CISI: Securities Exam 2026 Questions
and Answers
What is the difference between cross rate and direct rate? (2) - Correct answer-A
direct rate involves one domestic currency, while a cross rate involves two foreign
currencies that are calculated through a third currency eg (EUR/JPY, GBP/AUD,
AUD/NZD, and USD/CHF)
What are French gov bonds called, when are coupon interest payments paid and
when is settlement? (2) - Correct answer-OATs, PAID ANNUALLY and T+2
What are the different German gov bonds called, when are the interest payments
paid, and when is settlement? (2) - Correct answer-- Schatz < 2 years
- Bobl 5 years
- Bund > 10 years
PAID ANNUALLY
T+2
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,What are the names of the different US bonds, their maturities, and their
settlement? (2) - Correct answer-- T-bills, less than a year and T+0
- T-notes, 2-10 years and T+1
- T-bonds, > 10 years and T+1
What is meant by ex-dividend?(2) - Correct answer-This is the day on which a
stock begins trading without the dividend. If you buy the stock on or after this day,
you are not entitled to the dividend payment. In other words, the stock is trading
"ex" or "without" the dividend.
What is meant by cum-dividend?(2) - Correct answer-This is the opposite of ex-
dividend. It refers to a stock that is trading with the dividend included. If you buy
the stock before the ex-dividend date, you are entitled to receive the dividend
payment, and the stock is said to be trading "cum" or "with" the dividend.
What's the difference between floating and fixed charge? (2) - Correct answer-A
floating charge is created over a changing pool of assets, while a fixed charge is
created over specific assets that cannot be sold or used without the lender's consent
until the debt is fully repaid.
What are bonds issued with a fixed charge referred to as?(2) - Correct answer-
Debenture
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, What is the purpose of an SPV?(2) - Correct answer-A legal entity is set up for a
specific purpose or project to limit risk exposure and protect the interests of
investors or lenders. They can hold assets, enter contracts, and raise capital
independently of the sponsor.
What are covered bonds?(2) - Correct answer-Debt securities backed by a pool of
high-quality assets, like mortgages or public sector loans. They are issued by banks
and other financial institutions and are considered lower-risk investments because
they are backed by assets that generate steady cash flows.
What are the different types of trustees in structured finance transactions?(2) -
Correct answer-- Note trustees: Represent the interests of securities holders.
- Security trustees: Hold securities or properties for the benefit of secured parties.
- Share trustees: Hold shares in an issuing SPV to ensure off-balance-sheet
treatment.
- Successor trustees: Replace a trustee with conflicts of interest or cannot continue
due to work requirements.
What are the three tiers of debt?(2) - Correct answer-- Senior debt: This is the
highest-ranking debt, which has priority over all other debt and must be repaid first
in the event of default.
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and Answers
What is the difference between cross rate and direct rate? (2) - Correct answer-A
direct rate involves one domestic currency, while a cross rate involves two foreign
currencies that are calculated through a third currency eg (EUR/JPY, GBP/AUD,
AUD/NZD, and USD/CHF)
What are French gov bonds called, when are coupon interest payments paid and
when is settlement? (2) - Correct answer-OATs, PAID ANNUALLY and T+2
What are the different German gov bonds called, when are the interest payments
paid, and when is settlement? (2) - Correct answer-- Schatz < 2 years
- Bobl 5 years
- Bund > 10 years
PAID ANNUALLY
T+2
©COPYRIGHT 2025, ALL RIGHTS RESERVED 1
,What are the names of the different US bonds, their maturities, and their
settlement? (2) - Correct answer-- T-bills, less than a year and T+0
- T-notes, 2-10 years and T+1
- T-bonds, > 10 years and T+1
What is meant by ex-dividend?(2) - Correct answer-This is the day on which a
stock begins trading without the dividend. If you buy the stock on or after this day,
you are not entitled to the dividend payment. In other words, the stock is trading
"ex" or "without" the dividend.
What is meant by cum-dividend?(2) - Correct answer-This is the opposite of ex-
dividend. It refers to a stock that is trading with the dividend included. If you buy
the stock before the ex-dividend date, you are entitled to receive the dividend
payment, and the stock is said to be trading "cum" or "with" the dividend.
What's the difference between floating and fixed charge? (2) - Correct answer-A
floating charge is created over a changing pool of assets, while a fixed charge is
created over specific assets that cannot be sold or used without the lender's consent
until the debt is fully repaid.
What are bonds issued with a fixed charge referred to as?(2) - Correct answer-
Debenture
©COPYRIGHT 2025, ALL RIGHTS RESERVED 2
, What is the purpose of an SPV?(2) - Correct answer-A legal entity is set up for a
specific purpose or project to limit risk exposure and protect the interests of
investors or lenders. They can hold assets, enter contracts, and raise capital
independently of the sponsor.
What are covered bonds?(2) - Correct answer-Debt securities backed by a pool of
high-quality assets, like mortgages or public sector loans. They are issued by banks
and other financial institutions and are considered lower-risk investments because
they are backed by assets that generate steady cash flows.
What are the different types of trustees in structured finance transactions?(2) -
Correct answer-- Note trustees: Represent the interests of securities holders.
- Security trustees: Hold securities or properties for the benefit of secured parties.
- Share trustees: Hold shares in an issuing SPV to ensure off-balance-sheet
treatment.
- Successor trustees: Replace a trustee with conflicts of interest or cannot continue
due to work requirements.
What are the three tiers of debt?(2) - Correct answer-- Senior debt: This is the
highest-ranking debt, which has priority over all other debt and must be repaid first
in the event of default.
©COPYRIGHT 2025, ALL RIGHTS RESERVED 3
