentals including business cycles, fiscal and monetary policy, GDP, and inflation

Investment company types: mutual funds, ETFs, closed-end funds, and NAV mechanics

Mutual fund fees and expenses: 12b-1 fees, expense ratios, and sales loads

Quantitative measures of risk and return: alpha, beta, standard deviation, Sharpe ratio, and correlation

Portfolio construction principles: asset allocation, diversification, rebalancing, and modern portfolio theory

Key regulators: SEC, FINRA, and NASAA - their roles and jurisdiction

Investment adviser registration requirements: Form ADV, brochure rule, IAR definition, and state vs. federal registration

Fiduciary duties and suitability standards: best interest, disclosure, and client-first principles

Violations and unethical conduct: churning, front-running, insider trading, and market manipulation

Investor categories and qualification criteria: accredited investors, qualified clients, and institutional investors

Securities order types and execution rules: market orders, limit orders, stop orders, stop-limit orders, and time-in-force instructions (GTC, day orders, FOK, AON)

Adviser compensation structures and conflict management: advisory fees, commissions, markups/markdowns, soft dollars, referral fees, performance fees, and breakpoint rules

State vs federal jurisdictional rules: federal covered securities, blue sky laws, registration methods (coordination, qualification, filing), and investor qualification criteria

Bond valuation, pricing, and yield calculations: coupon rate, current yield, yield to maturity, duration, accrued interest, premium/discount bonds, and call provisions

Tax strategies and rules: wash sale rule, cost basis, holding period, capital gains taxation, qualified dividends, AMT, tax-deferred vs tax-free accounts, and step-up in basis

Securities and investment vehicles: stocks, bonds, mutual funds, ETFs, REITs, annuities, options, preferred stock, ADRs, and UITs

Stock market capitalization categories and classifications: large-cap, mid-cap, small-cap, micro-cap, blue chip, penny stocks, growth stocks, and value stocks

Options fundamentals: strike price, premium, in-the-money/out-of-the-money, exercise, assignment, and American vs European options

Financial statement ratios and valuation measures: EPS, P/E ratio, P/B ratio, dividend yield, book value, market cap, payout ratio, current ratio, debt-to-equity, and ROE

Account ownership structures and registration types: UGMA/UTMA, JTWROS, tenants in common, TOD, trust accounts, margin accounts, cash accounts, and community property

Qualified retirement plans and tax-advantaged accounts: Traditional IRA, Roth IRA, 401(k), 529 plans, and required minimum distributions

Common options trading strategies: covered calls, protective puts, and other hedging/income techniques

Federal Reserve tools for controlling money supply and interest rates: open market operations, reserve requirements, discount rate, federal funds rate, prime rate, quantitative easing, and Fed balance sheet

Client profile factors for suitability determination: investment objectives, risk tolerance, time horizon, know your customer (KYC) requirements, and suitability standards

Portfolio oversight and operational strategies: strategic and tactical asset allocation, rebalancing thresholds, portfolio turnover, liquidity needs, and ongoing management techniques

Specific adviser responsibilities and operational requirements: fiduciary duty, best execution, custody rules, discretionary authority, and principal transactions

Fundamental trading concepts: long and short positions, bid-ask spread, market makers, trading volume, settlement dates, and trade execution

Advanced tax planning techniques: tax loss harvesting, Roth conversions, tax-efficient investing, asset location, charitable giving strategies, kiddie tax, and step-up in basis