Canadian Securities Course Exam
Questions and Answers 100% Correct
What does an Investment Dealer do? - ✔✔Acts as intermediaries between
investors and users of capital.
When a Investment Dealer is acting as Primary, what are they doing? -
✔✔Selling securities from their own inventory. Make money via
spread/underwriting.
When an investment dealer is acting as agents, what are they doing? -
✔✔Facilitating a trade between a buyer and seller, without owning the security.
They make money via commissions.
What are the three types of Investment dealers? - ✔✔Retail firms, Institutional
firms, and Integrated firms.
Give a brief description of retail firms. - ✔✔Includes full service investment
dealers and self directed brokers.
Give a brief description of Institutional firms. - ✔✔They serve institutional
clients and organizations that trade large volumes like pension funds.
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©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
,Give a brief description of Integrated firms. - ✔✔Offer products and services
that participate in both retail and institutional markets. Most firms underwrite
debt and equity issues and are active in the secondary markets.
What are the roles of front, middle, and back offices of an investment dealer
firm? - ✔✔Front Office: Portfolio management, Trading, Sales, Marketing.
Middle Office: Compliance, Accounting, Audits, Legal
Back Office: Trade settlement.
What services do investment dealers provide? - ✔✔They provide advice about
new issues, They act as market makers, They buy stocks as principal becoming
more competitive in serving their institutional clients, They add liquidity to
secondary markets which enhances the primary markets.
What is a Market Maker - ✔✔A trader that maintains liquidity in securities
markets by taking large positions to enhance liquidity and sooth out price
distortions.
What does the Clearing and Depository Services (CDS) do? - ✔✔It clears security
transactions daily using a process called netting to establish and confirm a credit
or debit position.
What are the three types of chartered banks? - ✔✔Schedule I,II, & III banks
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©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
,Describe Schedule I Banks - ✔✔Banks such as TD, RBC. They offer loans, savings
and deposits from businesses and consumers. They also sell mutual funds and
other investment options, and mortgages.
Describe Schedule II Banks - ✔✔Such as Citi Canada, AMEX Canada. Are foreign
bank subsidiaries, They do everything schedule I banks do plus commercial
loans to business, issue financial paper in money markets, take deposits for
businesses and sell mutual funds and other investments.
Describe Schedule III Banks - ✔✔Such as Deutsche, Comerica. Most are full
service foreign bank branches of foreign banks and accept deposits, not usually
lending.
What type of bank has strict ownership rules? - ✔✔Schedule I banks ( a single
shareholder cannot own more than 20%).
What is a credit union? - ✔✔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? - ✔✔They
offer term deposits and GIC's, segregated funds and other investment products.
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©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
, What is the most important aspect of insurance companies? - ✔✔Underwriting
(the business of evaluating risk).
What other things do insurance companies have to offer? - ✔✔Life insurance,
home, auto, and commercial insurance.
What is a trust company? - ✔✔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? - ✔✔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? - ✔✔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? - ✔✔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? - ✔✔An investment into an asset. Such as buying a
house, Or the Government investing in a new highway
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©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
Questions and Answers 100% Correct
What does an Investment Dealer do? - ✔✔Acts as intermediaries between
investors and users of capital.
When a Investment Dealer is acting as Primary, what are they doing? -
✔✔Selling securities from their own inventory. Make money via
spread/underwriting.
When an investment dealer is acting as agents, what are they doing? -
✔✔Facilitating a trade between a buyer and seller, without owning the security.
They make money via commissions.
What are the three types of Investment dealers? - ✔✔Retail firms, Institutional
firms, and Integrated firms.
Give a brief description of retail firms. - ✔✔Includes full service investment
dealers and self directed brokers.
Give a brief description of Institutional firms. - ✔✔They serve institutional
clients and organizations that trade large volumes like pension funds.
1|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
,Give a brief description of Integrated firms. - ✔✔Offer products and services
that participate in both retail and institutional markets. Most firms underwrite
debt and equity issues and are active in the secondary markets.
What are the roles of front, middle, and back offices of an investment dealer
firm? - ✔✔Front Office: Portfolio management, Trading, Sales, Marketing.
Middle Office: Compliance, Accounting, Audits, Legal
Back Office: Trade settlement.
What services do investment dealers provide? - ✔✔They provide advice about
new issues, They act as market makers, They buy stocks as principal becoming
more competitive in serving their institutional clients, They add liquidity to
secondary markets which enhances the primary markets.
What is a Market Maker - ✔✔A trader that maintains liquidity in securities
markets by taking large positions to enhance liquidity and sooth out price
distortions.
What does the Clearing and Depository Services (CDS) do? - ✔✔It clears security
transactions daily using a process called netting to establish and confirm a credit
or debit position.
What are the three types of chartered banks? - ✔✔Schedule I,II, & III banks
2|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
,Describe Schedule I Banks - ✔✔Banks such as TD, RBC. They offer loans, savings
and deposits from businesses and consumers. They also sell mutual funds and
other investment options, and mortgages.
Describe Schedule II Banks - ✔✔Such as Citi Canada, AMEX Canada. Are foreign
bank subsidiaries, They do everything schedule I banks do plus commercial
loans to business, issue financial paper in money markets, take deposits for
businesses and sell mutual funds and other investments.
Describe Schedule III Banks - ✔✔Such as Deutsche, Comerica. Most are full
service foreign bank branches of foreign banks and accept deposits, not usually
lending.
What type of bank has strict ownership rules? - ✔✔Schedule I banks ( a single
shareholder cannot own more than 20%).
What is a credit union? - ✔✔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? - ✔✔They
offer term deposits and GIC's, segregated funds and other investment products.
3|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
, What is the most important aspect of insurance companies? - ✔✔Underwriting
(the business of evaluating risk).
What other things do insurance companies have to offer? - ✔✔Life insurance,
home, auto, and commercial insurance.
What is a trust company? - ✔✔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? - ✔✔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? - ✔✔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? - ✔✔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? - ✔✔An investment into an asset. Such as buying a
house, Or the Government investing in a new highway
4|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
