IFSE Institute CIFC Exam Questions in PDF and Online

QUESTION: 25

Exchange traded funds (ETFs) that track an index and index mutual funds have many similarities. However, what is a major difference between these two products?

While ETFs are prone to tracking errors, index funds are perfectly aligned with their underlying index.
ETFs can be purchased continuously throughout the trading day while index funds can only be bought or sold at the end of the day.
The market price of ETFs always matches the underlying basket of securities while there can be a discrepancy in pricing index funds.
ETFs do not have management fees since they are exchange traded while index funds do incur such fees.

Answer(s): B

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Darryl has a diversified investment portfolio of mutual funds in a non-registered account with Investwell Mutual Funds, a mutual fund dealer. Darryl's diversified portfolio is composed of 3 mutual funds. Each mutual fund is currently worth about $100,000. The ABC Canadian Equity Fund has a total return of 6%, the DEF Bond Fund has a total return of 8% and GHI Global Equity Fund has a total return of 10%. Darryl wants to make an in-kind contribution to his registered retirement savings plan (RRSP) account. He has unused RRSP contribution room of $60,000.

From a tax-efficient viewpoint, which funds contribute in-kind to his RRSP account?

Move the DEF Bond Fund to the RRSP.
Move the GHI Global Equity Fund to the RRSP
Move $20,000 from each of the three funds to the RRSP.
Move the ABC Canadian Equity Fund to the RRSP.

Answer(s): A

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QUESTION: 27

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?

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.
When interest rates rise, the net asset value per unit (NAVPU) of bond funds decreases; whereas with dividend funds it rises.
Bond funds receive fixed interest payments from most of their investments.
Bond fund distributions receive more favorable tax treatment than that of dividend funds.

Answer(s): C

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QUESTION: 28

Which of the following statements is true when comparing fund of funds to traditional mutual funds?

Fund of funds have higher fees than traditional mutual funds since there are two sets of management fees.
Fund of funds have more asset class options available and lower fees than traditional mutual funds.
Since fund of funds invest primarily outside Canada, they will have higher fees than traditional mutual funds.
Fund of funds have more fee structure options available and lower fees than traditional mutual funds.

Answer(s): A

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QUESTION: 29

At the close of business, Great Lengths Equity Fund had total assets of $135 million and total liabilities of $10 million. They had 11 million units outstanding. In addition, their current assets totalled $13 million and current liabilities were $3 million.
Which of the following statements regarding Great Lengths Equity Fund's net asset value per unit (NAVPU) is correct?

The NAVPU is the total liabilities divided by the number of outstanding units.
Current assets and current liabilities are used in the NAVPU calculation.
There is not enough information available to calculate the NAVPU.
Great Lengths Equity Fund's NAVPU is $11.36.

Answer(s): D

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QUESTION: 30

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?

Retirement benefits will be based on a prescribed formula that can be referenced from the plan's terms and conditions.
The employer will solely make contributions to her DCPP based on a prescribed formula noted within her plan.
Her available registered retirement savings plan (RRSP) contribution room will be reduced by what is being contributed to her plan.
To ensure she has savings at retirement, the employer will choose stable investments to grow her retirement savings.

Answer(s): C

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QUESTION: 31

Which of the following statements best describes dollar-cost averaging?

It is a type of systematic withdrawal program.
It is buying a set dollar amount of a mutual fund on a regular basis
It is the strategy of purchasing a set number of units of a mutual fund on a regular basis.
It is making lump-sum purchases when the market price for a mutual fund is low.

Answer(s): B

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QUESTION: 32

Which statement regarding the underwriting process and over-the-counter (OTC) markets is CORRECT?

Corporations must have their shares listed both on an exchange and the OTC market during the underwriting process.
During the underwriting process investment bankers raise investment capital from investors on behalf of corporations and governments issuing securities.
Many new stock issues that are underwritten by securities firms are first listed on a stock exchange before they are sold over-the-counter.
The disclosure standards for stock exchanges are not as stringent as those imposed by the OTC market.

Answer(s): B

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IFSE Institute Canadian Investment Funds Course CIFC Exam Questions in PDF

Free IFSE Institute CIFC Dumps Questions (page: 4)

QUESTION: 25

QUESTION: 26

QUESTION: 27

QUESTION: 28

QUESTION: 29

QUESTION: 30

QUESTION: 31

QUESTION: 32