CISI UAE FRR Investment Products and Markets

Question 1

What are the two main stock exchanges operating in the UAE?

Accepted Answer

Abu Dhabi Securities Exchange (ADX) and Dubai Financial Market (DFM)

Answer

NASDAQ Dubai and Bahrain Bourse

Answer

Kuwait Stock Exchange and Muscat Securities Market

Answer

DFM and London Stock Exchange

Question 2

What is a sukuk in Islamic finance as practiced in the UAE?

Accepted Answer

An Islamic financial certificate similar to a bond but compliant with Sharia law

Answer

A conventional interest-bearing bond

Answer

A type of insurance product

Answer

A derivative instrument

Question 3

Which of the following is a feature of the UAE's Delivery Versus Payment (DVP) settlement system?

Accepted Answer

Securities and payment are exchanged simultaneously to reduce settlement risk

Answer

Payment is made 30 days after delivery

Answer

Only applicable to government bonds

Answer

Settlement occurs only in US dollars

Question 4

What is the T+2 settlement cycle used in UAE stock exchanges?

Accepted Answer

Settlement of trades occurs two business days after the trade date

Answer

Trades must be reversed within 2 hours

Answer

Traders have 2 minutes to confirm orders

Answer

Taxes are applied 2 days after trading

Question 5

What is the primary purpose of the Emirates Securities and Commodities Authority's (SCA) disclosure requirements?

Accepted Answer

To ensure transparency and protect investors through timely disclosure of material information

Answer

To increase government tax revenue

Answer

To limit the number of listed companies

Answer

To control stock prices

Question 6

What is a Real Estate Investment Trust (REIT) as regulated in the UAE?

Accepted Answer

A publicly traded fund that owns and operates income-generating real estate

Answer

A private real estate development company

Answer

A government housing scheme

Answer

A type of mortgage product