Use this syllabus as your checklist for CSC Exam 2. The topics and weightings are aligned to CSI’s official CSC blueprint, and sections map 1:1 to the CSI curriculum chapters used for Exam 2 (Chapters 13–27).
Official sources (CSI):
Official topic weightings (Exam 2)
| Topic | Weight | Target questions (of 100) |
|---|
| Investment Analysis | 18% | 18 |
| Portfolio Analysis | 18% | 18 |
| Mutual Funds | 14% | 14 |
| Exchange-Traded Funds | 10% | 10 |
| Alternative Investments, Other Managed, and Structured Products | 16% | 16 |
| Canadian Taxation | 6% | 6 |
| Fee-Based Accounts and Working with the Retail Client | 8% | 8 |
| Working with the Institutional Client | 10% | 10 |
What’s covered
Investment Analysis (18%)
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Chapter 13 - Fundamental and Technical Analysis
- Differentiate methods of equity analysis (fundamental vs technical) and when each is used conceptually.
- Describe fundamental macroeconomic analysis and identify key macro factors affecting securities (conceptual).
- Describe fundamental industry analysis and why industry structure affects company performance (conceptual).
- Describe technical analysis at a high level and what market data it uses.
- Recognize strengths and limitations of fundamental vs technical approaches (conceptual).
- Identify how analysts use economic, market, and industry information to form recommendations (conceptual).
- Interpret a basic macro scenario and identify which securities might be most affected (conceptual).
- Identify qualitative factors in industry analysis (competition, regulation, cyclicality) conceptually.
- Recognize common technical concepts (trend, support/resistance) at a high level.
- Differentiate leading vs lagging indicators conceptually in analysis contexts.
- Apply an analysis approach to a scenario by choosing which method fits the question being asked.
- Recognize the need to state assumptions and limitations when presenting analysis (conceptual).
- Given a scenario, choose the most appropriate conclusion that aligns with the selected method and evidence.
Chapter 14 - Company Analysis
- Describe the steps in performing company analysis and the purpose of issuer evaluation.
- Interpret basic financial statements for company analysis (income, balance sheet, cash flow) conceptually.
- Identify key categories of financial ratios (liquidity, profitability, leverage, efficiency) at a high level.
- Analyze how changes in ratios can signal improving or deteriorating fundamentals (conceptual).
- Recognize limitations of ratio analysis (accounting differences, one-time items) conceptually.
- Identify how preferred share investment quality can be assessed (issuer creditworthiness and dividend safety) conceptually.
- Differentiate earnings quality vs reported earnings at a high level (conceptual).
- Apply company analysis to a scenario to identify the biggest fundamental risk (leverage, liquidity, profitability).
- Choose which financial statement line items are most relevant for a described analysis question (conceptual).
- Compare two companies at a high level using provided ratio information (interpretation).
- Recognize how disclosure and annual reports support company analysis (conceptual).
- Interpret how business model and industry position influence ratios and valuation (conceptual).
- Given a scenario, choose the best conclusion that is supported by the provided company information.
Portfolio Analysis (18%)
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Chapter 15 - Introduction to the Portfolio Approach
- Define risk and return in an investment context and identify common risk measures conceptually.
- Explain the trade-off between risk and expected return and how it influences investor choices.
- Describe how diversification affects portfolio risk and the role of correlation conceptually.
- Explain the relationship between risk and return in a portfolio (systematic vs unsystematic risk) conceptually.
- Identify how combining assets can change portfolio risk without changing expected return (diversification benefit) conceptually.
- Describe portfolio manager styles at a high level (growth, value, income, index, tactical) conceptually.
- Recognize how investment constraints (horizon, liquidity, taxes) affect risk and return decisions conceptually.
- Interpret a simple portfolio scenario and identify the primary risk driver (concentration, duration, credit).
- Choose which portfolio manager style best matches a client objective and constraints (conceptual).
- Recognize why benchmarks matter when evaluating portfolio strategy (conceptual).
- Differentiate absolute return vs relative return thinking conceptually.
- Apply expected return thinking to compare two portfolio options (conceptual).
- Given a scenario, identify the most appropriate diversification action to reduce unsystematic risk.
Chapter 16 - The Portfolio Management Process
- Describe the portfolio management process and how it connects objectives, strategy, implementation, and monitoring.
- Apply Step 1 to a scenario: determine investment objectives and constraints (horizon, liquidity, risk, taxes).
- Apply Step 2 to a scenario: draft an investment policy statement (IPS) that captures objectives and constraints.
- Apply Step 3: develop an asset mix consistent with objectives and risk profile (conceptual).
- Apply Step 4: select securities or managed products consistent with the asset mix and constraints (conceptual).
- Describe Step 5 monitoring: monitor the client, market, and economy and identify common review triggers (conceptual).
- Describe Step 6 evaluation: evaluate portfolio performance using appropriate measures (conceptual).
- Describe Step 7 rebalancing: rebalance the portfolio using time-based or threshold-based rules (conceptual).
- Recognize documentation requirements at each step (KYC updates, rationale, disclosures) conceptually.
- Diagnose a case where the process failed (missing IPS, unsuitable asset mix, lack of monitoring) and choose the corrective step.
- Choose the most appropriate next step when client circumstances change (update objectives/constraints, revise IPS).
- Interpret how costs, taxes, and liquidity constraints affect implementation choices (conceptual).
- Given a scenario, choose the most defensible portfolio action and documentation step.
Mutual Funds (14%)
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Chapter 17 - Mutual Funds: Structure and Regulation
- Describe managed products and where mutual funds fit within managed product categories.
- Describe mutual fund structure (fund, units, NAV) and roles (manager, trustee, custodian) conceptually.
- Explain how mutual fund units are priced and how NAV is calculated conceptually.
- Differentiate mutual fund purchase/redemption at NAV from exchange trading (contrast with ETFs) conceptually.
- Describe mutual fund regulation at a high level and why investor protection rules exist.
- Identify common mutual fund disclosure and documentation requirements conceptually.
- Recognize the role of the Know Your Client (KYC) rule in mutual fund suitability decisions.
- Apply KYC to a scenario to select an appropriate mutual fund type consistent with objectives and constraints.
- Identify requirements for opening and updating an account (documentation and KYC updates) conceptually.
- Recognize common mutual fund sales practice risks (misleading performance, inappropriate recommendations) conceptually.
- Interpret sales charges and ongoing fees (including MER) and their impact on investor returns conceptually.
- Given a scenario, choose the most appropriate compliance step when mutual fund KYC information is incomplete or stale.
- Given a scenario, identify what must be disclosed and documented before the client purchases a fund.
Chapter 18 - Mutual Funds: Types and Features
- Identify types of mutual funds (money market, bond, equity, balanced, specialty) at a high level.
- Differentiate fund management styles (active vs passive; growth vs value) conceptually.
- Describe how mutual fund units or shares are redeemed and common redemption considerations (timing and fees) conceptually.
- Recognize how fund distributions can occur (income, dividends, capital gains, return of capital) conceptually.
- Describe common measures of mutual fund performance and why time period and benchmarks matter.
- Differentiate performance measures (total return) from cash distributions (conceptual).
- Recognize common risk measures used for funds (volatility and downside risk) conceptually.
- Apply suitability thinking to a scenario by selecting a fund type aligned to horizon, liquidity, and risk profile.
- Interpret how fees and turnover can affect long-run fund performance conceptually.
- Recognize the impact of market conditions on fund performance and style cycles (conceptual).
- Compare two funds at a high level using objectives, fees, and performance context (conceptual).
- Given a scenario, identify the most important fund feature to disclose (risk, liquidity, fees).
- Given a scenario, choose the best next step when a client wants to redeem during market stress (process and suitability).
Exchange-Traded Funds (10%)
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Chapter 19 - Exchange-Traded Funds
- Describe the regulation and structure of exchange-traded funds (ETFs) at a high level.
- Identify key features of ETFs (intraday trading and transparency) conceptually.
- Differentiate types of ETFs (broad market, sector, thematic, fixed income) at a high level.
- Identify risks of investing in ETFs (market, liquidity/spread, tracking error) conceptually.
- Compare ETFs and mutual funds in trading mechanics, pricing, costs, and typical use cases.
- Describe taxation considerations for ETF investors at a high level (conceptual).
- Identify investment strategies using ETFs (core allocation, tilts, tactical) conceptually.
- Recognize how ETF trading involves bid/ask spreads and potential premiums/discounts to NAV (conceptual).
- Given a client scenario, choose whether an ETF or mutual fund is a better fit and justify based on constraints.
- Given a scenario, identify the ETF risk most relevant to the investor (liquidity, concentration, or complexity).
- Interpret how ETF type (for example, inverse/leveraged) changes suitability and risk disclosure needs (conceptual).
- Identify other related products referenced in ETF discussions and how they may differ conceptually.
Alternative Investments, Other Managed, and Structured Products (16%)
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Chapter 20 - Alternative Investments: Benefits, Risks, and Structure
- Define alternative investments and identify common categories (hedge funds and alternative mutual funds) conceptually.
- Explain benefits and risks of investing in alternatives (diversification, illiquidity, leverage, complexity) conceptually.
- Describe alternative investment structures and how they differ from conventional mutual funds at a high level.
- Compare alternative mutual funds with conventional mutual funds and hedge funds conceptually (liquidity, constraints, regulation).
- Recognize common alternative investment risk drivers (strategy risk, manager risk, liquidity) conceptually.
- Identify suitability considerations for alternatives (time horizon, risk capacity, sophistication) conceptually.
- Interpret how alternatives may affect portfolio risk/return in an asset allocation context (conceptual).
- Identify fee structures commonly associated with alternatives and why fees matter (conceptual).
- Recognize the importance of disclosure and due diligence for alternative products (conceptual).
- Given a scenario, identify whether an alternative product is appropriate given liquidity needs and risk tolerance.
- Given a scenario, choose the most important risk to disclose for an alternative investment (leverage, illiquidity, complexity).
- Recognize how diversification claims can be overstated and why correlation can change in stress (conceptual).
- Given a scenario, choose the most defensible next step when the product structure is not fully understood (seek KYP information).
- Identify common alternative investment strategies at a high level (conceptual).
- Describe alternative strategy fund performance measurement concepts at a high level.
- Differentiate absolute-return objectives from benchmark-relative objectives in alternative strategies conceptually.
- Recognize how return distributions can differ for alternative strategies (skew and tail risk) conceptually.
- Apply a due diligence process to an alternative strategy (strategy, risks, fees, liquidity, governance) conceptually.
- Identify suitability considerations for alternative strategies based on client constraints.
- Interpret scenario evidence that a client should not use an alternative strategy (liquidity needs, low capacity, complexity).
- Recognize common risk controls and limits for alternative strategies conceptually.
- Compare two alternative strategies conceptually based on how they generate returns and risks.
- Identify why performance assessment can be difficult for alternatives (short history, survivorship) conceptually.
- Given a scenario, choose the most appropriate disclosure and documentation action for an alternative recommendation.
- Recognize how alternatives can interact with taxation and account structures conceptually.
- Given a scenario, choose the alternative strategy concept most consistent with the described return pattern (conceptual).
Chapter 22 - Other Managed Products
- Describe segregated funds and how they differ from mutual funds at a high level (structure and guarantees conceptually).
- Describe labour-sponsored venture capital corporations (LSVCCs) conceptually and identify key characteristics.
- Describe closed-end funds and how their pricing/trading differs from open-end funds (conceptual).
- Describe income trusts and what drives their distributions and risks conceptually.
- Describe listed private equity conceptually and recognize how it differs from public equities.
- Identify common risks across other managed products (liquidity, valuation, concentration, fees) conceptually.
- Recognize how trading mechanics (premium/discount, secondary market liquidity) affect investor experience in these products.
- Identify suitability considerations for products with lockups, leverage, or complex structures (conceptual).
- Compare closed-end funds, ETFs, and mutual funds in structure and pricing conceptually.
- Recognize tax considerations at a high level for products with distributions (conceptual).
- Given a scenario, choose which managed product category best matches a client need (income, diversification, access).
- Given a scenario, identify the main risk disclosure point for a non-traditional managed product.
- Given a scenario, choose whether to use a conventional fund versus a specialized managed product based on constraints.
Chapter 23 - Structured Products
- Define structured products and describe why they are created (custom payoffs and risk packaging) conceptually.
- Describe principal-protected notes (PPNs) at a high level, including protection conditions and risks (conceptual).
- Describe market-linked guaranteed investment certificates (GICs) at a high level and how returns are linked to underlying markets.
- Explain split shares at a high level and how cash flows are allocated between preferred and capital shares conceptually.
- Describe asset-backed securities at a high level and key risks (credit and prepayment) conceptually.
- Identify common structured product risks: issuer credit risk, liquidity, complexity, and caps/participation rates (conceptual).
- Recognize the trade-off between protection features and upside participation in structured products (conceptual).
- Apply suitability thinking to a scenario to determine whether a structured product fits horizon, liquidity, and risk capacity.
- Identify key disclosure points for structured products (conditions, fees, issuer risk, liquidity).
- Recognize how structured products can be misunderstood when marketed as "safe" and why framing matters (conceptual).
- Given a scenario, choose the most important question to ask about a structured product (what is protected, by whom, and under what conditions).
- Compare a structured product to a conventional alternative (bond or fund) conceptually in risk and liquidity.
- Given a scenario, choose the correct interpretation of a payoff description (conceptual).
Canadian Taxation (6%)
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Chapter 24 - Canadian Taxation
- Describe the Canadian taxation system at a high level and why after-tax returns matter for investors.
- Differentiate capital gains, capital losses, and income at a conceptual level.
- Describe how capital gains and losses can affect taxable outcomes (conceptual).
- Identify tax deferral and tax-free plans at a high level and when they may be advantageous.
- Describe basic tax planning strategies used in investing (timing, deferral, account selection) conceptually.
- Recognize the difference between taxation concepts and changing tax rules/thresholds (conceptual caution).
- Identify how distributions from funds can have different tax character conceptually.
- Apply after-tax thinking to a scenario to choose between two investment options (conceptual).
- Identify the key tax information needed before making a recommendation (account type, income type, horizon) conceptually.
- Given a scenario, choose the tax planning action most consistent with the client constraint (tax sensitivity, horizon).
- Recognize that tax planning must be coordinated with risk and liquidity constraints (conceptual integration).
- Given a scenario, identify the biggest tax-related mistake (confusing return with distribution or ignoring account type).
Fee-Based Accounts and Working with the Retail Client (8%)
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Chapter 25 - Fee-Based Accounts
- Describe fee-based accounts and how they differ from commission-based arrangements conceptually.
- Identify key characteristics of fee-based accounts (transparent fees and service orientation) conceptually.
- Differentiate managed fee-based accounts from non-managed fee-based accounts (discretion, mandate, oversight) conceptually.
- Recognize how fee-based structures affect suitability discussions and documentation expectations (conceptual).
- Identify typical services bundled in fee-based relationships (planning, reporting, rebalancing) conceptually.
- Explain how fees affect net returns and why fee disclosure matters.
- Recognize conflict-of-interest considerations and how fee models can mitigate or create conflicts (conceptual).
- Apply a scenario to choose whether a fee-based account is appropriate given trading frequency and service needs.
- Identify what must be documented when establishing a fee-based relationship (mandate, IPS, client consent) conceptually.
- Recognize how performance reporting and benchmarking expectations can differ in fee-based relationships (conceptual).
- Compare fee-based and transaction-based costs for different client behaviours (conceptual).
- Given a scenario, choose the best disclosure statement about fees and services in a fee-based account.
- Given a scenario, choose the best next step when a fee-based account no longer fits the client situation (review, adjust, document).
Chapter 26 - Working with the Retail Client
- Apply the financial planning approach to a retail client scenario (gather facts, set goals, recommend, monitor).
- Identify how the life cycle hypothesis influences savings, borrowing, and portfolio risk decisions conceptually.
- Recognize how retail client objectives and constraints typically change across life stages (conceptual).
- Apply estate planning concepts at a high level in a retail client context (beneficiaries, wills, planning triggers) conceptually.
- Recognize ethical and standards-of-conduct expectations when working with retail clients (fair dealing, disclosure, suitability) conceptually.
- Identify common suitability pitfalls in retail advice (over-risking, liquidity mismatch, concentration).
- Choose how to translate client goals into an IPS-style set of constraints (conceptual).
- Recognize the role of behavioural coaching and communication in retail client outcomes (conceptual).
- Given a scenario, choose the best next action when a retail client situation changes (update KYC and adjust plan).
- Given a scenario, identify which retail constraint should dominate (horizon, liquidity, risk capacity, tax).
- Given a scenario, choose a recommendation that is operationally realistic and properly documented.
- Recognize when referral to specialists (tax/legal/insurance) is appropriate and how to document scope (conceptual).
- Given a scenario, choose the most ethical response when incentives conflict with client interests.
Working with the Institutional Client (10%)
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Chapter 27 - Working with the Institutional Client
- Differentiate the sell side and buy side of the market and the roles each plays in institutional trading.
- Identify responsibilities of a buy-side portfolio manager and trader at a high level.
- Describe the organizational structure of a sell-side trading firm and common functions (conceptual).
- Identify revenue sources for sell-side trading firms (spreads, commissions, financing) conceptually.
- Describe institutional clearing and settlement at a high level and why process controls matter.
- Recognize roles and responsibilities in the institutional market (trader, sales, research, compliance) conceptually.
- Identify how investment styles, guidelines, and restrictions shape institutional mandates.
- Apply a scenario to choose an execution approach consistent with institutional guidelines (conceptual).
- Recognize how algorithmic trading is used institutionally and the high-level rationale (execution quality and cost) conceptually.
- Identify risks in institutional trading contexts (market impact, information leakage, conflicts) conceptually.
- Given a scenario, identify whether the issue is mandate/guideline compliance, execution, or settlement.
- Given a scenario, choose the most appropriate documentation or escalation action for an institutional client workflow (conceptual).
Tip: CSC Exam 2 favors “best answer” reasoning. When multiple choices look plausible, pick the one that best matches the client’s constraints and is operationally realistic.