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SIE.1.B.1 FINRA · SIE

Market participants — issuers, BDs, RIAs, institutional investors

Node 2 of 13 in SIE

Objectives

  • Identify the key rules and §§ that apply to market participants — issuers, bds, rias, institutional investors.
  • Apply the SIE.1.B.1 knowledge element in a typical exam scenario.
  • Recognize common distractors and partial-credit answers.

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SIE.1.B.1

Market participants — issuers, BDs, RIAs, institutional investors

SIE · Section 1 — Knowledge of Capital Markets 1.B · Market Participants

**Issuers** — corporations, municipalities, and the US Treasury that sell securities to raise capital. Under the '33 Act an issuer must register a public offering unless exempt (Reg A+, Reg D, intrastate 3(a)(11), municipal 3(a)(2), commercial paper 3(a)(3)).

**Broker-dealers (BDs)** — firms that (a) effect transactions on behalf of others (brokers, agents) or (b) trade for their own account (dealers, principals). Must register under '34 Act §15. Two-hat activity: acting as agent earns a commission; acting as principal earns a mark-up/mark-down.

**Investment Advisers (RIAs)** — provide investment advice for compensation. Federal covered advisers (≥$100M AUM) register with the SEC under the Investment Advisers Act of 1940; smaller advisers register with states.

**Institutional investors** — insurance companies, pension plans, mutual funds, hedge funds, endowments, banks. An 'accredited investor' under Reg D 501(a) includes $1M net worth excluding primary residence, or $200K income ($300K joint) in each of the last two years.

**Other participants:** • **Transfer agents** — record securities ownership changes. • **Clearing firms / DTCC** — net and settle trades (T+1 as of May 2024 per SEA Rule 15c6-1). • **Trustees** — under the Trust Indenture Act of 1939, act for bondholders on public debt > $10M face. • **Municipal advisors** — advise municipalities; registered with SEC and MSRB under Dodd-Frank §975.

Securities Act of 1933 §3/§4 SEA Rule 15c6-1 (T+1) Reg D Rule 501(a)

Check yourself

3 quick questions — no score kept, just formative feedback.

  1. Q1 · SIE.1.A.1

    Which federal statute established the SEC and primarily regulates secondary-market trading of securities?

    Answer choices
  2. Q2 · SIE.1.D.2

    An issuer wants to raise $40 million from accredited investors using general solicitation. Which exemption applies?

    Answer choices
  3. Q3 · SIE.1.A.2

    The Securities Act of 1933 primarily regulates:

    Answer choices

Tutor

Scoped to SIE.1.B.1 .

  1. Ask questions about this passage. Answers cite the specific corpus chunk and regulation. The tutor will never reproduce real exam items.