CFS Cheat Sheet 2026

The 30 highest-yield CFS facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. What continuing education requirement supports tax strategies competence? → Ongoing education in regulatory changes, market developments, and best practices
2. Which type of bond has its principal and interest payments adjusted based on inflation? → TIPS (Treasury Inflation-Protected Securities)
3. How should conflicts of interest be managed in investment analysis? → Identify, disclose, and mitigate all actual and potential conflicts of interest
4. How should risk assessment performance be reported to clients? → Provide accurate, complete, and timely performance reporting with appropriate benchmarks
5. How should risk be assessed in tax strategies? → Evaluate risk tolerance, capacity, time horizon, and investment objectives systematically
6. What regulatory compliance requirement applies to tax strategies? → Full compliance with all applicable federal, state, and industry regulations
7. What is a 'lock-up period' in a hedge fund? → A minimum holding period during which investors cannot redeem their capital
8. What fiduciary duty applies to client relations? → Act in the client's best interest with loyalty, care, and full disclosure
9. What is the primary goal of investing in mutual funds? → To generate a diversified portfolio with potential for long-term growth
10. What is the role of diversification in an investment portfolio? → To reduce risk by spreading investments across different assets
11. How should portfolio management performance be reported to clients? → Provide accurate, complete, and timely performance reporting with appropriate benchmarks
12. A 'distressed debt' hedge fund strategy involves: → Buying debt securities of companies in or near bankruptcy at discounted prices
13. What regulatory compliance requirement applies to estate planning? → Full compliance with all applicable federal, state, and industry regulations
14. What regulatory compliance requirement applies to risk assessment? → Full compliance with all applicable federal, state, and industry regulations
15. How does market risk impact asset allocation decisions? → Market risk can cause asset values to fluctuate, making diversification important
16. What regulatory compliance requirement applies to financial planning? → Full compliance with all applicable federal, state, and industry regulations
17. Which bond type allows the investor to exchange the bond for shares of the issuer's stock? → Convertible bond
18. What continuing education requirement supports portfolio management competence? → Ongoing education in regulatory changes, market developments, and best practices
19. Which rating from Moody's indicates the highest investment-grade bond quality? → Aaa
20. What is the primary risk associated with callable bonds from an investor's perspective? → Reinvestment risk
21. What continuing education requirement supports risk assessment competence? → Ongoing education in regulatory changes, market developments, and best practices
22. What should a financial advisor do if they identify a conflict of interest? → Disclose the conflict and manage it appropriately
23. What fiduciary duty applies to risk assessment? → Act in the client's best interest with loyalty, care, and full disclosure
24. What fiduciary duty applies to investment analysis? → Act in the client's best interest with loyalty, care, and full disclosure
25. What is considered a breach of fiduciary duty in financial planning? → Providing recommendations that benefit the advisor over the client
26. How should conflicts of interest be managed in estate planning? → Identify, disclose, and mitigate all actual and potential conflicts of interest
27. Which type of mutual fund seeks to replicate the performance of a specific market index? → Index fund
28. What is the impact of inflation on an investment portfolio? → Inflation erodes purchasing power and can reduce real returns
29. How should conflicts of interest be managed in tax strategies? → Identify, disclose, and mitigate all actual and potential conflicts of interest
30. Infrastructure investments (such as toll roads, airports, and utilities) are attractive to long-term investors primarily because they offer: → Stable, predictable cash flows with inflation-linked revenue streams