Sfc Electronic Trading Regulation Test

10 Questions | Total Attempts: 92

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Training Quizzes & Trivia

Thank you for attending the training online. To be entitled to certificate of completion, please take this assessment test. The test contains 10 questions that you will need to answer 5 questions correctly in order to be entitled to certificate of completion. There will only be 2 attempts of this assessment test and no refund will be made for any failure of the test and certificate of completion will not be issued. Let's take the test!


Questions and Answers
  • 1. 
    Direct Market Access (DMA) most likely refers to:
    • A. 

      The user having a fixed seat in the trading floor of the Stock Exchange of Hong Kong Limited (SEHK) and acting as an exchange participant

    • B. 

      The user having access to the market provided by a licensed / registered person through which the user can transmit orders, directly or indirectly, to the market’s trade matching system for execution

    • C. 

      The user using computerized programs and algorithms to place trade orders

  • 2. 
    Which of the following activity is least likely considered as electronic trading?
    • A. 

      Conducting computerized trades based on algorithmic programs

    • B. 

      Analysing stock performance on an electronic spreadsheet

    • C. 

      Placing an order through the internet trading system provided by a broker

  • 3. 
    Fund managers, who are users of third party electronic trading system, are least expected to:
    • A. 

      Ensure due diligence is performed on such system

    • B. 

      Perform annual assessment on the service provider of the trading system

    • C. 

      Provide technical courses on quantitative algorithm and programming to their employees

  • 4. 
    Under the SFC Code of Conduct, the ultimate responsibility of management and supervision of electronic trading system is most likely to lie with :
    • A. 

      At least one of the responsible / executive officers

    • B. 

      The IT department head

    • C. 

      The Lead Trader who aggregates a firm’s trades

  • 5. 
    To fulfil the record keeping requirement, provider of electronic trading system is required to maintain:
    • A. 

      Design, development, deployment and operation of the electronic trading system

    • B. 

      An error log summarizing all incidents in relation to the system

    • C. 

      Documents related to the annual review on the system

    • D. 

      All of the above.

  • 6. 
    Which of the following party is most likely to be a provider of electronic trading system?
    • A. 

      IT staff of a public fund house

    • B. 

      Private fund managers

    • C. 

      Brokerage firms

  • 7. 
    In terms of the management and supervision of electronic trading systems, which of the following is a recommended practice?
    • A. 

      Clearly identify the reporting lines in relation to the supervisory responsibilities

    • B. 

      Managerial and supervisory controls are in place to manage the risks associated with the use of the electronic trading system by itself or by its clients.

    • C. 

      Establish a formalized governance process

    • D. 

      All of the above

  • 8. 
    Which of the following is least likely considered as a suitable ​back up policy?
    • A. 

      Using an off-site server mirroring solution

    • B. 

      Setting up daily cloud back-up via a secured connection

    • C. 

      Copying company files as a back up to a personal flash drive on a monthly basis

  • 9. 
    As set out in Paragraph 18.5 in the SFC Code of Conduct, electronic trading system users should have a written contingency plan to cope with emergencies and disruptions, including a BCP. A “BCP” refers to:
    • A. 

      Bi-annual Critique Process

    • B. 

      Business Continuity Plan

    • C. 

      Basic Computer Programming

  • 10. 
    An adequate electronic trading system should:
    • A. 

      Have no pre-trade controls so that traders can capture all opportunities to generate profit

    • B. 

      Fix the capacity level with an expectation that 85% of clients would place orders

    • C. 

      Include techniques to protect the confidentiality and integrity of stored information

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