Quiz
Chapter 3+4
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Questions in this quiz (17)
1 Which of the following gives the right, but not the obligation, to sell individual equity at a
specified date for a given price?- AFuture
- BForward contract
- CPut option
- DCall option
2Which of the following Fitch ratings denotes the LOWEST level of risk for a bond?
- AD
- BBBB
- CC
- DAAA
3Which of the following statements is TRUE about preference shares?
- AThe most common type is the deferred share
- BThey offer a lower dividend rate than the comparative coupon rate on a debenture
- CDividends are guaranteed each year
- DIn most cases they do not carry voting rights
International Certificate in Wealth & Investment Management
4Global Depositary Receipts traded on the London Stock Exchange are settled in which
currency?- AEuros
- BUS Dollars
- CJapanese Yen
- DUK Sterling
5Which MAIN class of financial asset is normally considered to be the LEAST liquid?
- AEquities
- BCorporate bonds
- CGovernment bonds
- DProperty
6Which measurement in relation to a fixed interest investment is given by the following
formula?- AGrossed up redemption yield
- BGross redemption yield
- CNet redemption yield
- DRunning yield
7The running yield of a corporate bond is determined by calculating the coupon as a percentage
of the:- Amarket price
- Bissue price
- Cgross dividend
- Dnominal value
8Where the mining costs of a particular metal increase to 105% of that metal's current price,
this indicates that:- Ademand is significantly rising
- Bsupply has become unreliable
- Cthere is likely to be a shortage of raw materials
- Dproduction activities are likely to stop
9A call option is an option that generally confers
- Athe right to buy
- Bthe right to sell
- Ca contract to sell
- Da contract to buy
10Exchange-traded funds normally operate by:
- Atracking indices
- Btracking an individual security
- Cinvesting in fund of funds
- Dinvesting in manager of managers funds
11Units in a unit trust fund are sold by which of the following?
- AThe trustee
- BThe registrar
- CThe manager
- DThe depositary
12What is a key feature of exchange-traded commodities?
- AThey are an open-ended collective investment vehicle
- BThey are available only to high net worth individuals
- CThere is limited exposure to derivative contracts
- DNo additional shares can be created by the fund
13Where 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?- AIt will not be subject to either
- BIt will be subject to local taxes but not local marketing laws
- CIt will be subject to local marketing laws but not local taxes
- DIt will be subject to both local taxes and local marketing laws
14The Undertakings for Collective Investment in Transferable Securities Directives (UCITS) cover
investment funds established in which location(s)?- AEngland and Wales only
- BUK only
- CUK and France only
- DAll European Union countries
15One of the fundamental aims of a traditional hedge fund is to minimise which type of
investment-related risk?- AInflation risk
- BIssuer risk
- CMarket risk
- DLiquidity risk
16 A private equity fund is MOST likely to use a structure similar to that of which of the following?
- AInvestment Trust
- BLimited Partnership
- COEIC
- DSICAV
17 If a collective investment scheme is unauthorised, this means that it is specifically banned
from:- Aoperating a bid/offer spread
- Bholding some of the fund assets in cash
- Cbeing marketed to the general public
- Dpaying out dividends
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- User has deleted their subject information Quiz on Chapter 3+4, created by Deleted user on 03/09/2021.
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- Created on 3 Sep 2021 · updated on 17 Sep 2021
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