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CFP® Practice Question: How Much Would you Pay for this Bond?
Bill asks you to price a zero-coupon bond that matures in seven years for $1,000. Bonds with similar risk and maturity yield 10.5%. What is a fair price for Bill to pay for this bond? $473 $481 $489 $497 CLICK TO REVEAL ANSWER The correct answer is C. TI BA-II Plus HP-12C 7, x,…
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CFP® Practice Question: Which Portfolio Would You Choose?
Portfolio X has a weighted beta coefficient of 1.5, and Portfolio Y has a weighted beta coefficient of .8. Both portfolios are expected to earn the same weighted-average expected return. With these assumptions, which of the following statements is correct? An investor should choose Portfolio X because of its higher beta. An investor should choose…
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Student Question of the Week: Series EE Bonds Interest
Student: Question from Matt F.Course: Fundamentals of Financial Planning Student Question: I have several clients that inquired about this recently – they have several Series EE bonds that are maturing or have matured. Do these bonds continue to pay interest after maturity? Is the interest the same amount if so? Thanks. Matt Instructor Response: Hey…
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Debut of the Certified Personal Retirement Specialist™ Professional Designation
We are excited to announce the Certified Personal Retirement Specialist™ designation. The Certified Personal Retirement Specialist™ (CPRS™) designation covers topics beyond the CFP Board Exam. In-depth education of retirement planning techniques and actionable examples for how to effectively communicate retirement complexities with clients is a key part of the designation. This comprehensive professional designation is…
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Student Question of the Week: 529 Nonqualified Withdrawal Penalty
Student Question from Andrew S.Course: Fundamentals of Financial Planning Student Question: Under “penalties and restrictions for nonqual WDs from 529 plans”, what exactly is “this additional tax” mentioned in the third paragraph? Is it talking about the penalty or the penalty and income tax? Thanks. Andrew Instructor Response: Hi Andrew! This is a key topic…
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Student Question of the Week: Interest Rate Sensitive Industries
Student Question from Grace R.Course: Investment Planning Student Question: Hi Dan! In the fundamental equity analysis discussion regarding sectors, it states that the Utilities sector is considered interest rate sensitive. Would you mind explaining how utilities are interest rate sensitive? Instructor Response: Hi Grace! Great to hear from you! And a very good question here.…
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CFP® Practice Question: Differences Between Preferred Stock and Long-Term Bonds
Which of the following statements correctly describe differences between preferred stock and long-term bonds? (1) Preferred stock is more risky for the investor than long-term bonds issued by the same company. (2) The market price of preferred stock fluctuates more than the market price of long-term bonds. (3) Long-term bonds usually have a longer maturity…
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Student Question of the Week: Maximum Bodily Injury Coverage
Student Question from Safiya J.Course: Insurance Planning Student Question: Hi Dan, I hope you are doing well! I have a question about Question #8 (SHOWN BELOW) – what does the $300,000 mean in the coverage amount? I thought that was the maximum bodily injury coverage, but I must not be understanding that because I’m not…
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Why Become a CFP® Certificant?
The Financial Planning profession is expected to grow dramatically in the near term according to a recent CFP Board newsletter. The Board expects the need for personal financial advisors to shoot up by some 41% in the near term and continue leading the average occupation growth through 2020. If you are currently practicing as a…
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