[Nov-2023] CIFC PDF Dumps Are Helpful To produce Your Dreams Correct QA's
New CIFC exam Free Sample Questions to Practice
NEW QUESTION # 12
Your clients, Philip and Helen, have a disabled son, Alex, age 22. They want to set up a registered disability savings plan (RDSP) for Alex and have asked you for some information.
Which statement is TRUE?
- A. Philip and Helen's contributions are refundable to them.
- B. There is no annual or lifetime maximum limit on contributions.
- C. Alex must quality for the disability tax credit.
- D. Philip and Helen's contributions are tax-deductible.
Answer: C
NEW QUESTION # 13
Pierre wants to discuss the merits of a specific mutual fund with his Dealing Representative, Simone. There are no trailer fees associated with this fund. Simone is familiar with the mutual fund that Pierre is referring to, which is not offered by her dealer. They schedule an appointment to further discuss his investment portfolio.
Which behaviour from Simone is ethical?
- A. When comparing her dealer's own mutual funds to the one Pierre discovered, Simone emphasizes the importance of similar net rates of return and minimizes the significance of management expense ratios (MERs).
- B. Simone's ability to keep her knowledge current on competitors' investment offerings shows that she is putting her client's interest first.
- C. While comparing Fund Facts of the different mutual funds, Simone points out that not only are the fund management expenses different but so are the investor profiles for each fund.
- D. Knowing Pierre does not like that her dealer's funds have trailer fees, she chooses not to discuss the relationship between trailer fees and MER while making comparisons.
Answer: C
NEW QUESTION # 14
Your client, Rinaldo, wants to know more about the fees associated with his mutual funds. What can you tell him about a mutual fund's management expense ratio (MER)?
- A. The MER reflects the percentage of each dollar of fund assets that is used to pay for management services.
- B. Mutual fund performance is not impacted by the MER since rates of return are published net of fees.
- C. Mutual funds are required to calculate the MER on a daily basis.
- D. Trailer and brokerage fees are charged separately from the MER.
Answer: A
NEW QUESTION # 15
Sandra presently participates in her employer-sponsored defined contribution pension plan (DCPP). As contributions continue to be made into her plan, what can she expect?
- A. Her available registered retirement savings plan (RRSP) contribution room will be reduced by what is being contributed to her plan.
- B. Retirement benefits will be based on a prescribed formula that can be referenced from the plan's terms and conditions.
- C. To ensure she has savings at retirement, the employer will choose stable investments to grow her retirement savings.
- D. The employer will solely make contributions to her DCPP based on a prescribed formula noted within her plan.
Answer: A
NEW QUESTION # 16
Janine will celebrate her 71st birthday this year. She currently has a lot of money in a personal registered retirement savings plan (RRSP) and knows there are rules about what she can do with those funds. Which of the following is TRUE?
- A. She can convert her RRSP to a registered retirement income fund (RRIF) this year or by December 31st of next year.
- B. She can take the entire amount in cash, with no tax consequences because her RRSP funds were tax-sheltered.
- C. She can convert her RRSP to a locked-in retirement income fund (LRIF).
- D. She can purchase a registered term or life annuity.
Answer: D
NEW QUESTION # 17
What does a normal yield curve look like?
- A. slopes upward to the right
- B. slopes down to the right
- C. slopes upward to the left
- D. is flat and has no slope
Answer: A
NEW QUESTION # 18
David had $10,000 in his investment account with Dynamic Investments, a mutual funds dealer. On June 28, David wants to buy 500 units in ABC Canadian Dividend Fund that has a Net Asset Value Per Unit (NAVPU) of $14.10. His friend Robert suggests that he may get a better price if he used the strategy of dollar-cost averaging. David then instructs his Dealing Representative to place a purchase order for 100 units on the first of every month starting July 1st for the next 5 months.
The orders are executed at the following NAVPUs.
July 01, $14.00
Aug. 01, $14.50
Sep. 01, $15.00
Oct. 01, $14.25
Nov. 01, $16.50
Did David get a better purchase price following the dollar-cost averaging strategy compared to making a lump-sum purchase of 500 shares on Jun 28, 20xx?
- A. David got his 500 units at the same price as the lump sum price he would have paid.
- B. David got his 500 units at a lower price than the lump sum price he would have paid.
- C. David got his 500 units at a higher price than the lump sum price he would have paid
- D. David realizes that Dollar cost averaging is the best strategy for getting lower prices.
Answer: C
NEW QUESTION # 19
Which of the following statements regarding mutual fund fees is correct?
- A. Trailer fees are only paid to mutual fund dealers when a purchase is made.
- B. Trading commissions are paid from the management fee.
- C. The mutual fund dealer receives trailer fees based on the value of assets under management.
- D. Redemptions are made from units held by investors to pay trailer fees.
Answer: C
NEW QUESTION # 20
Stan, a portfolio manager, is looking at two steel companies as potential investments. Truesteel Inc. has a current ratio of 2:1 while Strongco Ltd. has a current ratio of 0.8:1.
What could this information indicate?
- A. It appears that Truesteel is more profitable than Strongco.
- B. Stronqco is reiving less on debt financing than Truesteel.
- C. Truesteel is better able to meet its short term financial obligations than Strongco.
- D. The stock market is more optimistic about the prospects for Truesteel than Strongco.
Answer: C
NEW QUESTION # 21
Which of the following statement about Exchange Traded Funds (ETFs) is TRUE?
- A. All ETFs are actively managed.
- B. Usually the market price of an ETF is the net asset value per unit (NAVPU) of the Fund on that day.
- C. Investors may sell their ETFs in the stock market or redeem them through the Fund at the NAVPU of the day.
- D. ETFs have lower MERs compared to mutual funds.
Answer: D
NEW QUESTION # 22
Which of the following best describes implied needs of your clients?
- A. They are statements made by clients expressing the desire for lower commissions.
- B. They are needs reflected by statements made by clients regarding problems and dissatisfactions.
- C. They are statements made by you showing readiness to solve a client's problem.
- D. They are statements of wants and needs made by clients.
Answer: B
NEW QUESTION # 23
Which among the following BEST describes a company's income statement?
- A. It provides a snapshot of a company's financial position at a specific point in time
- B. It shows the earnings and expenses of a business over a period of time.
- C. It shows the amount of capital contributed to the company by its shareholders or owners.
- D. It shows the amount of profit that is reinvested in the company in the form of retained earnings.
Answer: B
NEW QUESTION # 24
Greg, one of your clients, has been advised by a friend to invest in open-end mutual funds. He is not sure about the differences between open and closed-end funds.
What would you tell Greg about open-end funds?
- A. Units are bought and sold amongst the unitholders.
- B. Initial shares in the mutual fund are allotted through an initial public offering (IPO)
- C. Investors holding open-end funds can buy and sell their mutual funds anytime the stock market is open.
- D. The number of units is not fixed, and varies with investor demand and redemption orders.
Answer: D
NEW QUESTION # 25
Ai Fen has recently become registered to sell mutual funds with Acadian Eastern Financial, a mutual fund dealer. Ai Fen determined that with her background of being a Chartered Financial Analyst, she can help people understand the nature of investing more easily than others in her field.
Which registration category will need to be prominently noted on Ai Fen's business card to comply with the
"holding out rule"?
- A. Investment Representative
- B. Registered Representative
- C. Chartered Financial Analyst
- D. Dealing Representative
Answer: D
NEW QUESTION # 26
Bernadette has a high-paying job and is in the top tax bracket. She recently received a payment of $5 million upon the settlement of her uncle's estate. Bernadette would like to invest her inheritance in financial products that would not only grow her money but is also income tax friendly.
Which of the following would provide the most favourable tax treatment?
- A. Dividends received from a large foreign corporation.
- B. Capital gains from a large Canadian corporation.
- C. Coupon payments from Government of Canada bonds.
- D. Eligible dividends from a publicly-listed Canadian corporation
Answer: D
NEW QUESTION # 27
Lior is considering an investment that gains exposure to companies that trade on the Toronto Stock Exchange (TSX). He is not sure what the differences are between a Canadian equity fund and a Canadian dividend fund.
What would you tell him?
- A. Dividend funds generate tax-preferred income while income from equity funds is fully taxable.
- B. Equity funds are more appropriate than dividend funds if Lior requires a steady flow of income.
- C. Dividend funds tend to be less volatile and lower risk than equity funds.
- D. Equity funds hold common shares while dividend funds hold only preferred shares.
Answer: C
NEW QUESTION # 28
One of your clients, Fernando, is approaching 71 years of age and has a few questions regarding life income funds (LIFs).
Which of the following statements about LIFs is TRUE?
- A. Fernandocan transfer money from his registered retirement savings plan (RRSP) to a LIF.
- B. Fernando can transfer money from his locked-in retirement account (LIRA) to a LIF.
- C. Fernando is free to withdraw any amount from his LIF above the minimum amount.
- D. Fernando may make contributions tohis LIF if he continues working.
Answer: B
NEW QUESTION # 29
Portia is a Dealing Representative with Highview Wealth Inc., a mutual fund dealer. Portia recommends the Stature Growth Fund to her client Clive. Which of the following CORRECTLY describes what Portia must do in order to satisfy her obligations under the Client Relationship Model (CRM) and Client Focused Reforms (CFR)?
- A. Portia must provide Clive with the pre-trade disclosure to address any material conflicts of interest with the trade.
- B. Portia must disclose the costs, expenses, and ongoing fees associated with the investment prior to the trade.
- C. Portia must calculate the net asset value per unit (NAVPU) and report it to Give in the trade confirmation.
- D. Portia must mark the trade as ^unsolicited" if Clive wants to proceed with the trade and it is not suitable for him.
Answer: B
NEW QUESTION # 30
What purpose does it serve for non-money market mutual funds to hold money market instruments?
- A. They are purchased by non-money market funds to satisfy the regulatory requirement of fund diversification.
- B. If the portfolio manager has an immediate need for cash, money market instruments are relatively easy to liquidate.
- C. Money market instruments primarily generate investment income that provides investors with preferential tax treatment.
- D. They ensure that the fair market value of a mutual fund will not drop below a minimal market value.
Answer: B
NEW QUESTION # 31
Karen's know your client (KYC) profile corresponds to someone who has a long time horizon, is comfortable with risk and volatility, and is primarily interested in growth. She watches the daily movements of the Toronto Stock Exchange (TSX) and wants a mutual fund that will closely match what she sees.
What kind of mutual fund would be BEST for her?
- A. Canadian small capitalization equity fund
- B. Canadian bond fund
- C. Canadian equity index fund
- D. Canadian dividend fund
Answer: C
NEW QUESTION # 32
Danica is looking for a mutual fund to hold in her non-registered account that provides a regular stream of income with potential for capital growth. She is having difficulty distinguishing between bond funds and dividend funds. Which of the following statements is TRUE?
- A. When interest rates rise, the net asset value per unit (NAVPU) of bond funds decreases; whereas with dividend funds it rises.
- B. Bond funds receive fixed interest payments from most of their investments.
- C. Bond fund distributions receive more favorable tax treatment than that of dividend funds.
- D. The return of dividend funds relies only on interest rates; whereas with bond funds, the return also depends on the general direction of stock markets.
Answer: B
NEW QUESTION # 33
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