CISI Investment Advice Diploma study guide
CISI Investment Advice Diploma · Work through your exam, one topic at a time.
The CISI Investment Advice Diploma (often shortened to IAD) is a Level 4 professional qualification awarded by the Chartered Institute for Securities & Investment. It sits at the standard expected of someone giving regulated investment advice in the UK, and it is commonly taken by trainee advisers, paraplanners moving into advisory roles, and staff in wealth management, private banking and discretionary firms who need a recognised technical benchmark. The CISI Investment Advice Diploma study guide has 8 sections and about 3,700 words.
01Financial Markets and Instruments
This domain tests how markets are organised and how the main instrument families behave. Questions focus on market participants, primary versus secondary activity, settlement mechanics, and the risk and return features of cash, bonds, equities and derivatives.
447 words, about 2 min02Investment Principles, Risk and Return
This domain tests the relationship between risk and expected return, the difference between real and nominal outcomes, and the principles of diversification. Candidates must distinguish volatility from permanent loss and risk tolerance from capacity for loss.
457 words, about 2 min03Investment Analysis and Valuation
This domain tests how analysts value equities and bonds, interpret financial statements and use relative valuation. Questions often require choosing the right model, applying it correctly and recognising when a model’s assumptions fail.
469 words, about 2 min04Portfolio Construction and Asset Allocation
This domain tests how portfolios are built from an investment policy statement, how strategic and tactical allocation differ, and how correlation and rebalancing affect risk. The exam expects candidates to apply portfolio mathematics rather than describe diversification generically.
465 words, about 2 min05Client Advice, Suitability and Investment Planning
This domain tests the advice process: gathering client information, assessing affordability and capacity for loss, matching recommendations to objectives, and documenting suitability. It is applied, not theoretical, and often uses short client scenarios.
478 words, about 2 min06Regulation, Ethics and Professional Conduct
This domain tests the UK regulatory framework and ethical decision-making. Candidates must know the FCA’s Principles for Businesses, conduct rules and the standards expected when conflicts, inducements and client money are involved.
478 words, about 2 min07Taxation and Tax-Efficient Investment
This domain tests UK tax rules as they apply to investments and wrappers. Candidates must calculate gains and income tax, select suitable wrappers, and recognise where tax relief interacts with investment suitability.
466 words, about 2 min08Investment Products and Services
This domain tests the features, risks and uses of collective investments, investment trusts, ETFs, bonds, structured products and advice services. Questions often compare structures on cost, liquidity, gearing and counterparty risk.
440 words, about 2 min