CSC2 by CSI Actual Free Exam Q&As

Question 1

A shareholder receives rights from a company through direct ownership in shares. Not expecting to exercise them, she sells the rights on the relevant exchange. What is her capital gain?

A. The sale price less the exercise price of the rights. B. The current share price less the exercise price of the rights. C. The current price of the shares less the sale price of the rights. D. The sale price of the rights.

Discussion 0

Correct Answer: D Vote an answer

Question 2

For what type of company is the dividend discount model least applicable?

A. One with changing dividend payments and a stable dividend growth rate. B. One with stable dividend payments and a fluctuating dividend growth rate. C. One with stable dividend payments and a stable dividend growth rate. D. One with changing dividend payments and a fluctuating dividend growth rate.

Discussion 0

Correct Answer: D Vote an answer

Explanation: Only visible for PassTestking members. You can sign-up / login (it's free).

Question 3

What is name of the procedure used to calculate the income deemed to have been earned by segregated fund contract holders?

A. Redemption. B. Payout. C. Distribution. D. Allocation.

Discussion 0

Correct Answer: D Vote an answer

Question 4

Soft-dollar arrangements can be used for which type of service?

A. Sales. B. Advice. C. Underwriting. D. Research.

Discussion 0

Correct Answer: D Vote an answer

Question 5

What is the main pitfall of closet indexing for investors?

A. Investors must take greater risks due to a high portfolio beta. B. passively management fund can be marketed as actively managed. C. The portfolio does not closely resemble the benchmark index. D. High portfolio turnover makes it unsuitable for taxable accounts

Discussion 0

Correct Answer: B Vote an answer

Explanation: Only visible for PassTestking members. You can sign-up / login (it's free).

Question 6

What type of investment has the ability to bypass probate?

A. Structured product. B. Segregated fund. C. Exchange-traded fund. D. Mutual fund.

Discussion 0

Correct Answer: B Vote an answer

Explanation: Only visible for PassTestking members. You can sign-up / login (it's free).

Question 7

What is the key objective for investors in alternative strategy funds?

A. To maximize risk-adjusted returns. B. To achieve absolute returns C. To match the performance of a reference index. D. To exceed the current rate of inflation.

Discussion 0

Correct Answer: B Vote an answer

Explanation: Only visible for PassTestking members. You can sign-up / login (it's free).

Question 8

Which type of trader specializes in managing block trades on behalf of institution clients?

A. Agency trader B. Market maker C. Liability trader D. Responsible designated trader.

Discussion 0

Correct Answer: A Vote an answer

Explanation: Only visible for PassTestking members. You can sign-up / login (it's free).

Question 9

A financial institution is selling their pooled mortgages to a Special Purpose Vehicle. What process are they engaging in?

A. Share splitting. B. Credit spread arbitrage. C. Asset securitization. D. Merger strategy.

Discussion 0

Correct Answer: C Vote an answer

Question 10

For buy-side institutional investors, what is the purpose of algorithmic trading?

A. To optimize the order execution of small trades. B. To reduce overall trading order execution costs. C. To optimize the order execution of a large block of shares by breaking it up into smaller trades. D. To consolidate a large number of individual trades into a single trade to reduce the market impact.

Discussion 0

Correct Answer: C Vote an answer

Question 11

The price of FMA common stock is set to break through its 200-day moving average line from below on heavy volume. How might a technical analyst interpret this information?

A. The declining price trend will continue. B. The upward price trend is reversing. C. A buy signal as FMA ' s price is set to rise. D. A sell signal as FMA ' s price is set to fall.

Discussion 0

Correct Answer: C Vote an answer

Question 12

What investment becomes liquid when securitized?

A. Fine art. B. Gold. C. Real estate. D. Airport.

Discussion 0

Correct Answer: C Vote an answer

Explanation: Only visible for PassTestking members. You can sign-up / login (it's free).

Question 13

What do a hedge fund's liquidity dates indicate?

A. The period that non-accredited investors can enter a hedge fund by purchasing newly issued shares. B. The period that the hedge fund manager is forced to unwind all its investment positions. C. The period that a hedge fund is expected to cover its short positions. D. The period that existing investors in the hedge fund can redeem their shares.

Discussion 0

Correct Answer: D Vote an answer

Explanation: Only visible for PassTestking members. You can sign-up / login (it's free).

Question 14

What event would trigger an amendment of the account application while monitoring a portfolio?

A. When a client ' s job situation has changed. B. The annual client meeting. C. When a new market cycle is formed. D. When the advisor ' s views are influenced by a recent news headline.

Discussion 0

Correct Answer: A Vote an answer

Question 15

Tom sold some bonds in his RRSP and used the total $100,000 in proceeds to buy a 75% guaranteed segregated fund. Three years later, Tom died. At the time of his death, the market value of the segregated fund was $700,000. Assuming no interim withdrawal on market value reset, what is the death benefit payable from this investment?

A. $0, B. $30,000 C. $5, 000 D. $70,000

Discussion 0

Correct Answer: B Vote an answer

Explanation: Only visible for PassTestking members. You can sign-up / login (it's free).

CSI Canadian Securities Course Exam2 - CSC2 Exam Practice Test