HKSI LE Paper 3 case studies

HKSI LE Paper 3 · Put your knowledge to work in context.

HKSI Licensing Examination Paper 3, Fundamentals of Securities and Futures Regulation, is the regulation paper set by the Hong Kong Securities and Investment Institute. It tests the legal and regulatory framework that licensed representatives and responsible officers must know: the Securities and Futures Ordinance, the role and powers of the Securities and Futures Commission, licensing and registration, conduct of business and client dealings, market misconduct and disciplinary action, market structure and participants, offers of securities and corporate regulation, and anti-money laundering and counter-terrorist financing. The HKSI LE Paper 3 case studies are 5 cases and about 2,592 words.

Robo-adviser staffing under the SFC licensing regime

Pinnacle Wealth Technologies Limited is a Hong Kong-incorporated fintech with 12 licensed representatives. It plans a mobile app that will route retail clients' orders in Hong Kong-listed shares and US-listed ETFs to a licensed broker for execution, and generate model portfolios from a risk questionnaire.

630 words, about 3 min 2

Suitability and disclosure when selling a leveraged bond fund

At a retail bank's securities desk, relationship manager Kevin advises Mrs Chan, aged 72 and retired, whose risk profile was recorded 18 months ago as 'moderate'. Her liquid assets are HK 2.5 million and her stated objective is stable income.

470 words, about 2 min 3

CFO's tip and late disclosure of inside information

DragonTech Ltd is a HKEX-listed company. On 3 March it learns that its largest customer, representing 40% of revenue, will not renew a contract.

509 words, about 3 min 4

Third-party deposits and a PEP at a brokerage

Orient Capital Securities, a Hong Kong licensed broker, opens a margin account for Mr Wong, a 45-year-old businessman. Within three weeks he deposits HK 8 million from four different companies incorporated in Samoa, Cyprus and the UAE, describing them as 'consultancy fees'.

513 words, about 3 min 5

Private share placement to employees and outside investors

NovaCare Biotech Limited is a Hong Kong-incorporated start-up with 40 employees. It wants to raise HK 30 million by issuing new shares at HK 3 each.

470 words, about 2 min