CISI IOI Cheat Sheet 2026
The 30 highest-yield CISI IOI facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.
- What is the primary market in the context of securities trading? → The market where new securities are issued and sold for the first time
- What is the primary purpose of using derivatives for hedging? → To reduce or offset the risk of adverse price movements in an existing position
- What is a key advantage of an investment trust over an open-ended fund such as a unit trust? → Investment trusts can borrow money (gear) to enhance returns
- Which of the following is classified as an alternative investment? → A hedge fund using a long/short equity strategy
- What is the primary function of the London Stock Exchange (LSE)? → To provide a marketplace where buyers and sellers can trade shares and other securities
- What is the primary function of the London Stock Exchange (LSE)? → To provide a secondary market for the trading of listed securities
- What is 'counterparty risk'? → The risk that the other party to a financial contract defaults on their obligations
- What does the term 'gilts' refer to in UK financial markets? → UK government bonds issued by HM Treasury
- What is the role of a clearing house in derivatives trading? → To act as the counterparty to both buyer and seller, reducing counterparty risk
- What type of share gives the holder the right to receive any unpaid dividends from previous years before ordinary shareholders receive theirs? → Cumulative preference shares
- Which of the following is a placement technique rather than a layering technique in money laundering? → Depositing cash through a currency exchange bureau
- Under the FCA's client categorisation rules, which category of client receives the highest level of regulatory protection? → Retail clients
- What is the maximum custodial sentence for a principal money laundering offence under the Proceeds of Crime Act 2002? → 14 years
- An investor buys a call option on shares with a strike price of GBP 5.00 and pays a premium of GBP 0.50. At what share price does the investor break even? → GBP 5.50
- What is the settlement period for UK equity trades conducted on the London Stock Exchange under the standard cycle? → T+2 (two business days after trade date)
- What is a 'swap' in derivatives terminology? → A contract where two parties agree to exchange cash flows over a specified period
- Which of the following is a characteristic of a zero-coupon bond? → It is issued at a discount to par and redeemed at par, with no periodic interest payments
- What are the three stages of the money laundering process in the correct order? → Placement, Layering, Integration
- What are the three statutory objectives of the Financial Conduct Authority (FCA)? → Consumer protection, market integrity, and promoting competition
- A basic rate taxpayer makes a personal pension contribution of GBP 8,000 (net). What is the gross contribution including basic rate tax relief? → GBP 10,000
- What is the Bank of England's primary monetary policy tool for influencing the UK economy? → Setting the Bank Rate (base rate), which influences borrowing costs throughout the economy
- What is the Financial Ombudsman Service (FOS) limit for complaints about investment firms (as of 2024)? → £375,000
- What is the primary purpose of the Financial Services Compensation Scheme (FSCS)? → To compensate eligible customers when authorised firms fail
- What is 'earnings per share' (EPS)? → A company's net profit divided by the number of shares in issue
- What happens to the price of an existing fixed-rate bond when market interest rates rise? → The bond price falls
- What is a fund of funds? → A fund that invests in other investment funds rather than directly in securities
- What is an 'index-linked gilt'? → A gilt whose coupon and principal are adjusted in line with the Retail Prices Index (RPI)
- Which of the following statements about index-linked gilts is correct? → Both the coupon and principal are adjusted in line with the Retail Price Index (RPI)
- What are the FCA's three main statutory objectives? → Consumer protection, market integrity, and competition
- Which of the following is a characteristic of investing in physical commodities such as gold? → They involve storage and insurance costs and generate no income
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