Practice Test GeeksCIM - Chartered Investment Manager Practice Test
← All CIM Flashcard Decks

Client Relations Flashcards

7 cards from real CIM practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Client Relations flashcards as text

  1. A client has a required minimum distribution and plans to buy a house within 12 months. Which IPS constraint is most directly affected?

    Answer: Liquidity constraint

    Known near-term cash needs are liquidity requirements the portfolio has to plan for.

  2. A client asks that the portfolio exclude tobacco and firearms companies. How should this be handled?

    Answer: Document it as a unique circumstance or restriction in the IPS and implement it

    Client-specific investment restrictions such as ESG exclusions belong in the IPS under unique circumstances.

  3. When onboarding a new client, why must the manager complete Know Your Customer (KYC) procedures?

    Answer: To verify identity, meet AML rules, and understand the client's financial profile for suitable advice

    KYC supports anti-money-laundering compliance and gives the basis for suitable recommendations.

  4. A client with a 30-year horizon and stable income wants to hold only money market funds. What is the manager's best course of action?

    Answer: Educate the client on the long-term risk of inflation and shortfall, while respecting their final decision

    The manager should explain the risk that an overly conservative portfolio won't meet long-term goals, then document the client's informed choice.

  5. Which client segment typically needs the most complex relationship management, including estate, tax, and multi-generational planning?

    Answer: Ultra-high-net-worth families

    UHNW families usually have complex structures, several stakeholders, and estate and tax issues that need coordinated advice.

  6. Which fee disclosure practice is best?

    Answer: Clearly disclose all fees, including advisory, fund, transaction, and custody costs

    Full fee transparency lets clients understand the total cost of the relationship and is required by disclosure rules.

  7. A client's portfolio has drifted to 75% equities against a 60% IPS target. What should the manager do?

    Answer: Rebalance toward the target within the IPS ranges, considering taxes and costs

    Rebalancing keeps the portfolio aligned with the risk level the client agreed to, while taking transaction and tax costs into account.