Free CISI practice questions
Real, exam-standard CISI questions written to the current syllabus. No sign-up. Answer a few below, then unlock the full bank for all nine exams.
Practice is the single most effective thing you can do to pass a CISI exam, and it is exactly what most candidates skip in favour of re-reading the workbook. The questions below are written to the current CISI syllabus and current UK regulation, in the same multiple-choice format as the real paper. Pick an answer and the explanation appears, so you learn from every one.
This is a free sample with no account needed. The full Passkey question bank runs to over 4,400 questions across all nine exams, sorted so you drill exactly where you are weak. Start with the free diagnostic to find your weak spots, or jump straight into a specific exam below.
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Try 10: Introduction to Securities & Investment
Pick an answer to see whether you got it, and why.
Which type of financial institution primarily assists companies in raising capital through issuing securities and advising on mergers and acquisitions?
Not quite. The answer is C.
Investment banks specialise in helping companies raise capital by underwriting and issuing securities, as well as advising on mergers and acquisitions. Retail banks focus on personal banking services like current accounts and mortgages. Building societies are mutual organisations focused on savings and mortgage lending. Insurance companies manage risk through insurance products.
In a market economy, the allocation of resources is primarily determined by:
Not quite. The answer is B.
In a market economy, resources are allocated primarily through the price mechanism driven by supply and demand. Central government planning characterises a state-controlled economy. While trade agreements and monetary policy influence economic activity, they are not the primary allocation mechanism in a market economy.
A Treasury bill is a short-term instrument issued by the government that:
Not quite. The answer is B.
Treasury bills are short-term money market instruments issued by the government at a discount to face value and redeemed at par (face value) on maturity. The difference between the purchase price and face value represents the investor's return. They do not pay coupons, typically have maturities of up to 12 months, and are primarily bought by institutional investors.
Preference shareholders typically have priority over ordinary shareholders in respect of:
Not quite. The answer is B.
Preference shareholders have priority over ordinary shareholders when it comes to dividend payments and the return of capital if the company is wound up. However, they typically do not have voting rights (that's an ordinary shareholder privilege) and their dividends are usually fixed rather than variable.
A bond with a nominal value of £100, a coupon of 5%, and a current market price of £125 has a flat yield of:
Not quite. The answer is C.
Flat yield (also called running yield or current yield) is calculated as: (Annual Coupon / Market Price) x 100. The annual coupon is 5% of £100 nominal = £5. So: (£5 / £125) x 100 = 4%. The flat yield is lower than the coupon rate because the bond is trading at a premium (above par).
The holder of a call option has:
Not quite. The answer is C.
A call option gives the holder (buyer) the right, but not the obligation, to buy the underlying asset at the strike price on or before the expiry date. The writer (seller) of the call has the obligation to sell if the holder exercises. A put option gives the right to sell. The key distinction is that option holders have rights while writers have obligations.
A key advantage of collective investment schemes over direct investment is:
Not quite. The answer is A.
The main advantage of collective investment is diversification. By pooling money from many investors, the fund can invest across a wide range of assets, reducing the impact of any single investment performing badly. Returns are never guaranteed. Funds do charge management fees. Investors give up individual stock selection in exchange for professional management and diversification.
The three stages of money laundering are, in order:
Not quite. The answer is C.
The three stages of money laundering are: Placement (introducing criminal funds into the financial system), Layering (moving the money through multiple transactions to disguise its origin), and Integration (the money re-enters the legitimate economy appearing to be from a lawful source). The order is always placement first, then layering, then integration.
Capital Gains Tax (CGT) is payable on:
Not quite. The answer is B.
CGT is charged on the profit (gain) made when a chargeable asset is disposed of, such as selling shares, property (other than your main home), or other investments. Employment income is subject to income tax, not CGT. Interest and dividends are also subject to income tax, not CGT.
If the quoted annual interest rate on a savings account is 6% and interest is compounded monthly, the effective annual rate (EAR) will be:
Not quite. The answer is D.
When interest is compounded more frequently than annually, the effective annual rate is higher than the quoted (nominal) rate because you earn interest on interest. The EAR formula is: (1 + r/n)^n - 1, where r is the nominal rate and n is the number of compounding periods. For 6% compounded monthly: (1 + 0.06/12)^12 - 1 = 6.17%. The more frequently interest compounds, the higher the EAR relative to the quoted rate.
These are a free sample. Passkey has over 4,400 exam-standard questions across all nine CISI exams, sorted so you drill exactly where you are weak. Find your weak spots with the free diagnostic.
Frequently asked questions
Are these real CISI exam questions?
No. CISI does not release its live exam questions. These are original questions written by Passkey to match the current CISI syllabus, the multiple-choice format, the difficulty and the element weightings of the real paper.
Do I need to pay or sign up to practise?
No. The samples on this page are free with no account, and a free account opens chapter 1 of every exam with study notes and flashcards. The full question bank and mock exams across all nine CISI exams are part of the £59 Pass Package, which is a single payment with no subscription.
Which CISI exams are covered?
All nine: the Introduction to Securities & Investment, the three Capital Markets Programme papers (UK Financial Regulation, Securities and Derivatives), the IOC technical unit Global Securities Operations, both Investment Advice Diploma papers (Investment, Risk & Taxation and Financial Planning & Advice), and two Risk & Compliance certificates (Risk in Financial Services and Global Financial Compliance).
How many practice questions does Passkey have?
Over 4,400 across the nine exams, plus full mock exams weighted exactly like the real papers. You practise across every syllabus element rather than drilling the same handful.
Find your weak spots before exam day.
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