Free CISI Intro Practice Questions: Introduction

Use this focused CISI Intro page as a short practice test for Introduction. The items are original Finance Prep sample exam questions built for scenario-based practice, not trivia, puzzle questions, official CISI questions, copied live-exam content, or exam dumps.

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Sample questions

These are original Finance Prep practice questions aligned to this topic area. They are not official CISI questions, copied live-exam content, or exam dumps. Use them to preview question style and explanation depth before continuing with topic drills, mixed sets, and timed mock exams in Finance Prep.

Question 1

Topic: Introduction

A UK advisory firm does not want to manage money directly. It wants clients to be able to buy and hold funds from several fund managers through one online account, with consolidated statements and dealing administration handled in one place. Which participant is most likely to provide this service?

• A. A custodian safeguarding assets and supporting settlement after trades
• B. An execution-only broker arranging individual securities trades on client instructions
• C. A discretionary investment manager selecting and changing investments for each client
• D. An investment platform providing access to multiple funds and consolidated administration

Best answer: D

What this tests: Introduction

Explanation: Different financial-services participants perform different roles. An investment platform, sometimes described as a wrap platform or fund supermarket, is used to access a range of investments from different providers and to consolidate administration, valuations, reporting and dealing. That matches the firm’s need for one online account and centralised administration without taking on direct investment management. A discretionary investment manager would make investment decisions under a mandate. A custodian focuses on safekeeping assets and settlement support. An execution-only broker mainly executes client instructions rather than providing a multi-provider fund administration hub.

• Discretionary investment management involves selecting and changing investments, which the firm specifically does not want to do.
• Custody is important for safeguarding assets, but it is not the main service described by multi-manager fund access and consolidated online administration.
• Execution-only broking is centred on carrying out trades on instruction, not providing a fund platform with consolidated client reporting.

A platform is designed to give access to products from different providers and handle the associated dealing and administration in one place.

Question 2

Topic: Introduction

A UK investing app gives prospective users the following service summary. Which conclusion is best supported by the summary?

Service: GreenPath Digital Portfolio
How it works: Online questionnaire matches users to one of five model portfolios.
Assets used: OEICs and ETFs, with an optional ESG screen.
Ongoing service: Automated rebalancing and performance reporting in the app.
Charge: Platform fee 0.40% a year, plus fund charges.

• A. It ceases to be investment-related because no face-to-face adviser is mentioned.
• B. It remains an investment-related service, with technology used as the delivery channel.
• C. It is a cash deposit service because the platform fee is shown as a fixed annual percentage.
• D. It removes investment risk because ESG screening and automated rebalancing are available.

Best answer: B

What this tests: Introduction

Explanation: Fintech can change how a financial service is accessed and administered, but it does not necessarily change the service’s basic purpose. The summary describes a digital platform that uses an online questionnaire, model portfolios, OEICs and ETFs, rebalancing, and reporting. Those are all connected with helping users invest and manage a portfolio. The app-based format may make the service more automated or scalable, but the underlying activity remains investment-related. The platform fee is a charge for access or administration, not a deposit rate or guaranteed return.

• Treating the platform fee as a cash deposit rate misreads a charge as a return.
• The absence of a face-to-face adviser does not stop the service from being investment-related.
• ESG screening and automated rebalancing do not remove market risk or guarantee outcomes.

The app is still matching users to portfolios of investment funds and providing ongoing portfolio services, even though the interaction is digital.

Question 3

Topic: Introduction

An adviser firm wants a service that lets its UK retail clients view and administer holdings in OEICs from several fund managers through one online account, including ISA and SIPP wrappers. Which financial-services participant is most likely to provide this service?

• A. Stockbroker
• B. Life insurance company
• C. Investment manager
• D. Investment platform provider

Best answer: D

What this tests: Introduction

Explanation: An investment platform is a distribution and administration service that allows advisers and clients to access a range of investments, often from several fund managers, through a single online account. Platforms commonly provide consolidated valuations, dealing and administrative support, and access to wrappers such as ISAs and SIPPs. A stockbroker is mainly associated with arranging or executing trades in marketable securities. A life insurance company provides insurance-based products and protection contracts. An investment manager makes investment decisions for a portfolio or fund, rather than primarily providing a multi-provider access and administration service.

• A stockbroker may execute trades, but that is narrower than a multi-manager wrapper and administration platform.
• A life insurance company may offer investment-linked products, but the need is access to multiple OEIC providers through one account.
• An investment manager selects and manages investments, but does not primarily provide the described platform access service.

A platform provider gives access to investments from multiple product providers and commonly supports account administration and wrappers such as ISAs and SIPPs.

Question 4

Topic: Introduction

Which of the following is an emerging-theme question rather than a traditional asset-class question?

• A. What is the main purpose of commercial paper?
• B. How might digital platforms change retail investment distribution?
• C. How does an OEIC differ from a unit trust?
• D. What distinguishes a gilt from a corporate bond?

Best answer: B

What this tests: Introduction

Explanation: The core distinction is between sector change and product structure. Emerging-theme questions look at developments affecting how financial services operate, such as digitalisation, fintech, sustainability trends, or changing distribution methods. A question about digital platforms changing retail investment distribution fits this because it asks about how the market and industry are evolving.

By contrast, traditional asset-class questions focus on the nature, features, risks, or uses of a financial instrument or pooled product. Asking about gilts versus corporate bonds, OEICs versus unit trusts, or the purpose of commercial paper is mainly testing product knowledge rather than an emerging theme.

The key test is whether the stem is about change in the sector or about the characteristics of an investment product.

• Gilt versus bond: this is a classic asset-class comparison about debt securities, not an emerging-sector development.
• OEIC versus unit trust: this tests pooled-fund structure and terminology, which is product knowledge rather than sector change.
• Commercial paper: this concerns a money-market instrument and its function, so it remains a traditional instrument question.

This focuses on sector change and industry development, not on the structure or features of a specific security.

Question 5

Topic: Introduction

A UK retail investor has already decided which listed shares to buy. She wants online dealing access and does not want a personal recommendation or ongoing portfolio management. Which service route is the single best fit?

• A. Discretionary portfolio management service
• B. Advisory stockbroking service
• C. Execution-only investment platform or stockbroker
• D. Institutional broker for professional clients

Best answer: C

What this tests: Introduction

Explanation: An execution-only route is used when a client decides what to buy or sell and instructs a firm to carry out the trade. The firm may provide dealing facilities and factual information, but it does not assess suitability or make a personal recommendation. That matches a self-directed retail investor who already knows which listed shares she wants. Advisory services involve a recommendation, while discretionary management gives the manager authority to make investment decisions within an agreed mandate. Institutional broking is aimed at professional market participants rather than a retail investor seeking simple online dealing access.

• Discretionary portfolio management fails because the investor does not want someone else managing the portfolio.
• Advisory stockbroking fails because a personal recommendation is not wanted.
• Institutional broking fails because the scenario describes a retail investor, not a professional client or institution.

Execution-only dealing is appropriate where the investor makes the investment decision and the firm simply arranges the transaction without advice.

Question 6

Topic: Introduction

A customer gives a regulated third-party app permission to access current-account data from several UK banks so the app can show all balances in one place. Which fintech development does this illustrate?

• A. Open banking
• B. Blockchain
• C. Peer-to-peer lending
• D. Robo-advice

Best answer: A

What this tests: Introduction

Explanation: The core concept is open banking, a fintech development that allows customers to share their banking data securely with authorised third-party providers. In the stem, the important features are customer permission, access to current-account data, and the ability to view balances from several banks in one place. That is a classic account-aggregation use of open banking.

Open banking is not simply any digital banking tool. It is specifically about controlled data sharing between banks and authorised external providers, typically through secure technology interfaces. This has supported new services such as spending-analysis apps, account aggregation, and payment initiation. The key takeaway is that the feature being tested is secure, consent-based sharing of bank data, not lending, investment management, or distributed-record technology.

• Blockchain: a distributed ledger technology for recording transactions, not the permission-based sharing framework used to gather account data from multiple banks.
• Peer-to-peer lending: matches borrowers with lenders through an online platform, rather than aggregating a customer’s existing bank-account information.
• Robo-advice: uses algorithms to recommend or manage investments, which is different from displaying banking data from several providers.

Open banking lets authorised third parties access bank-account data securely with the customer’s consent.

Question 7

Topic: Introduction

A UK retail client logs onto an investment platform and buys units in a UK equity OEIC she has chosen herself. The firm gives no personal recommendation, does not assess suitability, and simply carries out her instruction for a dealing fee. Which service role is the firm mainly performing?

• A. Discretionary portfolio management
• B. Investment advice
• C. Execution-only dealing
• D. Market making in equities

Best answer: C

What this tests: Introduction

Explanation: Execution-only means the firm transacts on the client’s instruction without giving a personal recommendation or making the investment decision for them. In this scenario, the underlying product is a UK equity OEIC, but the question is really testing the role the firm is performing. Because the client selected the fund herself, and the firm simply processed the deal for a fee, the correct classification is execution-only dealing.

If the firm had recommended the OEIC to this client, that would point to investment advice. If it had authority to choose and trade investments on the client’s behalf, that would be discretionary portfolio management. The key takeaway is to separate the product being bought from the service being provided.

• Investment advice: this would require a personal recommendation to the client, which the scenario explicitly says was not given.
• Discretionary portfolio management: this applies when the firm makes investment decisions for the client, not when it waits for the client’s instruction.
• Market making in equities: a market maker provides dealing prices in the market; that is different from processing a retail client’s self-directed fund order.

Because the client selected the OEIC herself and the firm only processed the order, the firm is providing an execution-only service.

Question 8

Topic: Introduction

A UK investment firm is separating its customer-facing work into two teams. Team A will deal mainly with individuals and small businesses buying ISAs, unit trusts and other standard investment products. Team B will deal mainly with pension funds, insurance companies, investment managers and large corporate treasuries. Which classification best matches the customer segment served by each team?

• A. Team A is retail business; Team B is professional business.
• B. Both teams are professional business because both operate in regulated financial services.
• C. Both teams are retail business because both involve investment products.
• D. Team A is professional business; Team B is retail business.

Best answer: A

What this tests: Introduction

Explanation: Retail and professional business are mainly distinguished by the type of customer served, not simply by the product being used or whether regulation applies. Retail business typically covers services to private individuals and smaller customers, such as standard savings and investment products. Professional business is aimed at larger, more financially sophisticated customers, including pension schemes, insurers, fund managers, banks and large corporate treasuries. In the scenario, Team A is dealing with individuals and small businesses using standard retail investment products, so it fits retail business. Team B is dealing with institutional and large corporate clients, so it fits professional business.

• Reversing the classifications ignores the customer type: individuals and small businesses are not the main professional segment.
• Treating both teams as retail overlooks the institutional nature of pension funds, insurers and investment managers.
• Treating both teams as professional confuses regulated activity with professional customer business; retail activity is also regulated.

Retail business is aimed at individuals and smaller customers, while professional business serves institutional and larger corporate customers.

Question 9

Topic: Introduction

A UK investment platform gives clients fund factsheets and online dealing access. Clients choose their own investments and place orders themselves. The platform does not make a personal recommendation or assess which investment is suitable. What type of service is this?

• A. Robo-advice
• B. Independent advice
• C. Execution-only service
• D. Restricted advice

Best answer: C

What this tests: Introduction

Explanation: The core concept is whether the firm is advising the client or simply carrying out the client’s instructions. In an execution-only service, the customer selects the investment and the firm executes the order without giving a personal recommendation or assessing suitability.

Independent advice involves a personal recommendation based on a fair and broad analysis of relevant products. Restricted advice also gives a personal recommendation, but within a limited range, provider panel, or product type. Robo-advice still counts as advice when an automated system collects client information and generates a personal recommendation.

Here, the platform only provides factsheets and dealing access, so the pattern clearly matches execution-only rather than any form of advice.

• Independent advice: This would involve a personal recommendation based on a broad review of suitable options, which is absent here.
• Restricted advice: This is still advice, just limited in scope or product range; the stem says no recommendation is made.
• Robo-advice: Automated advice would normally gather client details and produce a recommendation, not just allow self-directed trading.

This is execution-only because the client makes the investment decision without a personal recommendation or suitability assessment.

Question 10

Topic: Introduction

A UK investment platform shows the following process before a customer invests:

The customer may accept the recommendation online or leave without investing. Which type of service is best illustrated?

• A. Restricted advice
• B. Independent advice
• C. Robo-advice
• D. Execution-only service

Best answer: C

What this tests: Introduction

Explanation: Robo-advice is an automated or partly automated way of giving investment advice, usually through an online questionnaire and algorithm. Here, the platform calculates a risk score and uses a portfolio band to show a specific recommendation without a human adviser reviewing it first. That is more than execution-only, because the customer is not simply choosing investments without a recommendation. The facts do not show independent advice, which would require a broad and unbiased assessment of the relevant market. They also do not point mainly to restricted advice, which concerns limits on the range of products or providers considered.

• Execution-only would involve carrying out the customer’s instruction without giving a personal recommendation.
• Independent advice focuses on the scope and impartiality of the market review, not merely on an online scoring process.
• Restricted advice would depend on a stated limit to products, providers, or investment types; the key feature shown is automation.

The platform uses an automated online process to turn the customer’s responses and score into a personal investment recommendation.

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