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Exam Series 63 All Questions

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Exam Series 63 topic 1 question 40 discussion

Actual exam question from FINRA's Series 63
Question #: 40
Topic #: 1
[All Series 63 Questions]

Which of the following is not a security, as defined by the Uniform Securities Act?

I. an option contract -

II. a futures contract on gold -

III. a 401K plan -

IV. a variable annuity -

  • A. None of the selections listed are securities.
  • B. Only Selection III is not a security.
  • C. Only Selections II and III are not securities.
  • D. Selections II, III and IV are not securities.
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Suggested Answer: C 🗳️
Only Selections II and III are not securities. Neither retirement plans nor commodity futures contracts are deemed to be securities by the Uniform
Securities Act. A 401K plan may be invested in securities, but it is not a security itself. A gold futures contract is a contract between two parties for the delivery of the underlying asset, gold. The profits (or losses) are not dependent on the performance of an outside party, which is a critical element, based on a 1946 U.S.
Supreme Court decision, which defines a security as "an investment of money. . . with profits to come solely from the efforts of others."
by lolojepu at April 6, 2025, 1:37 a.m.

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