IFC Cheat Sheet 2026

The 30 highest-yield IFC facts, distilled from real exam questions. Print it, save it as a PDF, or study it here — free, no sign-up.

1. What response would a loss-averse investor be most likely to choose in selecting a preferred investment return scenario? → A 25% chance of gaining $2,000, and a 75% chance of losing nothing.
2. Following regulatory changes implemented in May 2024, what is the standard settlement cycle for most equity and long-term debt transactions in Canada? → T+1 (Trade date plus one business day)
3. A mutual fund's performance report indicates that it is ranked in the 1st quartile for the past five years. What does this ranking signify? → The fund performed better than at least 75% of its peer group.
4. Which type of investor would benefit MOST from the potential creditor protection offered by segregated funds? → A self-employed professional or business owner with personal liability exposure
5. Which regulatory body primarily oversees segregated funds in Canada? → Provincial insurance regulators
6. Which of the following is NOT a primary objective of the Know Your Client (KYC) process? → To guarantee the client will achieve their financial goals.
7. What is the typical minimum holding period required before a segregated fund's maturity guarantee applies? → 10 years
8. How does naming a beneficiary directly on a segregated fund benefit the contract holder's estate plan? → It allows death proceeds to bypass the estate, potentially avoiding probate fees
9. Which newspaper article would be likely to result in foreign capital moving out of a country? → New Taxes on Foreign Direct Investment
10. If the Consumer Price Index (CPI) was 140.6 last year and 146.9 this year, what was the inflation rate over the year? → 4.48%
11. Which of the following costs is NOT included in a mutual fund's Management Expense Ratio (MER)? → Brokerage commissions for portfolio transactions
12. An economy is entering a contractionary phase of the business cycle. Which of the following conditions is an investor most likely to observe? → Rising unemployment and declining corporate profits
13. An individual has an RRSP deduction limit of $15,000 for the year. They contribute $18,000 to their RRSP. What is the immediate tax consequence of this action? → A 1% per month penalty tax is applied to the excess contribution amount of $1,000.
14. Which of the following is NOT a feature that distinguishes segregated funds from mutual funds? → Daily pricing and liquidity for redemptions
15. A Canadian equity fund has a beta of 1.3. If its benchmark, the S&P/TSX Composite Index, falls by 5% in a month, what is the fund's expected performance? → A decrease of 6.5%
16. Which organization provides oversight of life insurance agents who sell segregated funds in Canada? → Provincial insurance regulators and life insurance councils
17. Fiscal policy refers to the government's use of which tools to influence the economy? → Taxation and government spending.
18. What stage in the business cycle typically has increasing wages, rising inflation, rising interest rates with slowing sales, and decreasing business investment? → Peak
19. What does the '2 and 20' fee structure, commonly associated with traditional hedge funds, typically represent? → A 2% annual management fee on assets and a 20% performance fee on profits.
20. In a segregated fund contract, who is referred to as the 'annuitant'? → The person whose life the insurance coverage is based on
21. Which exchange in Canada deals exclusively with financial and equity futures and options? → The Montreal Exchange
22. What is the primary objective of adding assets with low or negative correlation to each other within an investment portfolio? → To reduce the portfolio's overall volatility.
23. What license must a representative hold to legally sell segregated funds in Canada? → A life insurance license issued under provincial insurance legislation
24. What is the primary legal structure of a segregated fund in Canada? → An insurance contract issued by a life insurance company
25. What term applies to unemployment created by a new technology that eliminates the need for subway train drivers? → Structural
26. Under which legislative framework are segregated funds in Canada primarily governed? → The federal Insurance Companies Act and provincial insurance acts
27. An investor purchases a no-load mutual fund. Which of the following fees will they most likely avoid paying? → An initial sales charge
28. A client is concerned about the impact of rising interest rates on their bond fund. How should an advisor explain the likely short-term effect? → The value of existing bonds in the fund will decrease.
29. When analyzing a mutual fund's risk, what does a higher standard deviation indicate? → The fund's returns are more volatile and less consistent.
30. Which organization regulates mutual and investment funds? → Securities commissions.