Series 87 key terms

A written or electronic communication that includes an analysis of a security or an issuer and gives investors enough information to form the basis for an investment decision.

A person who is primarily responsible for preparing the substance of a research report or for making a public appearance that includes a recommendation or opinion about a security.

The issuer whose securities are analyzed or recommended in a research report, including any successor or affiliate covered by the report.

A required statement in a research report in which the analyst confirms that the views expressed are his or her personal views and that no part of compensation was, is, or will be tied to the specific recommendation.

SEC Regulation AC, which requires research analysts to certify that the views in their reports reflect their personal views and to disclose whether they received compensation tied to specific recommendations.

A firm's standardized category, such as buy, hold, or sell, that conveys its investment recommendation or expected performance for a covered security.

A forecast of the price a security is expected to reach within a stated period; if a report includes one, it must explain the basis and the risks.

A required table in a research report showing the percentage of the firm's ratings in each category and the percentage of rated companies that are investment banking clients.

A statement in a research report that identifies relationships, compensation, or interests involving the firm or analyst and the subject company that could affect the report's objectivity.

Required disclosure of the research analyst's and the firm's ownership of the subject company's securities, including whether holdings exceed specified thresholds.

A statement disclosing whether the firm makes a market in the subject company's securities or has managed or co-managed a public offering for the company.

Activities such as underwriting securities, advising on mergers or acquisitions, or arranging private placements, for which the firm receives compensation and that create potential conflicts with research.

Policies, physical controls, and electronic restrictions that prevent the improper flow of nonpublic information between investment banking personnel and research analysts.

A set period after an initial public offering or other offering during which the firm limits or prohibits publishing research or making public statements about the issuer.

A contract that prohibits insiders and pre-offering shareholders from selling shares for a specified period after an offering; analysts must not improperly modify or waive its terms.

A prohibited practice in which an analyst publishes a favorable report shortly after an offering to support the security's price, often to help the investment banking department.

A presentation by the firm to a prospective issuer to win investment banking business; research analysts' participation is restricted to prevent conflicts.

A rule that prohibits a firm from retaliating against a research analyst because the analyst issued a negative or unfavorable research report or recommendation.

A committee that reviews and approves research analyst compensation and must ensure that it is not based on specific investment banking revenue or transactions.

A relationship, interest, or compensation arrangement that a reasonable investor would consider important in deciding whether to rely on the research.

Information that is not generally available to the public and that may not be used in research or shared improperly with others.

A service that connects research analysts with industry experts; firms must screen interactions to avoid receiving material nonpublic information.

The FINRA rule governing research analysts and research reports, including information barriers, disclosure requirements, compensation practices, and anti-retaliation protections.

Any participation in a seminar, forum, radio or television interview, or other public speaking activity in which an analyst makes a recommendation or offers an opinion about a security.

The FINRA rule governing research analysts' public appearances, including required disclosures, approval of scripts, and restrictions on interactions with the media.

A provision of the Securities Act of 1933 that requires anyone who publishes information about a security for compensation to disclose the amount and source of that compensation.

Any written or electronic communication distributed to more than 25 retail investors within a 30-day period; it generally requires principal approval before use.

Written or electronic communication distributed to 25 or fewer retail investors within a 30-day period; it must be supervised and reviewed but does not require pre-approval.

Interactive electronic communications such as posts and comments that are subject to the same content standards, supervision, and recordkeeping as other public communications.

A statement by a client or third party about the analyst, representative, or firm; restrictions apply when used in research or advertising.

The approval of a research report or public communication by a registered principal before it is distributed, ensuring compliance with content and disclosure rules.

A firm's duty to monitor its associated persons and business activities to ensure compliance with securities laws, regulations, and internal procedures.

A firm's documented policies and procedures describing how it supervises its business and personnel to comply with applicable securities rules.

A rule requiring firms to make and preserve specified books and records, including research reports, communications, and supervisory records, for required periods.

Required ongoing training for registered persons, consisting of a regulatory element and a firm element, to maintain knowledge of rules and products.

A formal signed certification, often by a senior officer, that the firm has complied with specified supervisory or regulatory requirements.