CISI CMP Securities Practice Questions - CISI Capital Markets Programme - Securities Exam - CISI CMP Securities Practice Questions - CISI Capital Markets Programme

Question 1

What is the primary economic function of a capital market?

To set interest rates for central banks To channel funds from savers to organisations that need long-term capital To guarantee a profit on every investment To replace the role of commercial banks in lending

Correct Answer:

To channel funds from savers to organisations that need long-term capital

Question 2

Which of the following best describes the difference between the money market and the capital market?

The money market trades only shares; the capital market trades only bonds The money market deals in short-term instruments (typically under one year); the capital market deals in longer-term securities The money market is unregulated; the capital market is regulated The money market is open only to retail investors

Correct Answer:

The money market deals in short-term instruments (typically under one year); the capital market deals in longer-term securities

Question 3

In securities markets, what is a 'sell-side' firm?

A firm that only sells its own shares A firm such as an investment bank or broker that creates, promotes and sells securities and provides execution services A pension fund that buys assets for the long term A regulator that supervises market conduct

Correct Answer:

A firm such as an investment bank or broker that creates, promotes and sells securities and provides execution services

Question 4

Which institution typically acts as a custodian in the securities industry?

A firm that holds and safeguards clients' securities and processes related events A firm that sets the price of new share issues A central bank that issues currency A retail broker that gives investment advice

Correct Answer:

A firm that holds and safeguards clients' securities and processes related events

Question 5

What distinguishes a 'principal' trade from an 'agency' trade?

A principal trade is always larger than an agency trade In a principal trade the firm trades from its own book and takes on risk; in an agency trade the firm acts on behalf of a client without taking a position A principal trade involves only bonds; an agency trade involves only equities There is no difference in modern markets

Correct Answer:

In a principal trade the firm trades from its own book and takes on risk; in an agency trade the firm acts on behalf of a client without taking a position

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About this Exam

Prepare with the CISI CMP Securities Practice Questions - CISI Capital Markets Programme - Securities Exam practice quiz. This question bank includes 100 questions covering market, shares, investor, issue, and securities. Use it to review important concepts, identify knowledge gaps, and build confidence for the related exam, course, or assessment.

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CISI CMP Securities Practice Questions - CISI Capital Markets Programme - Securities Exam

This practice set contains 100 questions from the matching question bank and focuses on market, shares, investor, issue, and securities. Work through each question carefully, review the provided solutions, and revisit topics that need more study before your next attempt.

This is an independent study resource intended for practice and review; it is not an official examination or an endorsement by any organization named in the title.

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CISI CMP Securities Practice Questions - CISI Capital Markets Programme - Securities Exam

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