Chaper 1 - 8

1

The 'Delivery versus Payment' system means that:

1

Which of the following gives the right, but not the obligation, to sell individual equity at a
specified date for a given price?

1

Which of the following types of investment incurs a liability for capital gains tax once sold?

1

A company's Market Value Added equates to the market assessment of the present value of
the company's future:

1

If a client wanted to make additional contributions to an occupational pension scheme, which of
the following options would give him the greatest choice of provider and a say in how the
funds are invested?

1

Portfolio performance is:

1

A client arranged for a wealth management firm to look after his investments on a non
discretionary basis. This means that the firm:

1

Which of the following Fitch ratings denotes the LOWEST level of risk for a bond?

1

Which of the following implications will help to ensure financial advisers act in their clients'
best interest?

1

If the real annual returns of a UK equity investment are normally distributed around the mean
return of 8% with a standard deviation of 4.5% approximately two-thirds of the returns
recorded will be within what range?

1

Which of the following is likely to be the MOST important consideration when selecting the
most appropriate protection product for a client?

1

Which of the following is a limitation rather than an assumption of the Capital Asset Pricing
Model?

1

One of the core functions of the financial services sector is to facilitate the bringing together
of:

1

Which of the following statements is TRUE about preference shares?

1

What are the possible implications for investment performance of investing in an ethical fund?

1

When considering the money supply, money is accurately described as anything that is
generally:

1

What type of information is contained in a Key Features Document?

1

An investor allowed the principle of 'regret aversion' to influence his actions. This resulted in
him:

1

Firms that specialise in looking after the assets of pension funds and fund managers are
normally known as:

1

Global Depositary Receipts traded on the London Stock Exchange are settled in which
currency?

1

Jackie is a private client investor and you ascertain that her investment objective and risk
tolerance are capital growth and cautious. During the meeting she asks you for your thoughts
on the use of derivatives. You respond that, in your opinion, derivatives:

1

Which of the following is a fiscal policy used to stimulate the economy?

1

Where the proposer and the life assured are different people under a life policy, the policy:

1

Why is a time weighted return (TWR) preferred to a money weighted return (MWR) when
evaluating performance?

1

Where a trade operates on a T+2 basis, this normally means that:

1

Which MAIN class of financial asset is normally considered to be the LEAST liquid?

1

Which of the following rules applying to financial intermediaries is directly underpinned by the
principle of fiduciary responsibility?

1

Two sets of data are positively correlated. If one set of data rises in value, what will happen to
the other set?

1

What is the MAIN purpose of a power of attorney document?

1

Four bond portfolios each hold a variety of stock. Which one of them is BEST described as
operating a barbell strategy?

1

Which of the following is a characteristic of a quote driven market?

1

Which measurement in relation to a fixed interest investment is given by the following
formula?

1

Corporation tax is a factor when considering investment as it can:

1

What differentiates Gross Domestic Product (GDP) and Gross National Product (GNP)?

1

Which of the following would MOST likely be found in a formal written report presenting
recommendations to a client?

1

Why do portfolios need a regular annual or periodic review?

1

A characteristic of the foreign exchange market is that:

1

The running yield of a corporate bond is determined by calculating the coupon as a percentage
of the:

1

When recommending an investment product to a client, what material information MUST the
adviser disclose in order to satisfy the fiduciary relationship that exists between the two
parties?

1

A function of the Monetary Policy Committee is to:

1

Where funds are to be set aside to provide for the future financial maintenance of a disabled
child, this can normally be achieved through the establishment of a legal document called a:

1

The excess return of a portfolio or security above that of the risk adjusted benchmark is known
as:

1

Which of the following types of organisation is MOST likely to arrange finance for a company
wanting to float on the stock market?

1

Where the mining costs of a particular metal increase to 105% of that metal's current price,
this indicates that:

1

An independent financial adviser would make recommendations on which type of product?

1

The demand curve for a particular product will be horizontal where the supplying firm operates
in:

1

What lump sum must someone aged 35 invest today given an assumed annual growth rate of
7% if they are to accrue a lump sum of £450,000 at the age of 65?

1

An investment manager believes that markets are inefficient and that he can obtain abnormal
returns after transaction charges. Which investment style is he most likely to adopt?

1

What inter-governmental body develops and promotes national and international policies to
combat money laundering and terrorist financing?

1

A call option is an option that generally confers

1

A consumer purchases a designated investment and the firm provides the consumer with
detailed cancellation rights over the telephone, immediately after the purchase. How has the
firm contravened the rules?

1

The annual return of a portfolio in each of the last six years has been 8.2%, 3.6%, 5.1%, 2.1%,
9.4% and 4.7%. What is the arithmetic mean return?

1

Who controls the assets of a trust and looks after the property for the person or persons who
will ultimately benefit from it?

1

An individual has been advised to invest in some shares by a friend. He wants to make sure that
he invests in companies which do not have a volatile share price. To achieve this he should
select shares which have a beta factor of:

1

One of the key objectives of financial services regulation is to:

1

Exchange-traded funds normally operate by:

1

Which is the MOST important reason for an adviser to conduct regular reviews of a client's
circumstances and arrangements?

1

A company's p/e ratio recently changed from 12 to 15. This normally indicates that:

1

John is worried that he will be unable to work due to a heart attack. Which of the following
would enable him to claim if he had a severe heart attack?

1

Which of the following is a feature in Arbitrage Pricing Theory (APT)?

1

The members of the International Organisation of Securities Commissions (IOSCO) collectively
regulate how much of the world's securities markets?

1

Units in a unit trust fund are sold by which of the following?

1

Paulo is a non-resident investor. How is he likely to benefit from a double taxation treaty?

1

Which of the following is MOST LIKELY to be a factor causing market movement?

1

What are two advantages of investing in an offshore trust?

1

Based on the principles of Modern Portfolio theory, an equity fund will operate on the
'efficient frontier' if:

1

Which of the following investments is covered by insider dealing legislation?

1

What is a key feature of exchange-traded commodities?

1

When conducting investment business for a private customer, what must a firm do?

1

The Liquidity (Acid Test) ratio measures a company's ability to:

1

When giving financial advice on the subject of protection, it is important to quantify a client's
assets to:

1

Bond portfolio X exclusively contains relatively long-dated stock whereas Bond portfolio Y
operates a laddering strategy. This means that Bond X is likely to:

1

In order to determine how 'efficient' the market is, financial service regulators will normally
consider the extent to which:

1

Where an investment fund established in the UK satisfies the UCITS directive and is sold in
another EU country, what is the position regarding local taxes and local marketing laws?

1

Which of the following would provide the lowest level of risk for risk averse investors with
short term horizons?

1

In a two-stock portfolio which of the following correlations would normally offer the greatest
level of diversification?

1

A client in the UK was granted lasting power of attorney in relation to his elderly mother. Why
did this facility fail to provide him with control over her financial affairs after she was deemed
to have lost her mental capacity?

1

In which country can shareholders be assured that listed companies will comply with the OECD
Principles for Corporate Governance?

1

The regulations state that Money Laundering Reporting Officers appointed by financial services
firms must:

1

The Undertakings for Collective Investment in Transferable Securities Directives (UCITS) cover
investment funds established in which location(s)?

1

How does asset allocation help meet a client's needs?

1

In technical analysis, the term, 'primary movement' refers to which of the following?

1

John is taking out a life insurance policy on Mary, his wife, and one for himself. Which of the
following statements is TRUE once the policy is in force?

1

An investor has a requirement for an 8% return and is considering choosing Stock X to satisfy
this need. Based on the Capital Asset Pricing Model, if the beta value of this stock is
recalibrated from 1.2 to 1.3, this would:

1

One of the fundamental aims of a traditional hedge fund is to minimise which type of
investment-related risk?

1

Which of the following is a factor that must be considered when constructing a portfolio?

1

The difference between a nominal rate of return and a real rate of return relates solely to the
effects of

1

Using Modern Portfolio Theory to create a two stock portfolio, which of the following is TRUE?

1

A private equity fund is MOST likely to use a structure similar to that of which of the following?

1

If clients approach a firm knowing exactly which product they wish to purchase, and ask the
firm simply to arrange the purchase, this type of transaction is normally described as:

1

Which of the following is NOT counted as part of the Current Account Balance?

1

Which of the following does a passive investment manager principally invest in?

1

If a collective investment scheme is unauthorised, this means that it is specifically banned
from:

1

Which mix of investments is most appropriate for a risk averse investor?

1

If $2,200 is invested for four years with interest at the rate of 6% p.a., compounded half-yearly,
what will be the value at the end of this period?

1

The relationship between an adviser and a client means that the adviser has a duty to:

Quiz am Chaper 1 - 8 , erstellt von Dale Doust am 03/09/2021.

Chaper 1 - 8

The 'Delivery versus Payment' system means that:

Which of the following gives the right, but not the obligation, to sell individual equity at a specified date for a given price?

Which of the following types of investment incurs a liability for capital gains tax once sold?

A company's Market Value Added equates to the market assessment of the present value of the company's future:

If a client wanted to make additional contributions to an occupational pension scheme, which of the following options would give him the greatest choice of provider and a say in how the funds are invested?

Portfolio performance is:

A client arranged for a wealth management firm to look after his investments on a non discretionary basis. This means that the firm:

Which of the following Fitch ratings denotes the LOWEST level of risk for a bond?

Which of the following implications will help to ensure financial advisers act in their clients' best interest?

If the real annual returns of a UK equity investment are normally distributed around the mean return of 8% with a standard deviation of 4.5% approximately two-thirds of the returns recorded will be within what range?

Which of the following is likely to be the MOST important consideration when selecting the most appropriate protection product for a client?

Which of the following is a limitation rather than an assumption of the Capital Asset Pricing Model?

One of the core functions of the financial services sector is to facilitate the bringing together of:

Which of the following statements is TRUE about preference shares?

What are the possible implications for investment performance of investing in an ethical fund?

When considering the money supply, money is accurately described as anything that is generally:

What type of information is contained in a Key Features Document?

An investor allowed the principle of 'regret aversion' to influence his actions. This resulted in him:

Firms that specialise in looking after the assets of pension funds and fund managers are normally known as:

Global Depositary Receipts traded on the London Stock Exchange are settled in which currency?

Which of the following gives the right, but not the obligation, to sell individual equity at a
specified date for a given price?

A company's Market Value Added equates to the market assessment of the present value of
the company's future:

If a client wanted to make additional contributions to an occupational pension scheme, which of
the following options would give him the greatest choice of provider and a say in how the
funds are invested?

A client arranged for a wealth management firm to look after his investments on a non
discretionary basis. This means that the firm:

Which of the following implications will help to ensure financial advisers act in their clients'
best interest?

If the real annual returns of a UK equity investment are normally distributed around the mean
return of 8% with a standard deviation of 4.5% approximately two-thirds of the returns
recorded will be within what range?

Which of the following is likely to be the MOST important consideration when selecting the
most appropriate protection product for a client?

Which of the following is a limitation rather than an assumption of the Capital Asset Pricing
Model?

One of the core functions of the financial services sector is to facilitate the bringing together
of:

When considering the money supply, money is accurately described as anything that is
generally:

An investor allowed the principle of 'regret aversion' to influence his actions. This resulted in
him:

Firms that specialise in looking after the assets of pension funds and fund managers are
normally known as:

Global Depositary Receipts traded on the London Stock Exchange are settled in which
currency?

Jackie is a private client investor and you ascertain that her investment objective and risk
tolerance are capital growth and cautious. During the meeting she asks you for your thoughts
on the use of derivatives. You respond that, in your opinion, derivatives:

Why is a time weighted return (TWR) preferred to a money weighted return (MWR) when
evaluating performance?

Which of the following rules applying to financial intermediaries is directly underpinned by the
principle of fiduciary responsibility?

Two sets of data are positively correlated. If one set of data rises in value, what will happen to
the other set?

Four bond portfolios each hold a variety of stock. Which one of them is BEST described as
operating a barbell strategy?

Which measurement in relation to a fixed interest investment is given by the following
formula?

Which of the following would MOST likely be found in a formal written report presenting
recommendations to a client?