Canadian Securities Course (CSC) Practice Exam

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Study for the Canadian Securities Course Exam with our comprehensive practice test. Explore flashcards and multiple-choice questions, each with detailed hints and explanations. Prepare for your CSC exam with confidence!

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What is a characteristic of a "Bought deal" in the realm of securities trading?

Involves multiple dealers collaborating on the purchase
Results in the company buying back its own shares
Occurs when multiple buyers purchase shares
One dealer buys the entire issue and acts as a principal

The correct answer is: One dealer buys the entire issue and acts as a principal

A "bought deal" in securities trading refers to a type of offering where one dealer, also known as the "underwriter," purchases the entire issue of securities directly from the company and then resells them to investors. This means that only one dealer is involved in the purchase and they act as a principal, taking on the risk of selling the shares to investors on their own. Options A, B, and C are incorrect because they involve the involvement of multiple dealers or buyers, which is not characteristic of a bought deal.