SIE Exam Question 839: Answer and Explanation

Question: 839

Which of the following is the first prospectus released for a new issue, and is intended to solicit indications of interest? It does not contain the new issue's price, and it is subject to change.

• A. Pink sheet
• B. Red herring
• C. Shelf registration
• D. Tombstone ad

Correct Answer: B

Explanation:

A red herring is the first prospectus released for a new issue and is intended to solicit indications of interest. It does not contain the new issue's price, and it is subject to change.