CANNON CTFA COMPREHENSIVE EXAM 2026
QUESTIONS AND SOLUTIONS GRADED A+
✔✔Municipal Bonds - ✔✔What can Pooled Income Funds NOT invest in
✔✔Bonds - ✔✔A widow, 75 years old, with no heirs wants stable income with little risk
should have a portfolio constructed mostly of what?
✔✔Common Stock - ✔✔What has provided the highest return over the past 50 years
✔✔Growth Stocks - ✔✔Exhibit high PE Ratios, Low Dividend Yields, high price volatility
✔✔Food, beverage, toiletries - ✔✔Defensive stocks include
✔✔The companies Board of Directors - ✔✔Who determines and declares a companies
dividends
✔✔Corporate Bonds - ✔✔What pays a high yield compared to Treasury or Agency
Bonds?
✔✔appreciating; lower - ✔✔When exchange rates of foreign currencies increases it
means the foreign currency is _____________and the cost of US made goods in that
country will be _____________
✔✔Money-Market Funds - ✔✔Possesses HIGH liquidity and HIGH marketability VERY
low risk investment option?
✔✔Gold and Real Estate - ✔✔What is a good inflation hedge in a portfolio
✔✔preferred stock - ✔✔stock that entitles the holder to a fixed dividend, whose
dividend payment takes priority over that of common-stock dividends. No voting rights.
✔✔systemic risk - ✔✔Type of Risk that CANNOT be diversified away
✔✔Debt Coverage - ✔✔A corporate bonds safety is best measured by its
✔✔Time - ✔✔What is the single most important variable in deciding on a risk level?
✔✔Sell; Raise - ✔✔When the Federal Reserve Board (FRB) CONTRACTS the money
supply it would _____________ securities and _____________ reserves.
✔✔Cumulative Preferred Stock - ✔✔What kind of stock is entitled to dividends in
arrears?
QUESTIONS AND SOLUTIONS GRADED A+
✔✔Municipal Bonds - ✔✔What can Pooled Income Funds NOT invest in
✔✔Bonds - ✔✔A widow, 75 years old, with no heirs wants stable income with little risk
should have a portfolio constructed mostly of what?
✔✔Common Stock - ✔✔What has provided the highest return over the past 50 years
✔✔Growth Stocks - ✔✔Exhibit high PE Ratios, Low Dividend Yields, high price volatility
✔✔Food, beverage, toiletries - ✔✔Defensive stocks include
✔✔The companies Board of Directors - ✔✔Who determines and declares a companies
dividends
✔✔Corporate Bonds - ✔✔What pays a high yield compared to Treasury or Agency
Bonds?
✔✔appreciating; lower - ✔✔When exchange rates of foreign currencies increases it
means the foreign currency is _____________and the cost of US made goods in that
country will be _____________
✔✔Money-Market Funds - ✔✔Possesses HIGH liquidity and HIGH marketability VERY
low risk investment option?
✔✔Gold and Real Estate - ✔✔What is a good inflation hedge in a portfolio
✔✔preferred stock - ✔✔stock that entitles the holder to a fixed dividend, whose
dividend payment takes priority over that of common-stock dividends. No voting rights.
✔✔systemic risk - ✔✔Type of Risk that CANNOT be diversified away
✔✔Debt Coverage - ✔✔A corporate bonds safety is best measured by its
✔✔Time - ✔✔What is the single most important variable in deciding on a risk level?
✔✔Sell; Raise - ✔✔When the Federal Reserve Board (FRB) CONTRACTS the money
supply it would _____________ securities and _____________ reserves.
✔✔Cumulative Preferred Stock - ✔✔What kind of stock is entitled to dividends in
arrears?
