CSC CX Selection cheat sheet

Regulatory map: CSA (umbrella of provincial commissions) writes harmonized national instruments; IIROC now operates as CIRO alongside the MFDA legacy function; CIPF protects client accounts up to $1,000,000 per client for insolvency, not for market losses.

Dealer categories under NI 31-103: investment dealer (full IIROC/CIRO membership, can be underwriter), mutual fund dealer (restricted to mutual funds and exempt products), exempt market dealer (accredited/eligible investors only), portfolio manager (discretionary management).

Registration categories: dealing representative, advising representative, associate advising representative, portfolio manager, chief compliance officer (CCO). CCO must report directly to the board or senior management and have authority over compliance.

Suitability obligation (NI 31-103 s.13.3): collect KYC, assess suitability of any trade and any account-level recommendation; do not put client in a more leveraged or less liquid position without justification.

Know-your-product (KYP): reasonable steps to understand structure, features, risks, costs, and initial and ongoing suitability of each product recommended; applies to all registrants.

Conflict of interest (NI 31-103 s.13.4): identify and respond to material conflicts in the client's best interest; disclose in writing; avoid conflicts that cannot be managed.

Client relationship model (CRM2): annual report on charges and other compensation, annual performance report (since 2016), pre-trade disclosure of charges, and account statement disclosures.

Complaint handling: written complaint procedures, acknowledgement, and referral to the Ombudsman for Banking Services and Investments (OBSI) after internal escalation; dispute resolution is a regulatory expectation.

Proficiency and continuing education: CIRO requires the Canadian Securities Course plus Conduct and Practices Handbook for dealing representatives, and 12 months of relevant experience (or approved alternatives); annual compliance and product-knowledge CE.

GDP identity: Y = C + I + G + (X − M). Real GDP is nominal deflated by the GDP deflator; nominal growth = real growth + inflation approximately.

Business cycle phases: expansion, peak, contraction (recession), trough. Leading indicators include yield curve slope, building permits, stock prices, and average weekly hours; coincident indicators include industrial production and personal income.

Monetary policy transmission: Bank of Canada sets the overnight rate target and operates the target band; changes affect prime rate, mortgage rates, and the CAD via interest-rate differentials.

Fiscal policy multipliers are larger when the output gap is negative; crowding out reduces the multiplier when the economy is near capacity.

Inflation measures: CPI (fixed basket, includes food and energy), CPI-trim and CPI-median (BoC core measures), and GDP deflator (broadest, includes investment and government).

Yield curve shapes: normal (upward), inverted (short rates above long rates, historically a recession signal), flat, and humped. Expectations hypothesis, liquidity preference, and market segmentation explain shape.

Interest rate parity: forward premium/discount ≈ domestic rate − foreign rate. Purchasing power parity: expected inflation differential drives long-run currency change.

Money supply aggregates: M1 (currency plus chequable deposits), M2 (M1 plus savings and notice deposits), M2+ (adds non-bank deposits). The Bank of Canada targets inflation, not money supply, since 1991.

Equity market drivers: earnings growth, P/E multiple (affected by real rates and risk premium), and dividend policy. Rising real rates compress multiples.

Balance sheet identity: Assets = Liabilities + Shareholders' Equity. Current ratio = current assets / current liabilities; quick ratio excludes inventory and prepaids.

Income statement: Revenue − COGS = Gross profit; − operating expenses = EBITDA; − D&A = EBIT; − interest = pre-tax income; − tax = net income. EPS = (net income − preferred dividends) / weighted average shares.

Cash flow statement: CFO (indirect method starts with net income, adds back non-cash charges, adjusts for working capital), CFI (capex, acquisitions, asset sales), CFF (debt, equity issuance, dividends, buybacks).

Free cash flow: FCFF = CFO + interest × (1 − tax) − capex; FCFE = CFO − capex + net borrowing. FCF is used in DCF valuation.

DuPont decomposition: ROE = net margin × asset turnover × equity multiplier = (NI/Sales) × (Sales/Assets) × (Assets/Equity).

Accrual vs. cash accounting: revenue recognized when earned, expenses matched to revenue. Quality of earnings red flags: rising receivables or inventory relative to sales, growing accruals, frequent non-recurring items.

Inventory methods: FIFO (ending inventory approximates current cost, higher profit in inflation), weighted average, and specific identification. LIFO is not permitted under IFRS.

Depreciation methods: straight-line = (cost − salvage) / useful life; declining balance applies a fixed rate to opening book value; units-of-production ties expense to output.

Time value: FV = PV(1 + r)^n; PV = FV / (1 + r)^n. Annuity PV = PMT × [1 − (1 + r)^−n] / r. Perpetuity PV = PMT / r; growing perpetuity PV = PMT / (r − g).

NPV = Σ CF_t / (1 + r)^t − initial outlay; accept if NPV > 0. IRR is the discount rate making NPV = 0; accept if IRR > cost of capital. Payback ignores time value and cash flows after payback.

WACC = (E/V) × Re + (D/V) × Rd × (1 − tax). Re via CAPM = Rf + β(Rm − Rf). Use market values of debt and equity, not book.

CAPM beta measures systematic risk; unsystematic risk is diversifiable and not compensated. Beta = Cov(stock, market) / Var(market).

Dividend discount model: P0 = D1 / (r − g), with g = retention ratio × ROE. Gordon growth assumes g < r and stable payout.

Relative valuation: P/E = payout ratio / (r − g); P/B = (ROE − g) / (r − g); EV/EBITDA is capital-structure neutral.

Capital structure: Modigliani-Miller without taxes says firm value is independent of leverage; with taxes, value rises by tax rate × debt (interest tax shield), offset by financial distress costs.

Dividend policy: in a perfect market, dividend policy is irrelevant (homemade dividends). In practice, signaling, clientele effects, and taxes matter. Share buybacks are an alternative return of capital.

Project evaluation: use incremental cash flows, ignore sunk costs, include opportunity costs and working-capital changes, and treat cannibalization explicitly.

Bond price = Σ coupon / (1 + y)^t + face / (1 + y)^n. Price and yield move inversely. Premium bond: coupon > yield; discount bond: coupon < yield.

Duration: Macaulay duration is the weighted average time to cash flows; modified duration = Macaulay / (1 + y/m). Approximate % price change ≈ −modified duration × Δy.

Convexity adjustment: %ΔP ≈ −D_mod × Δy + ½ × convexity × (Δy)². Positive convexity means price gains exceed losses for equal yield moves.

Money market instruments: T-bills (discount basis), commercial paper (corporate unsecured, up to 1 year), banker's acceptances, and repo. T-bill price = face × (1 − discount rate × days/365).

Term structure theories: expectations (long rates = average expected short rates), liquidity preference (long rates include a premium), market segmentation (supply and demand per maturity).

Credit risk: rating agencies (DBRS Morningstar, Moody's, S&P, Fitch); spread compensates for default risk and liquidity. Investment grade is BBB−/Baa3 and above.

Bond features: callable (issuer right, hurts investor, lower price), putable (investor right, higher price), convertible (bond plus equity option), sinking fund, and covenants.

Interest rate risk measures: duration, convexity, and basis-point value (price value of a basis point). Longer maturity and lower coupon mean higher duration.

Real return bond: principal indexed to CPI, real coupon fixed; protects against inflation. Nominal bond exposes holder to inflation risk.

Common share rights: residual claim on assets and earnings, voting, pre-emptive rights (rights offerings), and limited liability. Preferred shares rank ahead on dividends and liquidation but typically lack votes.

Preferred share types: cumulative (unpaid dividends accrue), non-cumulative, participating, retractable, and floating-rate. Dividends are fixed and paid before common dividends.

Order types: market, limit, stop (becomes market when triggered), stop-limit, and all-or-none. Short selling involves borrowing shares and buying back later; loss is theoretically unlimited.

Margin accounts: initial margin requirement set by CIRO (typically 50% for equities), maintenance margin lower; margin calls triggered when equity falls below maintenance.

Equity-linked notes and structured products: principal-protected notes combine a bond with an option payoff; leverage notes magnify both gains and losses.

Stock splits and consolidations change share count but not market cap; dividends and rights issues require price adjustment for valuation continuity.

Valuation multiples: trailing vs. forward P/E, P/B, P/S, dividend yield = annual dividend / price, and total return = (price change + dividends) / initial price.

Market indices: price-weighted (Dow), capitalization-weighted (S&P/TSX Composite), and equal-weighted. Cap-weighted indices are dominated by large firms.

Types of equity risk: market (systematic), sector, and company-specific. Diversification reduces unsystematic risk but not market risk.

Option payoff at expiry: call buyer max(S − K, 0); put buyer max(K − S, 0). Option premium = intrinsic value + time value.

Moneyness: in-the-money, at-the-money, out-of-the-money. Intrinsic value for a call = max(S − K, 0); for a put = max(K − S, 0).

Put-call parity (European, no dividends): C − P = S − K / (1 + r)^T. Violations create arbitrage opportunities.

Option Greeks: delta (price sensitivity), gamma (delta change), theta (time decay), vega (volatility sensitivity), rho (interest-rate sensitivity).

Futures vs. forwards: futures are exchange-traded, standardized, marked to market daily, and cleared; forwards are OTC, customized, and carry counterparty risk.

Hedging with futures: short hedge protects a long asset position; long hedge locks in a purchase price. Basis risk = spot price − futures price.

Cost of carry: futures price ≈ spot × (1 + r)^T − carry (storage, dividends). For financial assets, F = S × (1 + r − dividend yield)^T.

Covered call: long stock plus short call, caps upside, generates premium. Protective put: long stock plus long put, floors downside.

Swap: agreement to exchange cash flows; interest rate swap exchanges fixed for floating; currency swap exchanges principal and interest in different currencies.

Mutual fund structures: open-end (redeemable at NAV per share) and closed-end (trades on exchange, may trade at premium or discount to NAV). NAV = (total assets − liabilities) / shares outstanding.

Management expense ratio (MER): management fee plus operating expenses plus taxes, expressed as a percentage of average net assets. Trading expense ratio (TER) is disclosed separately.

Sales charge options: front-end load (commission at purchase), back-end load or DSC (declining redemption fee, largely phased out), and low/no-load.

ETF features: intraday trading, creation/redemption by authorized participants, typically lower MER, tracking error vs. tracking difference.

Hedge funds: exempt from prospectus, accredited investors only, use leverage, short selling, and derivatives; fee structure typically 2% management plus 20% performance.

Segregated funds: insurance contracts with maturity and death guarantees (75% or 100% of deposits), creditor protection, and estate bypass; MER higher than mutual funds.

Principal-protected notes (PPNs): deposit or debt plus an option; principal guaranteed at maturity, participation rate caps upside, and issuer credit risk applies.

Pooled funds and segregated pools: commingled assets for institutional or high-net-worth investors, often lower cost and tax-efficient.

Fund taxation: mutual fund trusts flow through income and capital gains to unitholders; capital gains distributions increase ACB and are not new wealth.

Expected portfolio return: E(Rp) = Σ w_i × E(R_i). Portfolio variance = Σ Σ w_i w_j Cov(i,j); for two assets, σp² = w1²σ1² + w2²σ2² + 2w1w2ρσ1σ2.

Diversification benefit depends on correlation: ρ = +1 gives no risk reduction; ρ = −1 can eliminate risk entirely; ρ = 0 gives partial reduction.

Efficient frontier: set of portfolios with the highest expected return for each level of risk. Adding a risk-free asset creates the capital market line; the tangency portfolio is the market portfolio.

Sharpe ratio = (Rp − Rf) / σp. Treynor ratio = (Rp − Rf) / βp. Jensen's alpha = Rp − [Rf + β(Rm − Rf)].

Asset allocation: strategic (long-term policy weights) vs. tactical (short-term deviations). Rebalancing restores target weights and enforces buy-low/sell-high.

Investment policy statement (IPS): objectives (return and risk), constraints (liquidity, time horizon, tax, legal, unique), and review procedures.

Behavioral biases: loss aversion, overconfidence, anchoring, recency, and herd behavior; they cause suboptimal asset allocation and excessive trading.

Performance measurement: time-weighted return removes cash-flow timing effects; money-weighted return (IRR) reflects investor timing. Benchmark must match style and risk.

Rebalancing methods: calendar (periodic) and threshold (tolerance bands). Tax-aware rebalancing uses asset location and loss harvesting.

KYC data elements: age, income, net worth, investment knowledge and experience, risk tolerance, time horizon, liquidity needs, and investment objectives.

Risk tolerance vs. risk capacity: tolerance is willingness to accept risk; capacity is financial ability to absorb losses. Both must be assessed.

Suitability assessment: match product risk, liquidity, and cost to the client profile; document the rationale; reassess on material change in circumstances.

Investment objectives categories: income, growth, capital preservation, speculation, and combinations. Time horizon: short (<3 years), medium (3-10), long (>10).

Client communication: disclosure of fees, conflicts, and risks in plain language; pre-trade disclosure of charges; annual relationship disclosure.

Account types: cash, margin, RRSP, TFSA, RESP, RRIF, and non-registered. Tax treatment differs; contribution limits and withdrawal rules apply.

Vulnerable clients: cognitive decline, undue influence, and elder financial abuse require extra care, documentation, and escalation.

Complaint and dispute resolution: internal complaint process, OBSI escalation, and limitation periods. Keep records of all client instructions.

New account opening: identity verification (FINTRAC), suitability assessment, and signed client agreement before trading.

Fiduciary vs. suitability standard: portfolio managers and advisers owe a fiduciary duty (act in client's best interest); dealing representatives must ensure suitability.

CIRO Conduct and Practices Handbook rules: integrity, honesty, fair dealing, confidentiality, and avoidance of conflicts.

Insider trading: trading on material non-public information is prohibited; tipping is also prohibited. Materiality and non-public status are the tests.

Market manipulation: wash trading, painting the tape, spoofing, and pump-and-dump schemes are prohibited.

Personal trading: pre-clearance, restricted lists, blackout periods, and disclosure of outside business activities.

Anti-money laundering: FINTRAC reporting (large cash, suspicious transactions), know-your-client, and record keeping.

Privacy: PIPEDA governs collection, use, and disclosure of personal information; obtain consent and safeguard data.

Conflicts of interest: disclose in writing, manage or avoid; compensation arrangements (commissions, referral fees) must be disclosed.

Ethical decision framework: identify the issue, gather facts, consider stakeholders and rules, evaluate alternatives, act, and document.

Time value: FV = PV(1 + r)^n; PV = FV / (1 + r)^n. Annuity PV = PMT × [1 − (1 + r)^−n] / r. Perpetuity PV = PMT / r; growing perpetuity PV = PMT / (r − g).

NPV = Σ CF_t / (1 + r)^t − initial outlay; accept if NPV > 0. IRR is the discount rate making NPV = 0; accept if IRR > cost of capital. Payback ignores time value and cash flows after payback.

WACC = (E/V) × Re + (D/V) × Rd × (1 − tax). Re via CAPM = Rf + β(Rm − Rf). Use market values of debt and equity, not book.

CAPM beta measures systematic risk; unsystematic risk is diversifiable and not compensated. Beta = Cov(stock, market) / Var(market).

Dividend discount model: P0 = D1 / (r − g), with g = retention ratio × ROE. Gordon growth assumes g < r and stable payout.

Relative valuation: P/E = payout ratio / (r − g); P/B = (ROE − g) / (r − g); EV/EBITDA is capital-structure neutral.

Capital structure: Modigliani-Miller without taxes says firm value is independent of leverage; with taxes, value rises by tax rate × debt (interest tax shield), offset by financial distress costs.

Dividend policy: in a perfect market, dividend policy is irrelevant (homemade dividends). In practice, signaling, clientele effects, and taxes matter. Share buybacks are an alternative return of capital.

Project evaluation: use incremental cash flows, ignore sunk costs, include opportunity costs and working-capital changes, and treat cannibalization explicitly.

Balance sheet identity: Assets = Liabilities + Shareholders' Equity. Current ratio = current assets / current liabilities; quick ratio excludes inventory and prepaids.

Income statement: Revenue − COGS = Gross profit; − operating expenses = EBITDA; − D&A = EBIT; − interest = pre-tax income; − tax = net income. EPS = (net income − preferred dividends) / weighted average shares.

Cash flow statement: CFO (indirect method starts with net income, adds back non-cash charges, adjusts for working capital), CFI (capex, acquisitions, asset sales), CFF (debt, equity issuance, dividends, buybacks).

Free cash flow: FCFF = CFO + interest × (1 − tax) − capex; FCFE = CFO − capex + net borrowing. FCF is used in DCF valuation.

DuPont decomposition: ROE = net margin × asset turnover × equity multiplier = (NI/Sales) × (Sales/Assets) × (Assets/Equity).

Accrual vs. cash accounting: revenue recognized when earned, expenses matched to revenue. Quality of earnings red flags: rising receivables or inventory relative to sales, growing accruals, frequent non-recurring items.

Inventory methods: FIFO (ending inventory approximates current cost, higher profit in inflation), weighted average, and specific identification. LIFO is not permitted under IFRS.

Depreciation methods: straight-line = (cost − salvage) / useful life; declining balance applies a fixed rate to opening book value; units-of-production ties expense to output.

Time value: FV = PV(1 + r)^n; PV = FV / (1 + r)^n. Annuity PV = PMT × [1 − (1 + r)^−n] / r. Perpetuity PV = PMT / r; growing perpetuity PV = PMT / (r − g).

NPV = Σ CF_t / (1 + r)^t − initial outlay; accept if NPV > 0. IRR is the discount rate making NPV = 0; accept if IRR > cost of capital. Payback ignores time value and cash flows after payback.

WACC = (E/V) × Re + (D/V) × Rd × (1 − tax). Re via CAPM = Rf + β(Rm − Rf). Use market values of debt and equity, not book.

CAPM beta measures systematic risk; unsystematic risk is diversifiable and not compensated. Beta = Cov(stock, market) / Var(market).

Dividend discount model: P0 = D1 / (r − g), with g = retention ratio × ROE. Gordon growth assumes g < r and stable payout.

Relative valuation: P/E = payout ratio / (r − g); P/B = (ROE − g) / (r − g); EV/EBITDA is capital-structure neutral.

Capital structure: Modigliani-Miller without taxes says firm value is independent of leverage; with taxes, value rises by tax rate × debt (interest tax shield), offset by financial distress costs.

Dividend policy: in a perfect market, dividend policy is irrelevant (homemade dividends). In practice, signaling, clientele effects, and taxes matter. Share buybacks are an alternative return of capital.

Project evaluation: use incremental cash flows, ignore sunk costs, include opportunity costs and working-capital changes, and treat cannibalization explicitly.

Bond price = Σ coupon / (1 + y)^t + face / (1 + y)^n. Price and yield move inversely. Premium bond: coupon > yield; discount bond: coupon < yield.

Duration: Macaulay duration is the weighted average time to cash flows; modified duration = Macaulay / (1 + y/m). Approximate % price change ≈ −modified duration × Δy.

Convexity adjustment: %ΔP ≈ −D_mod × Δy + ½ × convexity × (Δy)². Positive convexity means price gains exceed losses for equal yield moves.

Money market instruments: T-bills (discount basis), commercial paper (corporate unsecured, up to 1 year), banker's acceptances, and repo. T-bill price = face × (1 − discount rate × days/365).

Term structure theories: expectations (long rates = average expected short rates), liquidity preference (long rates include a premium), market segmentation (supply and demand per maturity).

Credit risk: rating agencies (DBRS Morningstar, Moody's, S&P, Fitch); spread compensates for default risk and liquidity. Investment grade is BBB−/Baa3 and above.

Bond features: callable (issuer right, hurts investor, lower price), putable (investor right, higher price), convertible (bond plus equity option), sinking fund, and covenants.

Interest rate risk measures: duration, convexity, and basis-point value (price value of a basis point). Longer maturity and lower coupon mean higher duration.

Real return bond: principal indexed to CPI, real coupon fixed; protects against inflation. Nominal bond exposes holder to inflation risk.

Common share rights: residual claim on assets and earnings, voting, pre-emptive rights (rights offerings), and limited liability. Preferred shares rank ahead on dividends and liquidation but typically lack votes.

Preferred share types: cumulative (unpaid dividends accrue), non-cumulative, participating, retractable, and floating-rate. Dividends are fixed and paid before common dividends.

Order types: market, limit, stop (becomes market when triggered), stop-limit, and all-or-none. Short selling involves borrowing shares and buying back later; loss is theoretically unlimited.

Margin accounts: initial margin requirement set by CIRO (typically 50% for equities), maintenance margin lower; margin calls triggered when equity falls below maintenance.

Equity-linked notes and structured products: principal-protected notes combine a bond with an option payoff; leverage notes magnify both gains and losses.

Stock splits and consolidations change share count but not market cap; dividends and rights issues require price adjustment for valuation continuity.

Valuation multiples: trailing vs. forward P/E, P/B, P/S, dividend yield = annual dividend / price, and total return = (price change + dividends) / initial price.

Market indices: price-weighted (Dow), capitalization-weighted (S&P/TSX Composite), and equal-weighted. Cap-weighted indices are dominated by large firms.

Types of equity risk: market (systematic), sector, and company-specific. Diversification reduces unsystematic risk but not market risk.

Option payoff at expiry: call buyer max(S − K, 0); put buyer max(K − S, 0). Option premium = intrinsic value + time value.

Moneyness: in-the-money, at-the-money, out-of-the-money. Intrinsic value for a call = max(S − K, 0); for a put = max(K − S, 0).

Put-call parity (European, no dividends): C − P = S − K / (1 + r)^T. Violations create arbitrage opportunities.

Option Greeks: delta (price sensitivity), gamma (delta change), theta (time decay), vega (volatility sensitivity), rho (interest-rate sensitivity).

Futures vs. forwards: futures are exchange-traded, standardized, marked to market daily, and cleared; forwards are OTC, customized, and carry counterparty risk.

Hedging with futures: short hedge protects a long asset position; long hedge locks in a purchase price. Basis risk = spot price − futures price.

Cost of carry: futures price ≈ spot × (1 + r)^T − carry (storage, dividends). For financial assets, F = S × (1 + r − dividend yield)^T.

Covered call: long stock plus short call, caps upside, generates premium. Protective put: long stock plus long put, floors downside.

Swap: agreement to exchange cash flows; interest rate swap exchanges fixed for floating; currency swap exchanges principal and interest in different currencies.

Mutual fund structures: open-end (redeemable at NAV per share) and closed-end (trades on exchange, may trade at premium or discount to NAV). NAV = (total assets − liabilities) / shares outstanding.

Management expense ratio (MER): management fee plus operating expenses plus taxes, expressed as a percentage of average net assets. Trading expense ratio (TER) is disclosed separately.

Sales charge options: front-end load (commission at purchase), back-end load or DSC (declining redemption fee, largely phased out), and low/no-load.

ETF features: intraday trading, creation/redemption by authorized participants, typically lower MER, tracking error vs. tracking difference.

Hedge funds: exempt from prospectus, accredited investors only, use leverage, short selling, and derivatives; fee structure typically 2% management plus 20% performance.

Segregated funds: insurance contracts with maturity and death guarantees (75% or 100% of deposits), creditor protection, and estate bypass; MER higher than mutual funds.

Principal-protected notes (PPNs): deposit or debt plus an option; principal guaranteed at maturity, participation rate caps upside, and issuer credit risk applies.

Pooled funds and segregated pools: commingled assets for institutional or high-net-worth investors, often lower cost and tax-efficient.

Fund taxation: mutual fund trusts flow through income and capital gains to unitholders; capital gains distributions increase ACB and are not new wealth.

Expected portfolio return: E(Rp) = Σ w_i × E(R_i). Portfolio variance = Σ Σ w_i w_j Cov(i,j); for two assets, σp² = w1²σ1² + w2²σ2² + 2w1w2ρσ1σ2.

Diversification benefit depends on correlation: ρ = +1 gives no risk reduction; ρ = −1 can eliminate risk entirely; ρ = 0 gives partial reduction.

Efficient frontier: set of portfolios with the highest expected return for each level of risk. Adding a risk-free asset creates the capital market line; the tangency portfolio is the market portfolio.

Sharpe ratio = (Rp − Rf) / σp. Treynor ratio = (Rp − Rf) / βp. Jensen's alpha = Rp − [Rf + β(Rm − Rf)].

Asset allocation: strategic (long-term policy weights) vs. tactical (short-term deviations). Rebalancing restores target weights and enforces buy-low/sell-high.

Investment policy statement (IPS): objectives (return and risk), constraints (liquidity, time horizon, tax, legal, unique), and review procedures.

Behavioral biases: loss aversion, overconfidence, anchoring, recency, and herd behavior; they cause suboptimal asset allocation and excessive trading.

Performance measurement: time-weighted return removes cash-flow timing effects; money-weighted return (IRR) reflects investor timing. Benchmark must match style and risk.

Rebalancing methods: calendar (periodic) and threshold (tolerance bands). Tax-aware rebalancing uses asset location and loss harvesting.

KYC data elements: age, income, net worth, investment knowledge and experience, risk tolerance, time horizon, liquidity needs, and investment objectives.

Risk tolerance vs. risk capacity: tolerance is willingness to accept risk; capacity is financial ability to absorb losses. Both must be assessed.

Suitability assessment: match product risk, liquidity, and cost to the client profile; document the rationale; reassess on material change in circumstances.

Investment objectives categories: income, growth, capital preservation, speculation, and combinations. Time horizon: short (<3 years), medium (3-10), long (>10).

Client communication: disclosure of fees, conflicts, and risks in plain language; pre-trade disclosure of charges; annual relationship disclosure.

Account types: cash, margin, RRSP, TFSA, RESP, RRIF, and non-registered. Tax treatment differs; contribution limits and withdrawal rules apply.

Vulnerable clients: cognitive decline, undue influence, and elder financial abuse require extra care, documentation, and escalation.

Complaint and dispute resolution: internal complaint process, OBSI escalation, and limitation periods. Keep records of all client instructions.

New account opening: identity verification (FINTRAC), suitability assessment, and signed client agreement before trading.

Fiduciary vs. suitability standard: portfolio managers and advisers owe a fiduciary duty (act in client's best interest); dealing representatives must ensure suitability.

CIRO Conduct and Practices Handbook rules: integrity, honesty, fair dealing, confidentiality, and avoidance of conflicts.

Insider trading: trading on material non-public information is prohibited; tipping is also prohibited. Materiality and non-public status are the tests.

Market manipulation: wash trading, painting the tape, spoofing, and pump-and-dump schemes are prohibited.

Personal trading: pre-clearance, restricted lists, blackout periods, and disclosure of outside business activities.

Anti-money laundering: FINTRAC reporting (large cash, suspicious transactions), know-your-client, and record keeping.

Privacy: PIPEDA governs collection, use, and disclosure of personal information; obtain consent and safeguard data.

Conflicts of interest: disclose in writing, manage or avoid; compensation arrangements (commissions, referral fees) must be disclosed.

Ethical decision framework: identify the issue, gather facts, consider stakeholders and rules, evaluate alternatives, act, and document.