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CISI ICWIM Exam Syllabus Topics:

SectionWeightObjectives
Risk and Return20%- Portfolio theory
  • 1. Modern portfolio theory
  • 2. Risk-return profiling
  • 3. Asset allocation principles
- Risk concepts
  • 1. Types of investment risk
  • 2. Risk diversification
  • 3. Risk measurement
Financial Products20%- Bonds and fixed income
  • 1. Credit risk
  • 2. Bond types and characteristics
  • 3. Yield and price relationships
- Equities and shares
  • 1. Dividends and total return
  • 2. Types of equity
  • 3. Valuation methods
- Collective investments
  • 1. Fund selection criteria
  • 2. Funds and structured products
  • 3. ETFs and index trackers
Client Advisory25%- Client needs analysis
  • 1. Time horizons
  • 2. Investment objectives
  • 3. Risk profiling and suitability
- Portfolio construction
  • 1. Portfolio review and rebalancing
  • 2. Performance measurement
  • 3. Asset allocation strategies
Market Environment20%- Economic environment
  • 1. Business cycles
  • 2. Macroeconomic factors affecting investments
  • 3. Interest rates and inflation
- Role and function of financial markets
  • 1. Market participants and intermediaries
  • 2. Market indices and benchmarks
  • 3. Types of financial markets and their roles
Regulation and Ethics15%- Regulatory framework
  • 1. Financial regulation principles
  • 2. Compliance requirements
  • 3. Investor protection
- Ethical conduct
  • 1. Professional responsibilities
  • 2. CISI Code of Ethics
  • 3. Conflict of interest

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CISI International Certificate in Wealth & Investment Management Sample Questions (Q159-Q164):

NEW QUESTION # 159
The coupon on a bond has been expressed in real terms, rather than as a nominal amount. This is because:

Answer: A

Explanation:
* Real vs. Nominal Terms:
* Inflation-linked bonds adjust their coupon payments and principal based on inflation rates.
* Expressing the coupon in real terms ensures it reflects purchasing power rather than face value.
* Elimination of Other Options:
* B: Redemption date length is unrelated to coupon expression.
* C & D: Security type (unsecured/bearer) does not dictate coupon terms.
References:
* ICWIM Module 3: Explanation of bond types, including inflation-linked securities.


NEW QUESTION # 160
Why would an investment manager conduct forward-looking security attribution?

Answer: A

Explanation:
Forward-looking security attribution focuses on identifying potential future risks in a portfolio by analyzing market trends, economic indicators, and security performance forecasts.
* Why is Option B Correct?
* Investment managers use quantitative models and stress testing to identify upcoming risks.
* Helps in adjusting asset allocation and implementing hedging strategies.
* Why Not Other Options?
* A (Calculate future profits) # Attribution focuses on performance breakdown, not profit forecasting.
* C (Quantify annual charge) # Fees are predetermined and not part of attribution analysis.
* D (Outperform benchmark) # Attribution measures risk sources, not outperformance targets.
# Reference: CFA Institute (Performance Attribution), CISI Wealth & Investment Management.


NEW QUESTION # 161
The effect of gearing within an investment trust company is that it:

Answer: C

Explanation:
Gearing in an investment trust means the trust uses borrowing, or other forms of leverage, to increase the amount invested beyond shareholders' capital. This increases the trust's exposure to market movements.
When the underlying portfolio rises, the gains are earned on a larger invested base than equity alone, so shareholder returns can be enhanced after allowing for the cost of borrowing and any related financing charges. However, the same mechanism works in reverse. If the portfolio falls, losses are also experienced on the enlarged exposure, so declines in net asset value can be greater than they would be without gearing. As a result, gearing increases volatility and makes outcomes more extreme, which is why it is commonly described as amplifying both gains and losses. This is a key structural difference between investment trusts and many open-ended funds, and it is tested because it links directly to risk profiling, suitability, and the understanding that higher potential returns come with higher downside risk.


NEW QUESTION # 162
During a period of growth in consumer income the demand curve for a normal product would:

Answer: D


NEW QUESTION # 163
Which currency is most heavily traded on international markets?

Answer: C

Explanation:
* Global Currency Trading
* The US dollar dominates the foreign exchange market due to its status as the global reserve currency.
* It is heavily used in international trade, financial transactions, and as a benchmark currency.
* Market Share
* The US dollar is involved in approximately88% of all forex trades.
* Other currencies like the euro, Japanese yen, and British pound have significant market shares but are far behind the US dollar.
* ICWIM Study Guide, Chapter on Global Financial Markets: Highlights the US dollar as the most traded currency.
* Bank for International Settlements (BIS)Forex Market Surveys: Confirms trading dominance of the US dollar.
References


NEW QUESTION # 164
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