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Certified Personal Financial Advisor (CPFA)
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Concept of Financial Planning
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Q1.
Arrange the financial planning process in the correct sequence: 1. Analyzing and evaluating current situation and needs 2. Gathering client data, including goals 3. Monitoring and reviewing the financial plan 4. Establishing and defining client relationship 5. Implementing the recommendations 6. Developing and presenting recommendations
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Q2.
Which of the following does not relate to financial planning?
Q3.
Financial planning is the process of meeting one’s life goals through the proper management of personal finances.
Q4.
Need for financial advisory services arise because:
Q5.
Which of the following factors imply need for financial advisory services? 1. Strong economic growth 2. Rise in income levels and savings 3. Longer life span, lack of social security and no retirement benefits 4. Complexity of products and need of an informed guidance 5. To beat inflation impacts 6. Plethora of information but in bits and pieces 7. Spanning of joint families 8. Lifestyle and higher aspirations
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Q6.
Which of the following is not a pure advisory service?
Q7.
When a financial planner charges a professional fee for a service like investment planning or comprehensive financial planning, it is known as ___________ and when financial advisor may also opt to provide advisory as a complimentary service while earning a commission on the product sales like mutual funds, banking products etc that take place when the client implements the advice through him is known as ___________.
Q8.
Advisory service which offers act of planning for and prudently addressing life events is:
Q9.
Investment planning determines asset allocation strategies based on the following except:
Q10.
Arrange the process of financial planning delivery in the correct order: 1. Analyzing client’s financial advisory needs 2. Offering the right products and services 3. Establishing client-advisor relationship 4. Understanding client’s situation and goals 5. Monitoring the performance 6. Developing recommendations and strategy
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Q11.
Which of the following does not define net worth?
Q12.
Which of the following is not a financial asset?
Q13.
Which if the following is/are physical assets?
Q14.
Which of the following does not represent common liabilities?
Q15.
The most important determinant of investment planning is not to recommend an asset allocation that offers the best returns but an asset allocation based on the client’s life and financial goals and his risk profile.
Q16.
Which of the following financial ratio/s is/are related to net worth?
Q17.
Which of the following statement/s is/are true in relation to asset allocation? 1. Asset Allocation decision is the most important decision while designing the portfolio. 2. The asset allocation depends on a lot of factors specific to an individual such as his age and risk profile, nature of goal – short-term or long-term, sensitivity of goal to be achieved etc. 3. Only return characteristics are determined by the asset allocation 4. Asset Allocation is also important because it is not possible to be invested in the best asset class at all times. 5. All assets in your portfolio will be impacted to a similar extent by the same factor.
Q18.
A financial advisor believes that the markets are efficient. He is likely to stick to:
Q19.
All of the following about tactical asset allocation are true except:
Q20.
A financial plan review may be undertaken because of:
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