SERIES-63 practice question 33 of 35
Mr. L. Ranger is an agent for a broker-dealer and has overheard “talk” that a merger between two well-known high-tech companies is about to take…
Choose your answer, then check it against the explanation.
Mr. L. Ranger is an agent for a broker-dealer and has overheard “talk” that a merger between two
well-known high-tech companies is about to take place. Mr. Ranger knows that, on average, in these
instances the target firm’s price spikes. He calls his client and good friend, Mr. Tonto, and tells him of
the rumor, suggesting that Tonto might want to buy shares in the target firm. He tells Mr. Tonto that
if the rumor isn’t true, the target firm’s price may not spike at all and may, in fact, decline, and
suggests that Mr. Tonto not invest any money he isn’t willing to lose. Mr. Ranger knows that his
friend likes to gamble, and decided he wouldn’t be much of a friend if he didn’t inform Tonto of this
potential opportunity.
Has Mr. L. Ranger violated any laws or engaged in any prohibited practices?
Question 33 of 35
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