If an investor expects to receive a bullet payment, they are likely to be invested in a:
If an investor expects to receive a bullet payment, they are likely to be invested in a:A . Treasury bondB . Zero coupon bondC . Convertible bondD . Premium bondView AnswerAnswer: B Explanation: Understanding Bullet Payments: A bullet payment is a single payment of principal and interest at maturity. Zero...
The coupon on a bond has been expressed in real terms, rather than as a nominal amount.
The coupon on a bond has been expressed in real terms, rather than as a nominal amount. This is because:A . It is an inflation-linked bondB . Its redemption date is longer than 10 yearsC . It is an unsecured instrumentD . It is a bearer bondView AnswerAnswer: A Explanation:...
The UCITS regulations have been integral to introducing a common format for:
The UCITS regulations have been integral to introducing a common format for:A . Company accountsB . Corporate actionsC . Key investor information documentsD . Trade settlementView AnswerAnswer: C Explanation: The UCITS (Undertakings for the Collective Investment in Transferable Securities) regulations mandate that fund managers provide a standardized Key Investor Information...
If the interest is credited to the account at the end of the year and the investor leaves the money in the account for 5 years, how much money will be in the account at the end of the fifth year?
An investor deposits £1,000 into an account that pays interest at the rate of 3% per year. If the interest is credited to the account at the end of the year and the investor leaves the money in the account for 5 years, how much money will be in the...
What fiduciary responsibility does a financial adviser have for their clients?
What fiduciary responsibility does a financial adviser have for their clients?A . Decrease the overall risk of their portfolioB . Provide their services at a competitive feeC . Act in the best interests of their clientsD . Offer conservative advice with low riskView AnswerAnswer: C Explanation: Fiduciary Duty: A fiduciary...
The management of investment portfolios of collective investment schemes, pension funds, insurance funds, hedge funds, and private equity would normally be considered to fall into the scope of:
The management of investment portfolios of collective investment schemes, pension funds, insurance funds, hedge funds, and private equity would normally be considered to fall into the scope of: A. The retail financial sector B. The wholesale financial sector C. Family offices D. Private bankingView AnswerAnswer: B Explanation: Wholesale Financial Sector...
How would an active fund manager seek to avoid underperforming their peer group when deciding on asset allocation?
How would an active fund manager seek to avoid underperforming their peer group when deciding on asset allocation? A. Through the use of asset allocation by consensus B. By assessing the prospects for each main asset class C. By hedging currency and market risk D. Through the use of quantitative...
Which type of investment is associated with providing finance to growing companies with the objective of exiting via a profitable stock market listing?
Which type of investment is associated with providing finance to growing companies with the objective of exiting via a profitable stock market listing?A . Convertible bondsB . Preference sharesC . Private equityD . Structured productsView AnswerAnswer: C Explanation: Private Equity and Growing Companies: Private equity involves investing in privately-held companies...
If someone in a fiduciary position has personal or professional interests that compete with their duty to act in the client’s best interest, this is called:
If someone in a fiduciary position has personal or professional interests that compete with their duty to act in the client’s best interest, this is called:A . Discretionary managementB . A regulatory breachC . Full disclosureD . A conflict of interestView AnswerAnswer: D Explanation: Conflict of Interest Definition: A fiduciary...
How does standard deviation provide investors with a measure of historical volatility?
How does standard deviation provide investors with a measure of historical volatility?A . By the analysis of historical share price movementsB . Through the measurement of the highs and lows of each assetC . By measuring the degree of fluctuation around the meanD . Through the measurement of share price...