Question 1

The UCITS regulations have been integral to introducing a common format for:

Options :

A : Company accounts

B : Corporate actions

C : Key investor information documents

D : Trade settlement

Answer: C

Question 2

Having prepared recommendations via a report, why would an adviser suggest a face-to-face meeting with their client?

Options :

A : In order to collect fees prior to implementation of the recommendations

B : To establish the client’s tax position

C : So that the client can review the adviser’s qualifications

D : To afford the opportunity to clear up any misunderstandings

Answer: D

Question 3

A stockbroking firm receives both buy and sell orders for the same security but from different clients. How can they best avoid a conflict of interest?

Options :

A : Withdraw their services for the transaction

B : Place orders as they are received from the clients

C : Openly disclose all orders received to the clients

D : Process the sell orders before the buy orders

Answer: B

Question 4

A rise in living standards will tend to:

Options :

A : Reduce the demand for commodities

B : Have no effect on commodities

C : Increase government participation in the commodities markets

D : Create an increased demand for commodities

Answer: D

Question 5

According to Modern Portfolio Theory (MPT), portfolios below the efficient frontier are not efficient because:

Options :

A : They attract additional charges

B : Risk-free assets are not profitable

C : The investor assumes proportionately higher risk for lower incremental returns

D : A greater return could be achieved for the same risk

Answer: D