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| Section | Weight | Objectives |
|---|---|---|
| Topic 1: Market and company analysis | 8% | - Company performance analysis tools - Factors influencing the macroeconomy - Rules relating to companies - Effects of macroeconomic factors on financial markets - Technical and statistical analysis tools and information sources - Basic market theories and stock market behaviour - Economic indicators and sources of information - Industry performance analysis - Basic economic theories |
| Topic 2: Scope of client relationships | 15% | - Role of the Registered Representative in providing client service - Know-your-product obligations - Investment performance benchmarks - Suitability determination requirements for retail clients - Purpose and content of relationship disclosure - Systematic approaches to investment management and investment strategies - Requirements for working with clients in the United States and other foreign jurisdictions - Account appropriateness obligations - Role of the Investment Representative in providing client service - Exemptions from suitability determination requirements - Typical services provided by retail Investment Dealers - Product due diligence obligations - Trust, agency and fiduciary duty - Typical services provided by institutional Investment Dealers - Account appropriateness versus suitability determination - Institutional client sophistication assessment and suitability exemptions - Internal escalation procedures and subject matter experts |
| Topic 3: Prospective client relationships | 10% | - Required account agreement and Firm Welcome package documents - Retail client information collection - Exemptions under National Instrument 45-106 - Client record documentation, filing and maintenance - Investment Dealer onboarding process - Role of cost in product selection - Institutional client qualification requirements - Impact of fees, turnover and taxes on investment returns - Differences between retail and institutional clients - Third parties and other professionals in the client's life - Client relationship model |
| Topic 4: Overview of Canadian securities regulatory framework | 10% | - Function and purpose of the Canadian Investor Protection Fund - Investment Dealer registration and individual approval requirements - Function and purpose of other investment industry regulators and agencies - Role and authority of the Canadian Securities Administrators and provincial and territorial securities and derivatives regulators - Anti-money laundering and anti-terrorist financing legislation and regulations - Purpose and implications of the Bank Act and Bankruptcy and Insolvency Act - Other applicable laws including confidentiality, privacy, anti-spam, company disclosure and shareholder rights - Criminal Code and its application to financial crime - Function and purpose of clearing agencies - Role and authority of the Canadian Investment Regulatory Organization - Function and purpose of investment industry marketplaces |
| Topic 5: Securities, managed products, mutual funds and other investments | 19% | - Features, risks and returns of managed products - Asset classes generally sold and traded at an Investment Dealer - Types, features, risks and returns of equities - Other investments including hedge funds, structured products, alternative investment funds, crypto assets and ESG-related products - Types of pooled products - Types, features, risks and returns of fixed income securities and products - Purpose and uses of market indices - Considerations affecting fixed income investors - Considerations affecting exchange-traded fund investors - Considerations affecting mutual fund investors - Considerations affecting equity investors and potential shareholders - Considerations affecting managed product investors |
| Topic 6: Conflicts of interest and ethics | 15% | - Conflicts of interest management process - Inappropriate or prohibited personal financial dealings with clients - Ethical and legal responsibilities to clients - CIRO and other ethical standards of conduct - Activities outside an Investment Dealer - Importance of managing conflicts of interest - Requirements regarding positions of influence - Role of cybersecurity in protecting confidential information - Ethical principles and standards of conduct for Approved Persons and Investment Dealers - Information controls, barriers, firewalls and restricted lists - Client confidentiality policies and procedures - Importance of ethics and its relationship to rules |
| Topic 7: Client complaint handling and reporting | 5% | - Investment Dealer obligations to clients - Potential client issues, liability and consequences - Investment Dealer complaint reporting obligations and penalties - Recourse available to dissatisfied clients - Policies and procedures for reporting, handling and maintaining complaint records - Role of CIRO and provincial regulators in the complaints handling framework - Prohibited practices in client settlement agreements |
| Topic 8: Market integrity, trade execution and settlement | 12% | - Features of different order types - Features of different account types - Margin requirements - Order entry, trade management, settlement and delivery - Functions of investment banking, research and corporate finance - Universal Market Integrity Rules - Gatekeeping requirements for manipulative and deceptive practices, unacceptable activities and front running - Order variations, cancellations and corrections - Specialized trading agreements for derivative accounts - Order confirmation requirements - UMIR gatekeeping obligations - Reporting obligations to firms and regulators |
| Topic 9: Derivatives | 5% | - Single and multi-legged derivative trading strategies - Features of options contract types - Features of other derivative contract types - Administrative requirements for derivative trading with clients - Basic transactional elements of futures and options - Prohibited derivative trading practices - Listed versus over-the-counter derivative markets - Basic uses of derivatives |
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NEW QUESTION # 84
An employee or Approved Person must not engage in any personal financial dealings with clients.
Which of the following is least likely to be a prohibited dealing?
Answer: D
Explanation:
The correct answer is A . Properly authorized discretionary investment management conducted through the Investment Dealer is a legitimate regulated service and is distinguishable from prohibited personal financial dealings . CIRO IDPC Rule 3115 prohibits employees and Approved Persons from directly or indirectly engaging in personal financial dealings with clients, but expressly recognizes that control or authority exercised in a discretionary or managed account is permissible where it is exercised consistently with the account agreement and CIRO requirements.
The remaining choices closely correspond to activities specifically addressed by Rule 3115. Borrowing from or lending to clients is generally prohibited, subject only to narrowly defined exceptions and required Dealer approval in applicable circumstances. Paying client account losses from personal funds without the Dealer Member's prior written consent is expressly prohibited. Accepting personal remuneration, gratuities or other consideration for activities conducted on behalf of a client is also generally prohibited, subject to limited exceptions.
The underlying regulatory concern is conflict risk: representatives must not create private financial relationships with clients that could compromise objectivity, supervision or client protection. Authorized discretionary management, by contrast, occurs within the Dealer's regulated and supervised business structure.
Study Guide Reference: CIRE Element 9.7 - inappropriate or prohibited personal financial dealings with clients; IDPC Rule 3115.
NEW QUESTION # 85
Which of the following best describes the best execution rule?
Answer: C
Explanation:
The correct answer is D . Under CIRO's best-execution framework, best execution means obtaining the most advantageous execution terms reasonably available under the circumstances for the client order .
CIRO's current 2025 guidance confirms that Dealers must maintain policies and procedures reasonably designed to achieve that objective when acting for clients.
Best execution is therefore broader than simply obtaining the lowest purchase price or highest sale price.
IDPC Rule 3121 requires consideration of several factors, including the price of the security or derivative, speed of execution, certainty of execution and overall transaction cost where costs are passed to the client.
Liquidity, order size, market conditions and available marketplaces may also affect which execution approach provides the most advantageous overall result.
A is incorrect because the regulatory duty is owed in relation to the client order , not to whichever market participant receives the most favourable price. B is incorrect because routing every trade through one source without considering other available liquidity can actually conflict with best-execution obligations. C is too narrow because best execution is not simply "best price plus reduced commissions"; execution certainty, speed, liquidity and total costs must also be considered.
The CIRE syllabus specifically identifies best execution as a required UMIR/market-integrity competency.
Study Guide Reference: CIRE Element 6.1 - Best Execution; IDPC Rules 3120-3129.
NEW QUESTION # 86
What is the best course of action if an Investment Representative (IR) discovers a colleague engaging in what appears to be unethical behaviour?
Answer: B
Explanation:
The correct answer is A . An Investment Representative who observes conduct that appears unethical should escalate the matter through the Investment Dealer's established supervisory or compliance channels .
This allows appropriately authorized personnel to investigate the facts, preserve relevant records and determine whether corrective action or external regulatory reporting is required.
CIRO Rule 1402 requires Regulated Persons to maintain high standards of ethics and conduct, act openly and fairly, and avoid conduct that is unbecoming or detrimental to the public interest. CIRO's current trading- supervision guidance reinforces the broader principle that compliance is a firm-wide responsibility:
employees are expected to act on or escalate compliance issues , and the existence of a compliance department does not permit other employees to ignore suspected misconduct.
B is not ordinarily the first step merely because conduct appears unethical. Whether CIRO or another authority must subsequently be notified depends on the facts and applicable reporting rules; compliance and supervisory personnel determine and execute that process. C is inadequate because confronting the colleague could interfere with an investigation or permit evidence to be altered. D clearly conflicts with the ethical obligation to respond appropriately to suspected misconduct.
Where specific market-integrity violations are suspected, CIRO rules likewise require prompt reporting to a supervisor or compliance department.
Study Guide Reference: CIRE Elements 9.3-9.6 - ethical responsibilities, ethical decision-making and CIRO standards of conduct; IDPC Rule 1402.
NEW QUESTION # 87
An Investment Dealer supplies its clients with specific information about its client account reporting.
Which of the following is true regarding the provision of information about client reporting?
Answer: B
Explanation:
The correct response is D . Information describing the client account reporting that an Investment Dealer will provide is not merely useful or recommended; it forms part of the required relationship disclosure framework . Current CIRO IDPC Rule 3216 requires prescribed relationship disclosure information for retail clients. Rule 3216(5)(ii)(e) specifically requires "a description of the client account reporting that the Dealer Member will provide." The disclosure must address when trade confirmations and account statements will be sent, the Dealer's minimum obligations regarding performance information, when account position cost and account activity information will be provided, and whether percentage-return information is available as part of the account service offering.
The distinction is important. A particular reporting feature may, in some circumstances, be optional-for example, the rule requires disclosure of whether percentage-return information is an available option.
However, the Dealer's obligation to provide the prescribed information about its client reporting is mandatory . Therefore, A, B, and C understate the regulatory status of the disclosure requirement.
The CIRE syllabus expressly requires knowledge of relationship disclosure content, including the description of client account reporting that the Investment Dealer will provide .
Study Guide Reference: CIRE Element 3.4 - purpose and content of relationship disclosure; IDPC Rule 3216(5)(ii)(e).
NEW QUESTION # 88
What is the Investment Dealer's obligation regarding cost discussions for deferred sales charge products?
Answer: C
Explanation:
The correct answer is B . Where a client holds or considers a product subject to a deferred sales charge (DSC) schedule, the relevant cost implications must be explained before the client makes the affected investment decision . CIRO guidance states that, for purchases involving a DSC structure, clients should be advised that a charge may be triggered if the security is redeemed during the period in which the deferred charge applies.
The principle is informed consent: the client should understand that early redemption can reduce the proceeds received and should know the applicable timeframe and potential cost. More detailed transaction-fee guidance likewise requires disclosure of the amount or reasonable estimate of the DSC and the period during which it applies.
A is incorrect because DSC arrangements historically applied to retail mutual-fund investors, not exclusively institutional clients. C is too late as the primary obligation; disclosure only when the charge is about to be incurred would not provide adequate advance cost information. D conflicts directly with Dealer disclosure responsibilities.
A current regulatory distinction is important: new DSC mutual-fund sales have been prohibited in Canada since June 1, 2022 , but legacy DSC schedules from earlier purchases may continue until expiry.
The CIRE syllabus emphasizes understanding managed-product costs and charges and their impact on investor returns .
Study Guide Reference: CIRE Element 7.9 - Managed Products: impact of costs and charges; client cost disclosure requirements.
NEW QUESTION # 89
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