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CFMP > Last Exam > Flashcards

Last Exam Flashcards

1
Q

A strong currency means importation is cheap.

A

true

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2
Q

A weak currency means exportation is expensive.

A

false

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3
Q

In FOREX, prices change in small increments and fast.

A

true

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3
Q

FOREX is the most liquid investment as there are many buyers and sellers at the same
time.

A

true

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4
Q

Tourism is one of the biggest contributors to the stability of a given currency.

A

true

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5
Q

The Foreign Direct Investment (FDI) brings in more peso to the Philippines.

A

false

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6
Q

The Gross International Reserve (GIR) is the country’s reserve of dollar and other foreign
currencies.

A

true

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7
Q

Pegged FOREX adheres to the law of supply and demand in currencies.

A

false

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8
Q

Same as bonds. BIP is used to determine price movement of a currency

A

false

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9
Q

Currency is defined as a medium of exchange of goods and services.

A

true

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10
Q

Google is an example of a cryptocurrency.

A

false

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11
Q

When buying and selling currencies trades are conducted in blocks

A

false

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12
Q

Only listed companies need funds.

A

false

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13
Q

Public corporations are listed in the stock market.

A

true

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14
Q

Stock markets are primary markets.

A

false

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15
Q

Funds needed by a corporation are obtained at the secondary market.

A

false

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16
Q

If you buy shares of stocks of a company, you are a part owner of that said company

A

true

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17
Q

The main issue when a corporation issues additional stock to raise funds, is that they are
giving up control.

A

true

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18
Q

In stock trading, buy high, sell low.

A

false

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19
Q

The Philippine stock index (PSEl) is composed of 31 actively traded companies.

A

false

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20
Q

Cash dividend is one of the ways to earn income when investing into stocks.

A

true

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21
Q

There is no rejection or non-acceptance of stock subscription even it has exceeded both
maximum gain or loss of the said stock.

A

false

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22
Q

In the PSE, ALL SHARES represent all the shares of the listed companies in the stock
market.

A

true

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23
Q

When buying stocks, the first thing you should do is choose a stockbroker.

A

true

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24
Q

This is another way to analyze a listed company, take a look at the track records of those
managing and how well-managed the company is.

A

true

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25
Q

A certificate is issued when you buy shares of stocks.

A

false

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26
Q

Bonds can be interchangeably used with the word fixed income.

A

true

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27
Q

A bond is like a time deposit, with fixed rate, maturity.

A

true

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28
Q

Bonds, just like stocks, are risky assets.

A

true

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29
Q

There is an inverse relationship between interest and price.

A

true

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30
Q

Coupon rate = YTM, the price of the bond is at par.

A

true

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31
Q

Coupon rate > YTM, the price of the bond is trading at a discount

A

false

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32
Q

Coupon rate < YTM, the price of the bond is trading at a premium.

A

false

33
Q

RTB 15-1 means it will mature after 15 years and it is the first issue.

A

true

34
Q

Interest rate is computed as I = PxRxT/360 or 365.

A

true

35
Q

RTB/Treasury Bills/FXTN/ROP are examples of corporate securities

A

false

36
Q

GS are considered default risk free rate

A

true

37
Q

Sell high, buy low if you use yield basis in buying bonds

A

false

38
Q

Government and corporations can issue bonds.

A

true

39
Q

Financial Institutions have nothing to do with the bond issuance as they are not issuers
neither buyers of these securities.

A

false

40
Q

Coupon payments can be monthly, quarterly, semiannual and annual

A

true

41
Q

In the Philippines, peso being the legal tender, can only issue a peso denominated
bonds.

A

false

42
Q

All bonds should have an issuer

A

true

43
Q

Bonds are held under these three categories: Held for trading, available to sale, held to
issuance.

A

false

44
Q

Economic news will affect bond trading

A

true

45
Q

Yields move as prices move

A

true

46
Q

Rates are all quoted gross

A

true

47
Q

Yields move by BIPs (basis points).

A

true

48
Q

It is on the secondary market that the issuer of the bond will obtain the needed funds

A

false

49
Q

Only listed companies need funds

A

false

50
Q

Bonds are illiquid assets.

A
51
Q

Public corporations are listed in the stock market.

A

true

52
Q

Stock markets are primary markets

A

false

53
Q

Fund needed by a corporation is obtained at the secondary market.

A

false

54
Q

If you buy shares of stocks of a company, you are a part owner of that said company.

A

true

55
Q

The main issue when a corporation issues additional stocks to raise funds, is that they
are giving up control.

A

true

56
Q

Companies can borrow funds at the financial markets

A

true

57
Q

The Philippine stock index (PSE) is composed of 31 actively traded companies.

A

false

58
Q

Cash dividend is one of the ways to earn income when investing into stocks.

A

true

59
Q

There is no rejection or non-acceptance of stock subscription even it has exceeded both
maximum gain or loss of the said stock.

A

false

60
Q

In the buying transaction of stocks, you will be paying more because of commission and
fees charged by the offices involved in the said stock transactions.

A

true

61
Q

In the PSE, ALL SHARES represent all the shares of the listed companies in the stock
market

A

true

62
Q

In analyzing what stocks to buy or to sell, we have three fundamental approaches: Top
Down approach ,Bottom Up and sideways

A

false

63
Q

When buying stocks, the first thing you should do is choose a stock broker

A

true

64
Q

This is another way to analyze a listed company, take a look at the track records of those
managing and how well-managed the listed company is

A

true

65
Q

A certificate is issued when you buy shares of stocks.

A

false

66
Q

No two clients have the same financial needs

A

true

67
Q

Asset allocation is not essential in portfolio management

A

false

68
Q

This is the person that counsels and does investment on behalf of a client

A

Portfolio manager

69
Q

Risk is unavoidable that is why we need to manage them.

A

true

70
Q

This is defined as the art and science of making decisions about the investment mix and
policy, matching investment to objectives

A

Portfolio management

71
Q

If you are given this exchange rate USD/CAD =1.28, which currency is strong?

A

USD

72
Q

This is a statistical measure of volatility by calculating the variance in prices as it moves
to the mean or average return over a period so the higher the variance, the more
volatile the investments.

A

Standard deviation

73
Q

This refers to the collection of investment tools such as stocks, bonds, cash, and so on.

A

portfolio

74
Q

This is the position of a trader when he is expecting the market to go down, usually a
trader here is pessimistic

A

short position

75
Q

In portfolio management, you need to have an aggressive investment profile

A

false

76
Q

This is getting into different classes to diversify the portfolio of a client basing on his
objectives and risk appetite.

A

Diversification

77
Q

Diversification being a risk management technique is not a key element in portfolio
management

A

false

78
Q

This is the foreign currency reserves of a given country.

A

Gross international reserves

79
Q

Matching your investment to your financial obligation is one of the roles of a portfolio
managers

A

false

80
Q

This is used to measure volatility against the benchmark

A

Alpha

81
Q
A

CFMP (5 decks)

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