Free SOFA-CFE Exam Braindumps
Certified Financial iner Questions 111–115 (page: 24)

Updated On: 10-Feb-2026

A futures contract is an agreement traded on an exchange or contract market to buy, sell, or effect cash settlement based on the performance of an underlying interest.

  1. True
  2. False

Answer(s): A



Which of the following is Correct?

  1. The insurance company transfers to the seller of a call option the opportunity for capital loss-if the stock rises by an amount exceeding the exercise price, plus the cost of the option (premium).
  2. The insurance company transfers to the buyer of a call option the opportunity for capital gain-if the stock rises by an amount exceeding the exercise price, plus the cost of the option (premium).
  3. The insurance company transfers to the seller of a call option the opportunity for capital loss-if the stock decreases by an amount exceeding the exercise price, plus the cost of the option (premium).
  4. The insurance company transfers to the buyer of a floor option the opportunity for option gain-if the stock rises by an amount exceeding the exercise price, plus the cost of the option (premium).

Answer(s): B



An option to sell a particular stock at a fixed price within a stated period of time is called:

  1. put
  2. call
  3. hedge
  4. Capital gain

Answer(s): A



An option to buy a particular stock at a fixed price within a stated period of time is known as:

  1. put
  2. call
  3. hedge
  4. Capital gain

Answer(s): B



Which taxes are not reported as part of investment income, but are instead reported as a component of surplus through unrealized gains and losses?

  1. Depreciated
  2. Deferred
  3. Limited
  4. Venture

Answer(s): B



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