Guokao CSRC Securities cheat sheet

Role knowledge and relevant Chinese foundations

• Identify the instrument, actor and activity.

• Exchange review and CSRC registration do not guarantee investment value.

• Suitability does not eliminate loss.

• Separate accounting results, cash and a conditional valuation.

• Separate instrument claims, timing, fees and risk.

• Expected return is not a guaranteed outcome.

• Covariance matters for portfolio volatility and diversification has limits.

• Use coherent cash-flow, benchmark and valuation assumptions.

• Expected loss is an average under a stated model, not a maximum.

• VaR does not bound losses or fully describe the tail.

• Funding and market liquidity can deteriorate together.

• Validate models and monitor assumptions, data and intended use.