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Segregated Funds And Annuities Exam Version 2 And
Practice Exam Newest 2026/2027 Exam Complete 300
Questions And Correct Detailed Answers (Verified
Answers) |Already Graded A+||Newest Exam!!!
What is a back-end load (deferred sales charge, DSC)? -
ANSWER-A sales charge applied upon redemption of the
fund, which has not been available since 2022.
What is the main risk associated with investing in GICs? -
ANSWER-Inflation risk.
What is a short-term trading fee in mutual funds? -
ANSWER-A fee that the client may have to pay if he
makes a change quickly after his initial deposit.
What determines the frequent trading fee for mutual
funds? - ANSWER-It depends on how many transactions
the client makes in a particular time.
What is a trailer fee? - ANSWER-A commission paid by a
fund company to financial brokers for selling the fund to
investors and for ongoing services.
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What is a Front-End Load (FEL) Sales Charge? -
ANSWER-An upfront fee (0-5%) deducted from the
investment, paid to the agent, with no withdrawal fee.
What is a Back-End Load or Deferred Sales Charge
(DSC)? - ANSWER-A fee applied when units of the fund
are sold; however, DSC is no longer applied.
What is a Fee for Service in mutual funds? - ANSWER-A
regular fee, usually a percentage of the investment,
negotiated between the client and agent.
What is a No Load/FEL Zero Sales Charge? - ANSWER-
No upfront fee; trailing commission paid to the agent.
What is an early withdrawal fee? - ANSWER-A penalty
charged when money is taken from a fund before 90 days.
What is an Advisor Chargeback? - ANSWER-No initial
charge, but upfront and trailing commissions are paid to
the agent, who must repay part of the commission if early
withdrawal occurs.
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How are mutual fund investment risk levels categorized? -
ANSWER-Based on standard deviation (SD): 0-6 = low, 6-
11 = low-medium, 11-16 = medium, 16-20 = medium to
high, >20 = high.
What are some advantages of mutual funds? - ANSWER-
Wide variety of funds, ease of investment, massive
information availability, diversification, professional
management, liquidity, ease of switching funds, and ease
of redeeming units.
What are some disadvantages of mutual funds? -
ANSWER-Not suitable for short-term investments, tax
complexities in non-registered accounts, trailing
commissions paid to sales agents, no protection for
market losses.
What types of mutual funds exist? - ANSWER-Money
market funds, fixed-income, equity, balanced, commodity,
and other types.
What is the Net Asset Value (NAV) per unit? - ANSWER-
The fund value divided by the number of outstanding units.
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What does it mean when a bond is selling at a discount? -
ANSWER-It means the market price of the bond falls
below its face value.
What are the main risks of investing in bonds? -
ANSWER-Interest rate risk, reinvestment risk, inflation
risk, credit risk, and liquidity risk.
How does interest rate risk affect bond prices? -
ANSWER-As interest rates rise, bond prices fall, causing
existing bonds' market prices to drop.
What are the advantages of savings accounts? -
ANSWER-Available cash, benefit of interest, and ease of
opening, depositing, and withdrawing.
What are the disadvantages of savings accounts? -
ANSWER-Interest rates may be lower than inflation rates,
and interest earned is fully taxable.
What is a Guaranteed Investment Certificate (GIC)? -
ANSWER-A term deposit that pays interest on the
invested capital, with guaranteed principal and interest at
maturity.
Segregated Funds And Annuities Exam Version 2 And
Practice Exam Newest 2026/2027 Exam Complete 300
Questions And Correct Detailed Answers (Verified
Answers) |Already Graded A+||Newest Exam!!!
What is a back-end load (deferred sales charge, DSC)? -
ANSWER-A sales charge applied upon redemption of the
fund, which has not been available since 2022.
What is the main risk associated with investing in GICs? -
ANSWER-Inflation risk.
What is a short-term trading fee in mutual funds? -
ANSWER-A fee that the client may have to pay if he
makes a change quickly after his initial deposit.
What determines the frequent trading fee for mutual
funds? - ANSWER-It depends on how many transactions
the client makes in a particular time.
What is a trailer fee? - ANSWER-A commission paid by a
fund company to financial brokers for selling the fund to
investors and for ongoing services.
,2|Page
What is a Front-End Load (FEL) Sales Charge? -
ANSWER-An upfront fee (0-5%) deducted from the
investment, paid to the agent, with no withdrawal fee.
What is a Back-End Load or Deferred Sales Charge
(DSC)? - ANSWER-A fee applied when units of the fund
are sold; however, DSC is no longer applied.
What is a Fee for Service in mutual funds? - ANSWER-A
regular fee, usually a percentage of the investment,
negotiated between the client and agent.
What is a No Load/FEL Zero Sales Charge? - ANSWER-
No upfront fee; trailing commission paid to the agent.
What is an early withdrawal fee? - ANSWER-A penalty
charged when money is taken from a fund before 90 days.
What is an Advisor Chargeback? - ANSWER-No initial
charge, but upfront and trailing commissions are paid to
the agent, who must repay part of the commission if early
withdrawal occurs.
,3|Page
How are mutual fund investment risk levels categorized? -
ANSWER-Based on standard deviation (SD): 0-6 = low, 6-
11 = low-medium, 11-16 = medium, 16-20 = medium to
high, >20 = high.
What are some advantages of mutual funds? - ANSWER-
Wide variety of funds, ease of investment, massive
information availability, diversification, professional
management, liquidity, ease of switching funds, and ease
of redeeming units.
What are some disadvantages of mutual funds? -
ANSWER-Not suitable for short-term investments, tax
complexities in non-registered accounts, trailing
commissions paid to sales agents, no protection for
market losses.
What types of mutual funds exist? - ANSWER-Money
market funds, fixed-income, equity, balanced, commodity,
and other types.
What is the Net Asset Value (NAV) per unit? - ANSWER-
The fund value divided by the number of outstanding units.
, 4|Page
What does it mean when a bond is selling at a discount? -
ANSWER-It means the market price of the bond falls
below its face value.
What are the main risks of investing in bonds? -
ANSWER-Interest rate risk, reinvestment risk, inflation
risk, credit risk, and liquidity risk.
How does interest rate risk affect bond prices? -
ANSWER-As interest rates rise, bond prices fall, causing
existing bonds' market prices to drop.
What are the advantages of savings accounts? -
ANSWER-Available cash, benefit of interest, and ease of
opening, depositing, and withdrawing.
What are the disadvantages of savings accounts? -
ANSWER-Interest rates may be lower than inflation rates,
and interest earned is fully taxable.
What is a Guaranteed Investment Certificate (GIC)? -
ANSWER-A term deposit that pays interest on the
invested capital, with guaranteed principal and interest at
maturity.
