Canadian Securities Course (CSC) Practice Exam · Question
What is the primary role of a prime broker?
Prime brokers offer a comprehensive suite of services to institutional clients, including securities lending, leveraged trading, cash management, and operationa
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Question: What is the primary role of a prime broker?
Answer options:
- To provide investment advice to retail clients. ✅ To offer specialized services like securities lending and leveraged trading for institutional clients such as hedge funds.
- To manage the underwriting process for initial public offerings (IPOs).
- To administer mutual funds and calculate their Net Asset Value (NAV).
Correct answer: To offer specialized services like securities lending and leveraged trading for institutional clients such as hedge funds.
Explanation: Prime brokers offer a comprehensive suite of services to institutional clients, including securities lending, leveraged trading, cash management, and operational support, particularly for hedge funds.
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