SERIES 66 EXAM HAS QUESTIONS ON VALUING FIXED INCOME SECURITIES
In order to take the Series 66 exam, you must either have passed the Series 7 or else you plan to sit for it shortly. Some of the material asked on the Series 66 duplicates material in the Series 7. However, a candidate for the Series 66 may be a bit rusty on some of these Series 7 subjects. But here they are again—for example, how to value bonds and fixed income securities. Under Section II of the Content Outline entitled Investment Vehicle Characteristics for the Series 66, there are 20 questions, of which five are on fixed income securities. Included in the material for these five questions is "conversion valuation," referring to convertible bonds. So, do you know the difference between conversion ratio and conversion price? Suppose the Series 66 asks for the difference between parity price and conversion price. Do you know the meaning of these terms and how they differ one from the other? Lastly, suppose the Series 66 asks about parity price of the bond. How...