MPF exam MPF Intermediaries question: insists on investing in an equity fund

MPF examMPF Intermediaries

A suitability assessment shows a client has a low risk profile, but she insists on investing in an equity fund. Which of the following should the intermediary do? (i) tell the client there is a risk mismatch between the fund and her risk profile (ii) document the mismatch, the explanations, her decision and reasons, and have her sign (iii) refuse to process her instruction until she picks a lower-risk fund (iv) confirm the choice is her own decision and ask for her reasons

A (i) and (iv) only
B (i), (ii) and (iii) only
C (i), (ii) and (iv) only
D (i), (ii), (iii) and (iv)

Show the answer and explanation

Answer: C. (i), (ii) and (iv) only

Answer: (i), (ii) and (iv) only. Statements (i), (ii) and (iv) are risk-mismatch steps; the Guidelines do not require refusal.(i) True. III.30(a).(ii) True. III.30(d)-(e), with a copy to the client under III.30(f).(iii) False. The client may proceed with her own choice once the mismatch steps are followed.(iv) True. III.30(c).Why not the others:• (i) and (iv) only: omits the true (ii).• (i), (ii) and (iii) only: includes the false (iii) and omits the true (iv).• (i), (ii), (iii) and (iv): includes the false (iii).Watch out: Assuming a mismatch means the intermediary must refuse the business.Rule: CG III.30: tell; explain risk and possible unsuitability; confirm own decision and reasons; document; sign; copy; keep 7 years.Source: MPFA Guidelines VI.2 on Conduct Requirements for Registered Intermediaries, Version 4 (effective 30 Apr 2026), para. III.30 (checked 31 Oct 2026)