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Securities Products M2 Flashcards

6 cards from real CMFAS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 6 Securities Products M2 flashcards as text

  1. What is a treasury bill (T-bill)?

    Answer: A short-term government debt instrument issued at a discount

    Treasury bills are short-term government securities issued at a discount to face value and redeemed at par upon maturity, typically within one year.

  2. What is the Singapore Savings Bond (SSB)?

    Answer: A government bond designed for individual investors with flexible redemption

    SSBs are special SGS bonds designed for individual investors, offering step-up interest rates and the flexibility to redeem early without penalty.

  3. What is the function of the Central Depository (CDP)?

    Answer: To provide depository, clearing, and settlement services for securities

    CDP operates the central securities depository and provides clearing and settlement services for securities traded on SGX.

  4. What is a penny stock?

    Answer: A low-priced stock typically trading below $1 with higher risk

    Penny stocks are low-priced shares, typically trading below $1, of small companies. They are considered high-risk due to low liquidity and limited information.

  5. What are preference shares' typical characteristics compared to ordinary shares?

    Answer: Fixed dividend rate and priority in liquidation but limited voting rights

    Preference shares typically offer a fixed dividend, priority over ordinary shares in liquidation, but come with limited or no voting rights.

  6. What is the contra trading system on SGX?

    Answer: A system where investors can buy and sell the same stock within the settlement period without paying upfront

    Contra trading allows investors to buy and sell the same stock within the T+2 settlement period, settling only the net gain or loss.

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Sources & references

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  1. ibf.org.sg — Eligibility, fees, score release, registration, retake policy, exam format, passing score, time limit · verified Oct 2026