Efficiently Prepare for Your Canadian Investment Funds Course (CIFC) Exam with Updated CIFC Dumps (V9.02): Read CIFC Free Dumps (Part 1, Q1-Q40) to Check the Quality

1. Xian-Li believes she is a sophisticated investor. She has constructed her own portfolio and has had some success. She does not believe in studying a company’s details such as earnings, expenses, or assets. She is more concerned with patterns in a company’s stock price over time. She believes patterns form and can be used to predict future movements in the market.

How does Xian-Li evaluate the companies in her portfolio?

2. Yesterday, Mariana purchased mutual funds for the first time from Diablo, who is a Dealing Representative for Horizon Financial. When Mariana mentions to her friend Marcus that she just started to invest, Marcus confides that he experienced losses from mutual fund investing. Her initial feelings of excitement have now changed to worry and regret. She wished she had talked to her friend before investing and wonders if she can change her mind.

Which statement regarding the right of withdrawal applies?

3. Iliana owns 1,000 participating preferred shares in the First Canadian Bank.

Which of the following features are characteristic of her investment?

4. Wilma has always used the services of a tax preparation firm to file her taxes but is skeptical that she has really benefitted. This year she plans to file her own taxes for the first time.

What would be useful for her to know?

5. One of your clients, Fernando, is approaching 71 years of age and has a few questions regarding life income funds (LIFs).

Which of the following statements about LIFs is TRUE?

6. Janine will celebrate her 71st birthday this year. She currently has a lot of money in a personal registered retirement savings plan (RRSP) and knows there are rules about what she can do with those funds.

Which of the following is TRUE?

7. With respect to the tax treatment of dividends received from a taxable Canadian corporation, which of the following statements is CORRECT?

8. What information does Fund Facts provide to potential investors?

9. You have been researching Canadian equity mutual funds for a new client.

You come across the following information.

What can you conclude from this information?

10. Gershon is a Dealing Representative and he opens a new account for his client, Isaac. Gershon collects the necessary information from Isaac in order to designate the Trusted Contact Person (TCP) for Isaac’s account.

Which of the following statements about Isaac’s TCP is CORRECT?

11. When you buy a put option, which of the following is TRUE?

12. David had $10,000 in his investment account with Dynamic Investments, a mutual funds dealer. On June 28, David wants to buy 500 units in ABC Canadian Dividend Fund that has a Net Asset Value Per Unit (NAVPU) of $14.10. His friend Robert suggests that he may get a better price if he used the strategy of dollar-cost averaging. David then instructs his Dealing Representative to place a purchase order for 100 units on the first of every month starting July 1st for the next 5 months.

The orders are executed at the following NAVPUs.

July 01, $14.00

Aug. 01, $14.50

Sep. 01, $15.00

Oct. 01, $14.25

Nov. 01, $16.50

Did David get a better purchase price following the dollar-cost averaging strategy compared to making a lump-sum purchase of 500 shares on Jun 28, 20xx?

13. Your client, Helen, just received her non-registered account statement which states that one of her mutual funds made an interest income distribution during the year. She asks you how she will be taxed on the distribution.

What do you tell Helen?

14. Quinton, a Dealing Representative, meets with his client Banji. Banji’s Know Your Client (KYC) indicates that her risk profile is “medium’’. Banji currently has $35,000 in her account which is invested 50% in the Middleton Balanced Fund and 50% in the Hector Growth Fund. She tells Quinton that she would like to contribute an additional $10,000 to purchase the Prospect Labour-Sponsored Fund.

Which of the following statements about Banji’s proposed transaction is CORRECT?

15. What type of mutual fund can invest in specified derivatives and forward contracts for grains, meats, metals, energy products, and coffee?

16. When comparing mutual funds, what information would help a Dealing Representative determine a suitable mutual fund for a client?

17. Francis wants to redeem his US Asset Allocation Fund as he needs the money for a down payment for a home purchase. The current proceeds from the redemption are USD $27,859, and the current CAD/USD exchange rate is 0.7353.

How much will Francis receive in Canadian dollars when he redeems the Funds? Please round your answer to the nearest dollar.

18. The owners of Underground Airways Ltd. want to take their privately owned corporation public through an initial public offering (IPO). They are speaking to a specialist from an investment dealer to determine whether it would be advisable to become listed on a stock exchange or the over-the-counter (OTC) market.

In comparing the two options, which of the following considerations is TRUE?

19. Sven owns preferred shares that give him the option to sell his holdings back to the issuing company at a predetermined price and within a specified time.

What type of preferred shares does Sven own?

20. Which of the following characteristics about mortgage mutual funds is CORRECT?

21. Which of the following statements about capital gains distributions from mutual fund trusts is correct?

22. Which of the following is a rationale for a portfolio manager to use a passive portfolio management strategy?

23. Your client, Rinaldo, wants to know more about the fees associated with his mutual funds.

What can you tell him about a mutual fund’s management expense ratio (MER)?

24. Sujay contributes 3% of his $60,000 salary to his employer’s defined contribution pension plan. His employer contributes the same amount to the plan.

How will this affect his registered retirement savings plan (RRSP) contribution room for the year?

25. Exchange traded funds (ETFs) that track an index and index mutual funds have many similarities.

However, what is a major difference between these two products?

26. Darryl has a diversified investment portfolio of mutual funds in a non-registered account with Investwell Mutual Funds, a mutual fund dealer. Darryl’s diversified portfolio is composed of 3 mutual funds. Each mutual fund is currently worth about $100,000. The ABC Canadian Equity Fund has a total return of 6%, the DEF Bond Fund has a total return of 8% and GHI Global Equity Fund has a total return of 10%. Darryl wants to make an in-kind contribution to his registered retirement savings plan (RRSP) account. He has unused RRSP contribution room of $60,000.

From a tax-efficient viewpoint, which funds contribute in-kind to his RRSP account?

27. Danica is looking for a mutual fund to hold in her non-registered account that provides a regular stream of income with potential for capital growth. She is having difficulty distinguishing between bond funds and dividend funds.

Which of the following statements is TRUE?

28. Which of the following statements is true when comparing fund of funds to traditional mutual funds?

29. At the close of business, Great Lengths Equity Fund had total assets of $135 million and total liabilities of $10 million. They had 11 million units outstanding. In addition, their current assets total led $13 million and current liabilities were $3 million.

Which of the following statements regarding Great Lengths Equity Fund’s net asset value per unit (NAVPU) is correct?

30. Sandra presently participates in her employer-sponsored defined contribution pension plan (DCPP).

As contributions continue to be made into her plan, what can she expect?

31. Which of the following statements best describes dollar-cost averaging?

32. Which statement regarding the underwriting process and over-the-counter (OTC) markets is CORRECT?

33. Maureen is 65 years old and will be retiring soon. She has a modest portfolio of mutual funds that focus on growth. As she approaches retirement, Maureen wants to switch to investments that provide steady income with low to medium risk.

Given Maureen’s wishes, which of the following mutual funds would be suitable for her?

34. Which of the following statements about your mutual fund registration is CORRECT?

35. Greg, one of your clients, has been advised by a friend to invest in open-end mutual funds. He is not sure about the differences between open and closed-end funds.

What would you tell Greg about open-end funds?

36. Pierre buys a call option on a stock.

What is the implication of this transaction?

37. Your clients, Philip and Helen, have a disabled son, Alex, age 22. They want to set up a registered disability savings plan (RDSP) for Alex and have asked you for some information.

Which statement is TRUE?

38. Karen’s know your client (KYC) profile corresponds to someone who has a long time horizon, is comfortable with risk and volatility, and is primarily interested in growth. She watches the daily movements of the Toronto Stock Exchange (TSX) and wants a mutual fund that will closely match what she sees.

What kind of mutual fund would be BEST for her?

39. Which of the following statement about Exchange Traded Funds (ETFs) is TRUE?

40. Eleanora receives a $500 eligible Canadian dividend from her mutual fund. Her federal marginal tax rate for the year is 29%.

Assuming the enhanced gross-up of 38% and a federal dividend tax credit of 15.02%, how much federal tax will she pay on her dividend?