CIMA Study Guide 2026
Everything you need to pass the CIMA exam in one place: the exam format, every topic to study, real practice questions with explanations, flashcards, and full-length practice tests. Free, no sign-up needed.
📋 CIMA Exam Format at a Glance
📚 CIMA Topics to Study (69)
✍️ Sample CIMA Questions & Answers
1. Which of the following represents the real interest rate?
The real interest rate represents the true return on an investment after accounting for the effects of inflation. It is calculated by subtracting the inflation rate from the nominal interest rate. This calculation provides a more accurate picture of the purchasing power gained from an investment, as it adjusts for the erosion of value caused by rising prices.
2. The Security Market Line (SML) plots expected return against beta. A stock plotting above the SML is considered:
A stock above the SML has a positive alpha — it earns more than CAPM predicts, indicating undervaluation.
3. A portfolio manager generated a return of 12%. The risk-free rate is 2%, the market return is 10%, and the portfolio's beta is 1.2. What is the portfolio's Jensen's alpha?
Jensen's alpha is calculated using the Capital Asset Pricing Model (CAPM) formula: Alpha = Portfolio Return - [Risk-Free Rate + Beta * (Market Return - Risk-Free Rate)]. Plugging in the values: Alpha = 12% - [2% + 1.2 * (10% - 2%)] = 12% - [2% + 1.2 * 8%] = 12% - [2% + 9.6%] = 12% - 11.6% = 0.4%. A positive alpha indicates the manager outperformed the expected return for the given level of systematic risk.
4. Which of the following measures is most appropriate for evaluating a manager who runs a market-neutral long/short equity strategy?
The Sharpe ratio is appropriate for market-neutral strategies because it uses total risk (standard deviation) rather than beta, which approaches zero for such strategies.
5. When an IPS includes an ESG (Environmental, Social, Governance) mandate, the primary portfolio implication is:
ESG mandates typically result in screens that exclude or underweight companies or sectors that fail to meet specified environmental, social, or governance criteria.
6. Tracking error is best described as:
Tracking error measures the volatility of the difference between the portfolio's returns and the benchmark's returns, quantifying active risk.
🎯 Free CIMA Practice Tests
📖 CIMA Guides & Articles
- CFP vs CIMA: Which Certification Is Right for Your Investment Career?
- Certified Investment Management Analyst (CIMA): Complete Career Guide
- CIMA Practice Test PDF (Free Printable 2026)
- CIMA Certification Requirements 2026 — Eligibility & Application
- Certified Investment Management Analyst
- CIMA (Certified Investment Management Analyst) Test: Your Path to Success
- CIMA Practice Test Video Answers