ICWIM Practice Questions

A.  

Assessing suitability and affordability

B.  

Determining attitude to risk

C.  

Giving information on status disclosure

D.  

Client fact-finding

A.  

Numerous heterogeneous products are produced by all firms in the industry

B.  

Firms face barriers to entry or exit from the industry

C.  

There are a range of market prices at which all output produced by any one firm can be sold

D.  

There is an infinite number of consumers who all face the same market price

A.  

Financial Conduct Authority

B.  

United Nations

C.  

Wolfsberg Group of Banks

D.  

Financial Action Task Force

A.  

The potential to counter inflationary effects

B.  

Their lower cost compared to other assets

C.  

The ability to align liabilities with profits from equities

D.  

Their low volatility when compared to bonds

A.  

To ensure any tax deferral benefits are not lost

B.  

To ensure that the commission as a proportion of the fund remains small

C.  

Because the investor has not held the units past the 'lock-in’ period

D.  

To allow fund managers to raise enough funds to pay out to those wishing to sell their units

A.  

They swap the return on the index in exchange for a fixed fee

B.  

The loss on an index is swapped for the profit on a different index

C.  

Having created an index fund, the managers use swaps to cover the tracking error

D.  

They swap a pre-defined return in exchange for the return on the index

A.  

Easier to calculate

B.  

More widely accepted

C.  

Unaffected by small data sets

D.  

Expressed in the same units

A.  

Offer the client a range of options

B.  

Draw attention to the cancellation period

C.  

Gather sufficient information from the client

D.  

Ensure recommendations are confirmed by a third party

A.  

Overseas Taxation Relief

B.  

Dividend Taxation Relief

C.  

Double Taxation Relief

D.  

Double Taxation Agreement

A.  

It is always riding the yield curve

B.  

It only invests in short-dated bonds

C.  

The gross redemption yield is always higher

D.  

A bullet portfolio does not require regular rebalancing