CISI INTRODUCTION TO SECURITIES AND INVESTMENT EXAM
2025-2026
FCA responsibilities? - ANSWER ->The Financial Conduct
Authority is responsible for the day-to-day conduct of firms and
regulating conduct in retail and wholesale markets.
They aim to protect consumers, increase integrity within the
financial sector and maintain efficient and competitive markets
to benefit the consumer.
PRA responsibilities? - ANSWER ->The Prudential Regulation
Authority is responsible for the regulation of prudentially
significant firms that manage high risks on their balance sheets.
(e.g. deposit taking institutions).
Their primary objective is to enhance financial stability by
minimizing disruption to prudential firms.
,FPC responsibilities/roles - ANSWER ->The Financial Policy
Committee are responsible for macro-prudential regulation and
stability and resilience of the financial services sector.
Their role is to protect and enhance financial stability by
removing systemic risk in the financial system.
What are the requirements for listing on the LSE? - ANSWER -
>Must be a public limited company (plc).
Must have a market capitalization of at least £30 million.
Must have been trading for at least 3 years.
Must have at least 10% shares in public hands or available to
the public.
Must show sufficient working capital that can last for at least 12
months.
Call Option - ANSWER ->When the buyer of an option has the
right, but not an obligation to buy the underlying asset at the
exercise price if they choose to. The seller has to provide
delivery but receives a premium for granting the option to the
buyer.
Put Option - ANSWER ->When the buyer of an option has the
right, but not the obligation to sell the underlying asset at the
exercise price if they choose to. The seller is obliged to take
delivery but receives a premium for granting the option to the
buyer.
, What is the ACD and depository responsible for in an OEIC? -
ANSWER ->The Authorised Corporate Director (ACD) is
responsible for the day-to-day management of the investments
in the fund, valuing and pricing the fund, and dealing with
investors.
The Depository is responsible for looking after investments on
behalf of shareholders and overseeing the activities of the ACD.
OEIC definition and other names? - ANSWER ->Collective
investment scheme (CIS) structured as a company, with
investors holding shares. Single and dual pricing strategy used.
Investment Companies with Variable Capital (ICVC)
Societé d'Investment À Capital Variable (SICAV)
Definition/Characteristics of an Investment Trust? - ANSWER -
>It is a listed company on an exchange that has directors and
shareholders. Their diversified investments lead to less risk for
shareholders. They are also allowed to borrow money from the
bank for gearing unlike an OEIC and Unit Trust.
They are closed-ended as the no. of shares remain fixed for
many years.
REIT definition/characteristics? - ANSWER ->Real Estate
Investment Trust.
2025-2026
FCA responsibilities? - ANSWER ->The Financial Conduct
Authority is responsible for the day-to-day conduct of firms and
regulating conduct in retail and wholesale markets.
They aim to protect consumers, increase integrity within the
financial sector and maintain efficient and competitive markets
to benefit the consumer.
PRA responsibilities? - ANSWER ->The Prudential Regulation
Authority is responsible for the regulation of prudentially
significant firms that manage high risks on their balance sheets.
(e.g. deposit taking institutions).
Their primary objective is to enhance financial stability by
minimizing disruption to prudential firms.
,FPC responsibilities/roles - ANSWER ->The Financial Policy
Committee are responsible for macro-prudential regulation and
stability and resilience of the financial services sector.
Their role is to protect and enhance financial stability by
removing systemic risk in the financial system.
What are the requirements for listing on the LSE? - ANSWER -
>Must be a public limited company (plc).
Must have a market capitalization of at least £30 million.
Must have been trading for at least 3 years.
Must have at least 10% shares in public hands or available to
the public.
Must show sufficient working capital that can last for at least 12
months.
Call Option - ANSWER ->When the buyer of an option has the
right, but not an obligation to buy the underlying asset at the
exercise price if they choose to. The seller has to provide
delivery but receives a premium for granting the option to the
buyer.
Put Option - ANSWER ->When the buyer of an option has the
right, but not the obligation to sell the underlying asset at the
exercise price if they choose to. The seller is obliged to take
delivery but receives a premium for granting the option to the
buyer.
, What is the ACD and depository responsible for in an OEIC? -
ANSWER ->The Authorised Corporate Director (ACD) is
responsible for the day-to-day management of the investments
in the fund, valuing and pricing the fund, and dealing with
investors.
The Depository is responsible for looking after investments on
behalf of shareholders and overseeing the activities of the ACD.
OEIC definition and other names? - ANSWER ->Collective
investment scheme (CIS) structured as a company, with
investors holding shares. Single and dual pricing strategy used.
Investment Companies with Variable Capital (ICVC)
Societé d'Investment À Capital Variable (SICAV)
Definition/Characteristics of an Investment Trust? - ANSWER -
>It is a listed company on an exchange that has directors and
shareholders. Their diversified investments lead to less risk for
shareholders. They are also allowed to borrow money from the
bank for gearing unlike an OEIC and Unit Trust.
They are closed-ended as the no. of shares remain fixed for
many years.
REIT definition/characteristics? - ANSWER ->Real Estate
Investment Trust.
