SUBJECTS
|
BROWSE
|
CAREER CENTER
|
POPULAR
|
JOIN
|
LOGIN
Business Skills
|
Soft Skills
|
Basic Literacy
|
Certifications
About
|
Help
|
Privacy
|
Terms
|
Email
Search
Test your basic knowledge |
Wealth Management Exam
Start Test
Study First
Subjects
:
personal-finance
,
business-skills
Instructions:
Answer 50 questions in 15 minutes.
If you are not ready to take this test, you can
study here
.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. Representation in domestic and international - large - mid - small cap - no individual stock more than 5% of total portfolio
diversifying stocks
offer wealth management services
calculating expected return
dollar cost averaging
2. High income upside potential - low base salary - greater requirement to sell in many cases - including cold call - cutting edge investment thinking - products - and support - SEC licensing required - potential long term commitment required
who use salary based model
working at brokerage
idiosyncratic risk
calculating expected return
3. Strategy of reducing idiosyncratic risk by making two investments whose payoffs are unrelated
how to protect client from unjustified risks?
what would happen if you were out of the stock market during the 90 best days
spreading risk
How many issues needed to create a diversified stock portfolio?
4. Paid for U.S. corp or qualified foreign corp - taxed at 15% for those in tax bracket of 25% or more - taxed at 0% for those in tax bracket less than 25% - holding period requirement
commission
how to compute variance
qualified dividends
diversifying bonds
5. Across and within asset classes - internationally as well as domestically - find investments with low correlation R2 - asset correlation changes over time - for stocks diversify across and within sectors - diversify over time with dollar cost averagi
how to diversify
working at community bank
risk-free investment
rebalancing
6. Restricted and unrestricted funds - characteristics and constraints
who use hourly
drivers of return
diversification
purpose of the funds to be invested
7. The theoretical rate of return of an investment with no risk of financial loss - i.e. short dated domestic govt bond (default benchmark)
investment policy statement
best client suited for fee based
what to ask if client has inappropriate allocation
risk-free investment
8. Weighted average of the expected returns of its components
calculating expected return
what would happen if you were out of the stock market during the 90 best days
how 15-20 stocks create diversified portfolio
what to ask if client has inappropriate allocation
9. Culture/philosophy - money - risk/reward - career trajectory - other support roles
uniform prudent investor act
4 ways of getting paid
how to choose where to work
needs step of wealth management
10. Paid per transaction for your idea
certified financial planner
commission
how to compute variance
Value at Risk (VaR)
11. 0 company could fail
VaR of stocks and bonds
how to compute variance
VaR of bank's mortgage backed securities
sources of taxable return
12. Assumption of trustee for assets - standard of prudence applied to whole portfolio rather than individual asset - tradeoff between risk and return - trustee can invest in anything that plays an appropriate role in risk/return profile - diversificati
who use hourly
uniform prudent investor act
reasons to retain certain assets
wealth management positions
13. Recovery rate (how much get back if default)
Warning
: Invalid argument supplied for foreach() in
/var/www/html/basicversity.com/show_quiz.php
on line
183
14. General economic conditions - tax consequences of change - role of asset w/ in total portfolio - total return including income and principal - other resources - need for liquidity - income - preservation or appreciation of principal
diversifying stocks
who is suited for wealth management career
how to choose where to work
iowa trust code requires the trustee to consider
15. Monitoring performance and adherence to policy - reviewing IPS on regular basis
responsibilities of the client
investment policy statement
who use salary based model
systematic risk
16. Unique risks
asset allocation
diversifying stocks
monitor step of wealth management
idiosyncratic risk
17. If stocks are chosen carefully to create lowest possible correlation of returns - if those stocks are monitored carefully to assure that they will continue to have uncorrelated returns
timing of rebalancing
dollar cost averaging
two rates that returns are taxed by
how 15-20 stocks create diversified portfolio
18. Brokerages - insurance companies
Value at Risk (VaR)
commission
setting allocation policy based on targets and ranges
use commissions model
19. Brokerages - investment banks - commercial banks - trust departments - large comprehensive accounting firms - independent financial planners - insurance companies
validation step of wealth management
offer wealth management services
rebalancing
where do wealthy clients get their money?
20. Only those who will be sellers of equities in the near future should be happy at seeing stocks rise. prospective purchasers should much prefer sinking prices
working at large national bank
investment policy statement
drivers of return
what Warren Buffet says about diversifying over time with $ cost averaging
21. Broker/dealer- FINRA - SEC - bank exemption- fed and state regulators - employers - industry associations
use fee based model
how time impacts risk
deviation of payoff from expected value
who governs these services
22. In a fee based environment - base salary typically has a sig. variable component in the form of commissions or bonuses - variable compensation determined by quantitative and qualitative factors - similar to fee arrangement for client
salary
offer wealth management services
uniform prudent investor act
probability theory
23. 3 yrs qualified work experience - complete cfp courses and exams - financial planning - employee benefits planning - investment planning - risk management - retirement planning
how time impacts risk
certified financial planner
who governs these services
how to diversify
24. Majority of diversification benefit is reached with a portfolio of as few as 15-20 stocks => no more than 5% of stock portfolio in any one company - depends on definition of market
risk-free investment
4 ways of getting paid
what happens if you never rebalance
How many issues needed to create a diversified stock portfolio?
25. Unique risks
4 ways of getting paid
best client suited for commission based
VaR of bank's mortgage backed securities
idiosyncratic risk
26. You would have missed 96% of market's gains
who else will you serve?
why correlation matters
what would happen if you were out of the stock market during the 90 best days
rebalancing recommendations
27. Ordinary income tax rate (high - up to 35%) - capital gains rate (low - 0% or 15%)
measuring risk
two rates that returns are taxed by
measuring risk
asset allocation
28. Representation in domestic and international - large - mid - small cap - no individual stock more than 5% of total portfolio
qualified dividends
diversifying stocks
certified financial planner
purpose of the funds to be invested
29. Don't want stocks highly correlated if trying to diversify
systematic risk
why correlation matters
measuring risk
VaR of adjustable rate mortgage?
30. Accumulate wealth over time by spending less than they earn - invest 20% of income per year - incomes are about average - advanced degrees
VaR of bank's mortgage backed securities
wealth management positions
timing of rebalancing
where do wealthy clients get their money?
31. Appropriate credit quality and interest rate risk - no individual corporate issuer more than 5%
diversifying bonds
what makes a good benchmark
drivers of return
responsibilities of the client
32. Client is unwilling to make appropriate trades due to tax impact or sentimental attachment - wealth management is unable to determine correlations between stocks - trading them through time (actively managing account)
how 15-20 stockswill not diversify portfolio
reasons to retain certain assets
qualified dividends
who use hourly
33. Bonds: coupon income + changes in price due to changes in interest rates - stocks: dividend yield + growth in earnings + change in p/e
what return includes for mutual funds
who is suited for wealth management career
drivers of return
deviation of payoff from expected value
34. Restricted and unrestricted funds - characteristics and constraints
where do wealthy clients get their money?
wealth management positions
purpose of the funds to be invested
wealth management recommendation about rebalancing
35. Purpose of the funds to be invested - investment objectives - responsibilities of the investment manager - responsibilities of the client - set allocation policy based on targets or ranges
investment policy statement
setting allocation policy based on targets and ranges
who use salary based model
working at large national bank
36. Take account of the bank's strategy - product - recommendations - ideas and investment themes - apply allocation rules - investment proposal
How many issues needed to create a diversified stock portfolio?
develop investment sections step of wealth management
rebalancing recommendations
how to choose where to work
37. Value of the worst possible outcome - measures maximum potential loss - over a specific time horizon - at a given probability - used widely in the management and regulation of financial institutions
Value at Risk (VaR)
best client suited for commission based
how to choose where to work
how to computer std. dev
38. Brokerages - investment banks - commercial banks - trust departments - large comprehensive accounting firms - independent financial planners - insurance companies
use fee based model
hourly
what to ask if client has inappropriate allocation
offer wealth management services
39. Weighted average of the expected returns of its components
best client suited for fee based
market timing
calculating expected return
certified financial planner
40. How far does it stray? - do other client characteristics justify the variance? what changes need to be made to correct? - how long? - - cost in taxes and transaction costs? - worth it to reallocate?
how 15-20 stockswill not diversify portfolio
who use hourly
what to ask if client has inappropriate allocation
purpose of the funds to be invested
41. Focus on integrated services/ cross selling - may be less pressure to sell than brokerage but more than community bank - blurring lines between brokerage and trust areas
working at large national bank
what return includes for mutual funds
uniform prudent investor act
Value at Risk (VaR)
42. Recovery rate (how much get back if default)
Warning
: Invalid argument supplied for foreach() in
/var/www/html/basicversity.com/show_quiz.php
on line
183
43. Payoff-expected value
how to computer std. dev
How many issues needed to create a diversified stock portfolio?
VaR of adjustable rate mortgage?
deviation of payoff from expected value
44. Selling loses so you avoid capital gain taxes
tax loss harvesting
responsibilities of the client
hedging risk
asset allocation
45. Income and capital gain/loss in value - income is passed through to shareholders - gain/loss occurs on the mutual funds shares as well as on the underlying fund portfolio - fund portfolio gains are passed to shareholders; losses are retained in the f
spreading risk
why correlation matters
idiosyncratic risk
what return includes for mutual funds
46. Take account of the bank's strategy - product - recommendations - ideas and investment themes - apply allocation rules - investment proposal
probability theory
develop investment sections step of wealth management
wealth management recommendation about rebalancing
hourly
47. Bringing portfolio back to our allocation policy when market forces or life events changed the mix
diversifying bonds
rebalancing
use commissions model
what Warren Buffet says about diversifying over time with $ cost averaging
48. Measure of uncertainty about the future payoff to an investment measured over some time horizon and relative to a benchmark
what to ask if client has inappropriate allocation
risk
how to compute variance
VaR of stocks and bonds
49. Invest some fixed amount of money at regular intervals - allows to buy more shares when prices are low - not market timing doesn't work - reduces down side risk of putting lump sum in prior to a drop in value
who is suited for wealth management career
dollar cost averaging
how to choose where to work
fee
50. Payoff X probability - payoff is the potential return of the investment
what makes a good benchmark
what happens if you never rebalance
probability theory
4 ways of getting paid
Sorry!:) No result found.
Can you answer 50 questions in 15 minutes?
Let me suggest you:
Browse all subjects
Browse all tests
Most popular tests
Major Subjects
Tests & Exams
AP
CLEP
DSST
GRE
SAT
GMAT
Certifications
CISSP go to https://www.isc2.org/
PMP
ITIL
RHCE
MCTS
More...
IT Skills
Android Programming
Data Modeling
Objective C Programming
Basic Python Programming
Adobe Illustrator
More...
Business Skills
Advertising Techniques
Business Accounting Basics
Business Strategy
Human Resource Management
Marketing Basics
More...
Soft Skills
Body Language
People Skills
Public Speaking
Persuasion
Job Hunting And Resumes
More...
Vocabulary
GRE Vocab
SAT Vocab
TOEFL Essential Vocab
Basic English Words For All
Global Words You Should Know
Business English
More...
Languages
AP German Vocab
AP Latin Vocab
SAT Subject Test: French
Italian Survival
Norwegian Survival
More...
Engineering
Audio Engineering
Computer Science Engineering
Aerospace Engineering
Chemical Engineering
Structural Engineering
More...
Health Sciences
Basic Nursing Skills
Health Science Language Fundamentals
Veterinary Technology Medical Language
Cardiology
Clinical Surgery
More...
English
Grammar Fundamentals
Literary And Rhetorical Vocab
Elements Of Style Vocab
Introduction To English Major
Complete Advanced Sentences
Literature
Homonyms
More...
Math
Algebra Formulas
Basic Arithmetic: Measurements
Metric Conversions
Geometric Properties
Important Math Facts
Number Sense Vocab
Business Math
More...
Other Major Subjects
Science
Economics
History
Law
Performing-arts
Cooking
Logic & Reasoning
Trivia
Browse all subjects
Browse all tests
Most popular tests