2024 CANADIAN SECURITIES COURSE EXAM
QUESTIONS & CORRECT ANSWERS
What is a credit union? - ANSWER-They often cater to member-savers from
common interest groups and provide deposit taking services, lending, mortgages,
insurance, mutual funds, debt and credit cards.
What role do insurance companies play in the financial markets? - ANSWER-They
offer term deposits and GIC's, segregated funds and other investment products.
What is the most important aspect of insurance companies? - ANSWER-
Underwriting (the business of evaluating risk).
What other things do insurance companies have to offer? - ANSWER-Life
insurance, home, auto, and commercial insurance.
What is a trust company? - ANSWER-They act as a trustee in charge of corporate
and individual assets such as property. stocks, and bonds.
What is the purpose of an investment fund? - ANSWER-They are companies or
trusts that sell shares or units to the public and invest the proceeds in a diverse
securities portfolio.
What are the two types of government-related pension funds? - ANSWER-Defined
Benefit (provides employees with a pre-determined specified payment amount
when they retire) and Defined Contribution plans (Allows employees to contribute
to a plan that invests funds over time).
,What is a Robo-Advisor? - ANSWER-It provides clients with advice with goal
based online investment management, creates portfolios using algos based on
theory and questions. Usually built with ETF's.
What is a direct investment? - ANSWER-An investment into an asset. Such as
buying a house, Or the Government investing in a new highway
What is an indirect investment? - ANSWER-When you buy representational items
such as stock, or depositing into a savings account.
What does an investment advisor do? - ANSWER-Helps individuals or entities
invest in indirect investments.
What are the 3 characteristics of capital? - ANSWER-Mobility, sensitivity, and
scarcity.
What are some things you should consider when evaluating a country's risk? -
ANSWER-The political environment, economic trends, fiscal and monetary policy,
investment opportunities, and the labor force.
Who are the supplier of capital? - ANSWER-Individuals, Governments, Non-
financial Investors, foreign investors.
Who are the users of capital? - ANSWER-Individuals, businesses, and
governments.
What are fixed-income securities (debt securities)? Give an example of one. -
ANSWER-When the issuer agrees to repay a loan at maturity date, and make
interest payments to investors. Ex Bonds, Tbills
,What is an equity security? Give an example of one. - ANSWER-shares that
represent ownership in the company that issued them. Ex Stocks, preferred shares.
What role does the financial market play in Canada? - ANSWER-It provides a
place where buyers and sellers meet to ensure an efficient transfer of capital. There
is no physical location, it all takes place online.
What are the individual financial markets that make up the capital markets? -
ANSWER-Stock markets, bond markets, and money markets.
What other ways can the capital market be categorized as? - ANSWER-Primary,
secondary, and auction markets.
What is the purpose of primary markets? - ANSWER-It is where newly issued
securities are sold.
What is the purpose of secondary markets? - ANSWER-Where investors trade
securities that are already been issued by companies.
What is an auction market? - ANSWER-Where investment dealers act as agents
execute buy & sell orders on behalf of their clients.
What is a Dealer (OTC) market? - ANSWER-It is a negotiated market where
market makers post bid-ask quotes. Consists of banks and investment dealers who
act as principal. Almost all bonds and debentures are sold here.
What are the 5 exchanges in Canada? - ANSWER-TSX, TSX.V, Montreal
Exchange, Canadian securities exchange, NEO Exchange.
, What is an Alternative Trading System (ATS)? - ANSWER-Are electronic
marketplaces that provide automated matching and execution of trades in both
equity and fixed-income markets.
What is CanDeal? - ANSWER-It is a joint venture between Canada's 6 largest
bank-owned investment dealers.
What is CBID? - ANSWER-It is an ATS that operates 2 types of fixed-income
marketplaces, retail and institutional.
What is CanPX? - ANSWER-It is a joint venture between several Canadian
investment dealers that provides real time Bid and ask quotes in price and yield
terms for Government of Canada Tbills.
Who regulates the financial sector in Canada? - ANSWER-The Office of the
Superintendent of Financial Institutions (OSFI).
What is the job of the Canadian Securities Administration (CSA)? - ANSWER-It is
an umbrella organization of Canada's securities regulators designed to harmonize
regulation of the Canadian capital markets.
What is a Self Regulatory Organization(SRO)? - ANSWER-SRO's are private
industry organizations that provincial regulatory bodies have granted the privilege
of regulating their own members. They have their own rules and requirements.
Who monitors SRO's? - ANSWER-The Canadian Securities Administration
(CSA).
QUESTIONS & CORRECT ANSWERS
What is a credit union? - ANSWER-They often cater to member-savers from
common interest groups and provide deposit taking services, lending, mortgages,
insurance, mutual funds, debt and credit cards.
What role do insurance companies play in the financial markets? - ANSWER-They
offer term deposits and GIC's, segregated funds and other investment products.
What is the most important aspect of insurance companies? - ANSWER-
Underwriting (the business of evaluating risk).
What other things do insurance companies have to offer? - ANSWER-Life
insurance, home, auto, and commercial insurance.
What is a trust company? - ANSWER-They act as a trustee in charge of corporate
and individual assets such as property. stocks, and bonds.
What is the purpose of an investment fund? - ANSWER-They are companies or
trusts that sell shares or units to the public and invest the proceeds in a diverse
securities portfolio.
What are the two types of government-related pension funds? - ANSWER-Defined
Benefit (provides employees with a pre-determined specified payment amount
when they retire) and Defined Contribution plans (Allows employees to contribute
to a plan that invests funds over time).
,What is a Robo-Advisor? - ANSWER-It provides clients with advice with goal
based online investment management, creates portfolios using algos based on
theory and questions. Usually built with ETF's.
What is a direct investment? - ANSWER-An investment into an asset. Such as
buying a house, Or the Government investing in a new highway
What is an indirect investment? - ANSWER-When you buy representational items
such as stock, or depositing into a savings account.
What does an investment advisor do? - ANSWER-Helps individuals or entities
invest in indirect investments.
What are the 3 characteristics of capital? - ANSWER-Mobility, sensitivity, and
scarcity.
What are some things you should consider when evaluating a country's risk? -
ANSWER-The political environment, economic trends, fiscal and monetary policy,
investment opportunities, and the labor force.
Who are the supplier of capital? - ANSWER-Individuals, Governments, Non-
financial Investors, foreign investors.
Who are the users of capital? - ANSWER-Individuals, businesses, and
governments.
What are fixed-income securities (debt securities)? Give an example of one. -
ANSWER-When the issuer agrees to repay a loan at maturity date, and make
interest payments to investors. Ex Bonds, Tbills
,What is an equity security? Give an example of one. - ANSWER-shares that
represent ownership in the company that issued them. Ex Stocks, preferred shares.
What role does the financial market play in Canada? - ANSWER-It provides a
place where buyers and sellers meet to ensure an efficient transfer of capital. There
is no physical location, it all takes place online.
What are the individual financial markets that make up the capital markets? -
ANSWER-Stock markets, bond markets, and money markets.
What other ways can the capital market be categorized as? - ANSWER-Primary,
secondary, and auction markets.
What is the purpose of primary markets? - ANSWER-It is where newly issued
securities are sold.
What is the purpose of secondary markets? - ANSWER-Where investors trade
securities that are already been issued by companies.
What is an auction market? - ANSWER-Where investment dealers act as agents
execute buy & sell orders on behalf of their clients.
What is a Dealer (OTC) market? - ANSWER-It is a negotiated market where
market makers post bid-ask quotes. Consists of banks and investment dealers who
act as principal. Almost all bonds and debentures are sold here.
What are the 5 exchanges in Canada? - ANSWER-TSX, TSX.V, Montreal
Exchange, Canadian securities exchange, NEO Exchange.
, What is an Alternative Trading System (ATS)? - ANSWER-Are electronic
marketplaces that provide automated matching and execution of trades in both
equity and fixed-income markets.
What is CanDeal? - ANSWER-It is a joint venture between Canada's 6 largest
bank-owned investment dealers.
What is CBID? - ANSWER-It is an ATS that operates 2 types of fixed-income
marketplaces, retail and institutional.
What is CanPX? - ANSWER-It is a joint venture between several Canadian
investment dealers that provides real time Bid and ask quotes in price and yield
terms for Government of Canada Tbills.
Who regulates the financial sector in Canada? - ANSWER-The Office of the
Superintendent of Financial Institutions (OSFI).
What is the job of the Canadian Securities Administration (CSA)? - ANSWER-It is
an umbrella organization of Canada's securities regulators designed to harmonize
regulation of the Canadian capital markets.
What is a Self Regulatory Organization(SRO)? - ANSWER-SRO's are private
industry organizations that provincial regulatory bodies have granted the privilege
of regulating their own members. They have their own rules and requirements.
Who monitors SRO's? - ANSWER-The Canadian Securities Administration
(CSA).
