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Free Investment Funds in Canada (IFC) Exam Practice Questions

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Total Questions : 537

Start with our free IFC practice questions, carefully crafted to mirror the domains, phrasing, and difficulty of the real Investment Funds in Canada exam. Each IFC exam question comes with a detailed rationale that explains not just which answer is correct but why the others fall short. That's how concepts stick. Use the free set to benchmark yourself: identify your CSI weak domains, see where you're losing marks, and build a focused study plan in minutes.

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Question # 151

The fund manager for the VT Canadian Equity Fund looks for stocks that are out of favour and trading for less than their intrinsic value. What equity investing philosophy is the fund manager following?

Options:

A.  

Momentum investing.

B.  

Sector rotation.

C.  

Value investing.

D.  

Growth at a reasonable price.

Discussion 0
Question # 152

Which of the following statements is TRUE about inflation?

Options:

A.  

Inflation results in a redistribution of income from borrowers to lenders.

B.  

Generally inflation will benefit those who are living on investment income.

C.  

Purchasing power rises as inflation rises.

D.  

An increase in the inflation rate could mean investors have less money to invest.

Discussion 0
Question # 153

Charlotte has received proceeds from a deceased family member’s estate. Charlotte decides to visit Malik, who’s a Dealing Representative at her bank. She tells Malik, she does not know much about trading ETFs, but she wants to invest in ETFs. Charlotte says she feels fortunate to have this money and that she’s not worried about losing it because she never planned on having any of it.

What element of the Know Your Client (KYC) information has Malik been able to learn?

Options:

A.  

Risk Profile

B.  

Risk Capacity

C.  

Risk Preference

D.  

Risk Tolerance

Discussion 0
Question # 154

Russell is a Dealing Representative with Wealth Quest Strategies Ltd., a mutual fund dealer and member of the Mutual Fund Dealers Association of Canada (MFDA). Russell is developing his website to

include sales content on a Target Date Fund. Which of the following is Russell permitted to include on his website about the Target Date Fund?

i. the asset mix through the life of the fund until the future date

ii. the expected decline in the fund ' s risk level as the fund reaches its target date

iii. the guaranteed return that the client will receive on the future date

iv. a graphic illustration of the fund ' s promised growth on target date

Options:

A.  

i and ii

B.  

i and iii

C.  

ii and iv

D.  

iii and iv

Discussion 0
Question # 155

What items are typically classified as current assets on the statement of financial position?

Options:

A.  

Cash, accounts receivable, and retained earnings

B.  

Cash, accrued charges, and accounts receivable

C.  

Cash, accounts receivable, and inventories

D.  

Cash, inventories, and depreciation

Discussion 0
Question # 156

What can a capital loss be applied against when computing Canadian income taxes?

Options:

A.  

Dividend income only

B.  

All types of investment income

C.  

Capital gains only

D.  

All types of income

Discussion 0
Question # 157

Your client Jerry ' s asset mix is deviating from the original target asset mix because the stock market has had strong performance. Equities are now over-weighted in Jerry ' s account. The original target asset mix is still valid since Jerry ' s situation has not changed. He is invested in several bond and equity mutual funds. What should you do?

Options:

A.  

advise him to change his know your client (KYC) form to reflect more growth

B.  

advise him to do nothing since equities could outperform bonds in the next year

C.  

advise him to sell a portion of assets invested in bond funds and reinvest the proceeds into equity funds

D.  

advise him to sell a portion of assets invested in equity funds and reinvest the proceeds into bond funds

Discussion 0
Question # 158

Natasha currently owns 2 mutual funds: a bond fund and a Canadian equity fund. She would like to use one of them as her registered retirement savings plan (RRSP) contribution for the year. From a tax efficiency perspective, which mutual fund should she contribute?

Options:

A.  

the equity fund

B.  

the bond fund

C.  

either since it makes no difference

D.  

it depends on her marginal tax rate

Discussion 0
Question # 159

You ask a new client, Brad, " what are your financial obligations and what are your assets? " What information are you trying to gather in order to comply with the know your client (KYC) rule?

Options:

A.  

net worth

B.  

marginal tax rate

C.  

income and cash-flow

D.  

tax consequences

Discussion 0
Question # 160

A mutual fund sales representative is under pressure to meet certain sales objectives. However, he consistently ignores these quotas when making client recommendations. Which standard of conduct has he followed?

Options:

A.  

Provision of appropriate cautions for potentially unsuitable investments

B.  

The obligations to put the client’s interests first

C.  

The obligation to keep client information confidential

D.  

The maintenance of a high standard of professional knowledge

Discussion 0
Question # 161

A risk-averse investor is meeting with their advisor to discuss investment solutions. Traditionally, the investor has considered GICs only, but they are open to considering other alternatives. To what emotional bias is the investor most susceptible?

Options:

A.  

Hindsight

B.  

Status quo

C.  

Loss aversion

D.  

Endowment

Discussion 0

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