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Functions of the Financial System
Which of the following is NOT taking the role of a lender in the financial system?
Functions of the Financial System
Which of the following is a pre-requisite for capital allocation efficiency?
Assets, Contracts and Markets
In the event of a company liquidation, what is the priority of payments to parties involved? Sort from the highest to lowest priority (drag and drop).
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Assets, Contracts and Markets
QPR fund is a pooled investment fund in which its investors trade the fund in the secondary market. The fund prices is always very close to its Net Asset Valuation (NAV). Which type of fund is QPR most likely to be?
Assets, Contracts and Markets
A food processing company is concerned about the volatility of wheat prices, and would like to have long-term security such that it gets its supply of wheat at a fixed price. Which of the following contracts is the most appropriate for this purpose?
Assets, Contracts and Markets
Anthony is a market speculator and often makes very short-term trades on gold. Which type of market is the most suitable for Anthony?
Financial Intermediaries
Peter owns 15% of a public-listed company and would like to sell all his shares. Which of the following is the most appropriate action that he should take?
Financial Intermediaries
Which of the following is mostly likely NOT a benefit of investing in Asset-backed Securities (ABS)?
Financial Intermediaries
Mario purchases high coverage for his health insurance because he knows that his family history is going to lead to high healthcare costs. Which of the following best describes this kind of risk to insurance companies?
Financial Intermediaries
Which of the following is likely NOT a role of a clearinghouse?
Positions and Leverage
Which of the following hedgers should take the short position?
Emily bought ABC stock at $20,000. She placed the required initial margin of $6,000, and the maintenance margin requirement was 20%. What is the margin call price for Emily’s purchase?
Positions and Leverage
Emily bought ABC stock at $20,000. She placed the required initial margin of $6,000 with a broker which charges 0% commission and 4% call money rate. Two years later, she sold her position in ABC stock for $25,000, and collected $1,500 dividend during the period.
What is Emily’s actual % gain from this transaction?
Order Instructions
The highest bid price for a stock is currently $46.80 and the lowest ask price is currently $47.70.
Monique placed a limit SELL order at $48.00. What is the most appropriate terminology for Monique’s order?
Order Instructions
Channing is a momentum trader and would like to issue an order to buy a stock when it breaks its resistance level. What kind of order should Channing issue?
Primary Markets
IHPT Corp has engaged an investment bank to manage its IPO. IHPT would like to raise $100 million, but the investment bank advised that IHPT may not be able to raise the full amount if the IPO is undersubscribed.
What is the most likely offering for this arrangement?
Secondary Markets and Market Structures
Match the following descriptions to the type of market. (Drag and drop)
Order-Driven Market
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Quote-Driven Market
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Brokered Market
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Secondary Markets and Market Structures
Order (from highest to lowest) the priority in which orders are matched in an order-driven market.
(Drag and drop)
View Answers:
Well-Functioning Financial Systems
Which of the following is not a benefit of a well-functioning financial system?
Market Regulation
The finance minister of LalaLand would like to address widespread overcharging and misleading information in the financial industry. What is the least appropriate action that he should impose?
Why is the language of the Learning Outcome Statements (LOS) different from the curriculum?
The LOS are protected under the CFA Institute's copyright, and we don't have permission to duplicate them verbatim. Therefore, we've rephrased the LOS and included alphabetical labels (a, b, c, …) to simplify cross-referencing with the original LOS in the curriculum when needed.
Now available for all Level I topics! Try it now!
Enter a search term (e.g. ‘LIFO reserve’), or bookmark the glossary page!
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Are you a CFA Level I candidate, or someone who is exploring taking the CFA exam? Four years ago, I was in your shoes. I am a Computer Engineering graduate and have been working as an engineer all my life. Having developed a keen interest in finance, I decided on a career switch to the finance field and enrolled into the CFA program at the same time.
Adjusting to the drastic career change was tough. I naturally neglected the preparation for my Level I exam in June 2014. It was not until the middle of March 2014 that I realized I only had a little more than 2 months to the exam. To compound my problems, I basically did not have a preparation strategy. Having no background in finance at all, I tried very hard to read the curriculum from cover to cover, but eventually that fell flat. I can still recall the number of times I dozed off while studying, or just going back and forth trying to understand even the simplest concept. My mind simply could not keep up after a hard day at work.
Does all these sound familiar to you? Well, take heart. No matter how bleak it seems, at least sit for the exam and treat it as a learning experience. That was basically my attitude as I burrowed through my exam prep with toil and stress. By God’s grace, I did pass my Level I exam in June 2014. It was an experience I would not want to revisit though.
For the Level II exam, I endeavoured not to repeat the mistakes I made. Based on the Pareto 80/20 principle, I learnt to extract the most essential bits from the curriculum enough to give me that 80% result to pass. Being a visual learner, I took notes and summaries in pictorial form. Instead of reserving huge segments of time to study, I carved out pockets of time to learn and practise – accommodating to my full-time job. I managed to pass my Level II and Level III exams consecutively with considerably less effort and stress than when I did my level I.
I love the CFA Program and truly value the skills and ethics that are imparted to make me a better finance professional. My desire is to help candidates who are keen to pursue this path to do so in the most effective and painless process as possible – based on the lessons that I learnt as a candidate. I have set up PrepNuggets with the vision to revolutionise learning by using technology, catering to the short attention span that we can afford. If this makes sense to you, join the PrepNuggets community by signing up for your free student account. I am confident that the materials that we have laboriously crafted will bring you closer to that dream pass with just that 20% effort. Let us do the hard work for you.
Regards,
Keith Tan, CFA
Founder and Chief Instructor
PrepNuggets
Keith is the founder and chief instructor of PrepNuggets. He has a wide range of interests in all things related to tech, from web development to e-learning, gadgets to apps. Keith loves exploring different cultures and the untouched gems around the world. He currently lives in Singapore but frequently travels to share his knowledge and expertise with others.
Have you ever gotten stuck in your study because you can’t remember a formula, or what a specific term means? Now, say goodbye to scanning through all the videos and ploughing through pages and pages just to find what you are looking for. All the important formulas, definitions and diagrams you need for the exam are now at your fingertips at prepnuggets.com/glossary.
What’s more, these quick references are deeply integrated in our lessons, so you get a good idea of what the lesson covers even before watching the video. The references also point you to specific video lessons where it is covered, so you can quickly access the corresponding video to learn more about the term.
Available now for all Level I topics, this service is exclusive for our Premium and Pro members only. We will progressively add the rest of the topic areas over the next few months.
We think this is a game-changer for your CFA success!
Thank you for purchasing one of our courses on Udemy! Now that you have experienced the PrepNuggets way of learning, are you ready to take your exam prep to the next level with us?
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On the 1st of March 2018, we took a bold step of faith to put our Financial Reporting and Analysis (FRA) course on Udemy.
For those of you who are new to Udemy, it is the world’s largest marketplace for online courses. Think of it like the EBay of online courses.
So imagine our trepidation in pitting our course in this highly competitive platform, against the many CFA prep providers already entrenched on the platform.
Overwhelming.
Yes, that’s the word that aptly describes the response to our course from the Udemy community.
The “Best Seller” tag from Udemy is attached to only one best selling course in its category. In just 1 month, our FRA course became the best selling CFA course on the platform. If you do a search for ‘CFA Level 1’, our course comes out on top in the search rankings.
Since the launch on 1 March, we have had more than 250 paid enrolments. While we are heartened by this figure, nothing beats knowing that our course has reached 50 countries around the world! It was simply heartwarming to receive messages from students from countries we barely know about, telling us how much they love the course and their wish that we would produce more of such courses. This certainly spurs us on to produce more materials to ease the burden of CFA candidates worldwide.
As of today, our course has a high average rating of 4.8 out of 5.0. 74% of the reviewers gave us 5 stars! We take this as endorsement that we are doing things right, and will continue in using the Pareto principle approach for our course materials. There are, of course, constructive feedback as well, and we aim to incorporate some of the feedback in producing the upcoming courses.
We are working hard to bring more of our courses to Udemy! We realise some candidates prefer to purchase courses as they need individually, so we endeavour to give more options to our potential students. Check out our Udemy Courses Page to find out which of our courses are available on Udemy for your purchase.
If you have purchased our course on Udemy and would like to continue with the PrepNuggets study approach for other topics, we have an awesome upgrade offer to Premium membership for you!
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