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.

1. What is the primary market in the context of securities trading? → The market where new securities are issued and sold for the first time
2. What is the primary purpose of using derivatives for hedging? → To reduce or offset the risk of adverse price movements in an existing position
3. 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
4. Which of the following is classified as an alternative investment? → A hedge fund using a long/short equity strategy
5. 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
6. What is the primary function of the London Stock Exchange (LSE)? → To provide a secondary market for the trading of listed securities
7. What is 'counterparty risk'? → The risk that the other party to a financial contract defaults on their obligations
8. What does the term 'gilts' refer to in UK financial markets? → UK government bonds issued by HM Treasury
9. What is the role of a clearing house in derivatives trading? → To act as the counterparty to both buyer and seller, reducing counterparty risk
10. 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
11. Which of the following is a placement technique rather than a layering technique in money laundering? → Depositing cash through a currency exchange bureau
12. Under the FCA's client categorisation rules, which category of client receives the highest level of regulatory protection? → Retail clients
13. What is the maximum custodial sentence for a principal money laundering offence under the Proceeds of Crime Act 2002? → 14 years
14. 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
15. 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)
16. What is a 'swap' in derivatives terminology? → A contract where two parties agree to exchange cash flows over a specified period
17. 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
18. What are the three stages of the money laundering process in the correct order? → Placement, Layering, Integration
19. What are the three statutory objectives of the Financial Conduct Authority (FCA)? → Consumer protection, market integrity, and promoting competition
20. 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
21. 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
22. What is the Financial Ombudsman Service (FOS) limit for complaints about investment firms (as of 2024)? → £375,000
23. What is the primary purpose of the Financial Services Compensation Scheme (FSCS)? → To compensate eligible customers when authorised firms fail
24. What is 'earnings per share' (EPS)? → A company's net profit divided by the number of shares in issue
25. What happens to the price of an existing fixed-rate bond when market interest rates rise? → The bond price falls
26. What is a fund of funds? → A fund that invests in other investment funds rather than directly in securities
27. What is an 'index-linked gilt'? → A gilt whose coupon and principal are adjusted in line with the Retail Prices Index (RPI)
28. 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)
29. What are the FCA's three main statutory objectives? → Consumer protection, market integrity, and competition
30. 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