Recently interest rates have gone up. Your customer, Mr. Corelli, has asked you how this will affect the value of his mortgage fund. What is the best response to give to Mr. Corelli?

• A.The mortgage fund will not be affected because the rise in interest rates will affect only new mortgages
• B.The value of the mortgage fund will go down because new mortgages will pay higher interest than those in the fund
• C.The mortgage fund will not be affected because mortgages do not react to changes in interest rates the way bonds do
• D.The value of the mortgage fund should go up because mortgages will now be earning higher interest

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Jabir recently joined Prosper Wealth Inc. and is looking forward to being a Dealing Representative for the firm. Which of the following statements CORRECTLY describe when Jabir will be eligible to open new client accounts and sell investments?

• A.Upon registration application by the dealer
• B.Upon employment with the dealer
• C.Upon formal confirmation from the regulator
• D.Upon passing the proficiency course

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What type of mutual fund can invest in specified derivatives and forward contracts for grains, meats, metals, energy products, and coffee?

• A.global equity fund
• B.commodity pool
• C.labour-sponsored investment fund
• D.specialty fund

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One of your clients, Harry, has heard that he can defer paying tax on capital gains. He wants to know if what he has heard is correct and if so, how to defer paying taxes on capital gains.
What would you tell Harry?

• A.He should hold profitable investments as long as possible.
• B.He should invest in mutual funds just before the dividend paying date to pick up the dividend.
• C.Harry should buy and sell investments actively.
• D.He should hold unprofitable investments as long as possible.

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Your client, Cosmo, recently inherited $50,000 from his uncle. He wants to use this money towards his retirement savings. Cosmo is a 50-year old, self-employed carpenter and he earns on average $65,000 per year. He has a registered retirement savings plan (RRSP) with the bank worth $425,000 and a tax-free savings account (TFSA) worth $46,000. He started saving when he was 25 years old and has always made his own investment decisions. His money is mostly invested in balanced funds. He feels most comfortable with these types of mutual funds since they offer potential investment growth but without being too aggressive. Cosmo has no other assets.
What additional information do you need about Cosmo to fulfill your know your client obligation?

• A.time horizon
• B.income and net worth
• C.risk tolerance
• D.investment objectives

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