Chapter 1

Question 1

Types of Shares

Answer 1

• Ordinary - can be redeemable, A shares (no voting rights) or deferred (only pay dividend once all others have been paid)
• Preference - entitled to a fix dividend each year there are sufficient profits.
• Cumulative Preference - dividends that can’t be paid in one year are carried over to the following years
• Redeemable - company agrees to buy these back at a certain date

Question 2

Which securities do not pay SDRT (0.5% on any value)

Answer 2

ETFs
AIM
CFDs
Depository Receipts
Gilts or bonds