CMFAS RES 1A The Capital Markets Industry & Participants question: CMS licence

CMFAS RES 1AThe Capital Markets Industry & Participants

Which of the following are participants that must hold a CMS licence or be exempt from it to carry on their activity? (a) A broking firm dealing in securities for clients. (b) A fund manager managing a discretionary portfolio. (c) A retail investor trading her own shares. (d) A firm advising on corporate finance. Which of the following are CORRECT?

A (a), (b), (c) and (d)
B (a), (b) and (d) only
C (c) only
D (a) and (c) only

Show the answer and explanation

Answer: B. (a), (b) and (d) only

Dealing, fund management and corporate finance advice are regulated activities under the SFA Second Schedule. A person trading purely for her own account is not carrying on a business in a regulated activity.

Common mistake

Own-account trading is outside the licensing net.

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