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| Section | Weight | Objectives |
|---|
| Topic 1: Advanced Techniques | 26% | - Statistical and Quantitative Analysis - Risk Management Basics - Cross-Asset Analysis - Systematic Trading Methods - Volatility Analysis
|
| Topic 2: Theory and History | 38% | - Behavioral Finance and Market Principles - Key Concepts and Terminology - Evolution of Technical Analysis
|
| Topic 3: Classical Techniques | 33% | - Technical Indicators - Cycles and Seasonality - Chart Pattern Analysis - Chart Types and Construction - Trend Analysis
|
| Topic 4: Ethics and Professional Standards | 3% | - Code of Ethics and Standards of Professional Conduct
|
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CMT Association CMT Level 1 Exam Sample Questions (Q283-Q288):
NEW QUESTION # 283
VHS Finance, a broking house for trading securities offers an interesting package to their existing clients. If the existing client bring new clients to VHS Finance, 10% of the brokerage generated will be paid to the existing client. Binny is an existing client of VHS, who is also a technical analyst. He encourages his own circle of customers to open accounts with VHS. His view is to get that extra 10% income. In the light of ethics, how is his action viewed?
- A. His action puts self interest ahead of that of the customers
- B. It is possible that his action may influence unnecessary trades for his clients in order to generate extra brokerage
- C. There is no violation of ethics on his behalf as the clients would have traded anywhere else any way
- D. His extra income is illegal and hence in violation of the code
Answer: B
Explanation:
Detailed Explanation:
The core ethical issue here is a conflict of interest. Binny's financial incentive (kickback from brokerage) might lead him to encourage excessive trading (churning) in his clients' accounts to maximize his own 10% cut, rather than acting in the clients' best interests.5152
NEW QUESTION # 284
A typical head and shoulder formation requires about _______ for formation.
- A. Three years
- B. Three weeks
- C. Three months
- D. Three days
Answer: C
Explanation:
Detailed Explanation:
Major reversal patterns like the Head and Shoulders are significant structures that take time to develop.
According to classical technical analysis, a reliable H&S top typically takes three months or more to form to have major predictive implications.
NEW QUESTION # 285
The chart formation highlighted below is a:
- A. Morning star
- B. Hanging man
- C. Bullish engulfing
- D. Hammer
Answer: C
Explanation:
Detailed Explanation:
The chart shows a small black candle followed by a large white candle that completely "engulfs" the previous candle's real body. Occurring after a downtrend, this is a Bullish Engulfing pattern.
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NEW QUESTION # 286
Put call ratio is:
- A. Market sentiment indicator585960
- B. Market momentum indicator555657
- C. Market breadth indicator
- D. External Indicator for markets616263
Answer: A
Explanation:
Detailed Explanation:676869
The Put/Call Ratio measures the volume of Puts vs. Calls. Since it reflects whether traders are betting on a decline (Puts) or a rise (Calls), it is a classi70c Sentiment Indicator, often used as a contrarian tool (extreme high put buying = market bottom).7172
NEW QUESTION # 287
Relative strength studies suggest that strong performance over which time period is an indicator of strong performance to follow?
- A. 52 weeks
- B. 13 weeks
- C. 4 weeks
- D. 26 weeks
Answer: D
Explanation:
Detailed Explanation:
Momentum studies (like Jegadeesh and Titman) famously found that stocks with high returns over the past 26 weeks (6 months) tend to outperform over the next period. This is the "sweet spot" for relative strength momentum.
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NEW QUESTION # 288
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