Markets

Question 1

Unit trusts & mutual funds difference to ETFs

Answer 1

Unit trusts and mutual funds priced on underlying NAV from end of each day.
ETFs traded live on exchanges so price not based on NAV alone
Generally, ETFs lower fees as more passive

Question 2

What is SETS vs SETSqx and SEAQ

Answer 2

LSEs online trading system.
Order driven system
SETSqx and SEAQ for less liquid stocks - they are quite driven

Question 3

Example of a quote driven market

Answer 3

Bonds market, SEAQ
Needs market maker

Question 4

Example of order driven market

Answer 4

LSE Equities - matches buyer and seller orders

Question 5

Standard conditions to list on a market

Answer 5

• publish approved listing particulars or prospectus
• have published accounts for 3 years
• at least £30 million for shares or £200,000 for debt
• 10% of shares held publicly on date of admission
• demonstrate sufficient working capital
• need a sponsor

Question 6

Requirements to list on AIM

Answer 6

• no minimum company size, trading record or number of shares held publicly
• need a nominated advisor

Question 7

Requirements to list on ASQE

Answer 7

• have an ASQE corporate advisor
• at least 24 months audited accounts
• 10% of shares already held publicly
• demonstrate appropriate corporate governance along with minimum one independent non-executive director.

Question 8

Settlement times

Answer 8

Equities - t+2
Gilts - t+1

Question 9

What does the Financial Reporting Council (FRC) make institutional investors engage in

Answer 9

The UK Stewardship Code

Question 10

How are gilt premiums paid

Answer 10

Gross coupons semi annually