All RE5 questions
Financial Products Apply knowledge of the financial products and services environment
A client asks whether a foreign-currency-denominated investment is covered by FAIS. Which answer is correct?
RE5 practice question with a worked answer. This is one of hundreds of FSCA RE5 questions in the RegulatoryExams question bank.
- a) Such instruments can fall within the FAIS definition of financial products, so the usual advice and disclosure duties apply.Correct
- b) Foreign-currency investments are never financial products.
- c) FAIS only covers products priced in rand.
- d) Only the Reserve Bank, never an FSP, may discuss them.
Why this is the answer
Foreign-currency-denominated instruments (e.g. certain deposits) can fall within the FAIS definition of financial products, meaning the normal advice, suitability and disclosure duties apply. FAIS is not limited to rand-priced products.
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