CME-3 Broker-Dealer Qualification Certificate - Version 1 - Study Manual

Sep 26, 2026

Uploaded by Aditya

Study Material for Capital Market Examination-3 (CME-3) focused on the Broker-Dealer Qualification Certificate, Second Edition, Version 1.00, issued in Jan. 2018. The manual explains broker-dealer roles in securities trading and provides candidate guidance for exam preparation. It is organized into two sections: Operations of Securities Markets and Broker-Dealer Regulations, covering fourteen chapters from market operations, order types, and valuation to capital market law, authorized persons rules, market conduct, and anti-money laundering/counter-terrorist financing.

LanguageEnglish

CategoryExam

FormatPDF

Pages235

Reading Time9 h 52 min

AccessFree to download

PREFACE

Table of Content

Section 1: Operations Of Securities Markets

1 Understanding Securities Markets

2 Buying And Selling Of Securities

3 Understanding Market Behavior

4 Behavioral Finance

5 Securities Valuation

6 Stock Analysis

Study Material For Capital Market Examination-3 (CME-3) of Broker-Dealer Qualification Certificate Second Edition Version No. 1.00 Issued date: Jan. 2018 CME-3: Broker-Dealer Qualification Certificate This is an educational manual only and the Capital Market Authority (CMA) accepts no responsibility for any persons undertaking trading or investment in whatever form. While every effort has been made to ensure its accuracy, no responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this publication can be accepted by the publisher or authors. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise without the prior permission of the copyright owner. Warning: Any unauthorized act in relation to all or any part of the material in this publication may result in both civil claim for damages and criminal prosecution. A Learning Map which contains the full syllabus appears at the end of this manual. Please note that the examination is based upon the syllabus. 2 PREFACE The Broker-Dealer Module (CME-3) is one of the specialized modules in the CMA’s Certification Examination series. This module is specifically developed for those who are involved in trading of securities within an Authorized Person, especially those related to brokerage, dealership, advising investors and managing client portfolios. This study manual is developed to assist candidates to acquire the necessary knowledge regarding these functions and to prepare candidates to sit for the Broker-Dealer Module (CME-3) examination. This manual is divided into two sections and fourteen chapters, as follows: Section 1: Operations of Securities Markets Chapter 1: Understanding Securities Markets Chapter 2: Buying and Selling of Securities Chapter 3: Understanding Market Behavior Chapter 4: Behavioral Finance Chapter 5: Securities Valuation Chapter 6: Stock Analysis Chapter 7: Corporate Actions Section 2: Broker-Dealer Regulations Chapter 8: Capital Market Law Chapter 9: Securities Business Regulations Chapter 10: Authorized Persons Regulations: Authorization Process Chapter 11: Authorized Persons Regulations: Conduct of Business Chapter 12: Authorized Persons Regulations: Systems and Controls Requirements Chapter 13: Market Conduct Regulations Chapter 14: Anti-Money Laundering/Counter-Terrorist Financing Rules It should be noted that Section 2 of this study manual is meant to provide focused explanations to the Capital Market Law and its Implementing Regulations, relevant to the broker-dealer and related functions. Candidates are advised to refer to the original legislations for complete rules and regulations governing authorized persons’ activities. 3 Table of Content Section 1 : Operations Of Securities Markets 1 Understanding Securities Markets Introduction 1.1 Investment 1.1.1 What Is Investment? 1.1.2 Individual Versus Institutional Investors 1.2 Securities Market And Stock Exchange 1.2.1 The Primary Market 1.2.2 The Secondary Market 1.2.3 The Role Of Stock Exchange 1.3 Types Of Securities 1.3.1 Money Market Securities 1.3.2 Equities 1.3.3 Bonds 1.3.4 Sukuk 1.3.5 Derivative Securities 1.4 The Investment Process 1.4.1 Elements Of The Investment Process 1.4.2 Concepts Of Investment Returns 1.4.3 Investment Returns Calculation 2 Buying And Selling Of Securities Introduction 2.1 Types Of Orders 2.1.1 Market Order 2.1.2 Stop Order 2.1.3 Limit Order 2.1.4 Stop Limit Order 2.1.5 Time-In-Force Designation For Orders 4 2.2 Stock Trading 2.2.1 Trade Execution 2.2.2 Order Matching Principle 2.2.3 Understanding Stock Quotations 2.3 Short-Selling 2.3.1 What Is Short-Selling? 2.3.2 Why Short-Selling? 2.3.3 Short-Selling Example 2.3.4 The Risk Of Short-

FAQs

What is the CME-3 Broker-Dealer module designed for?

It is developed for candidates involved in trading securities within an Authorized Person, especially brokerage, dealership, advising investors, and managing client portfolios. The study manual helps candidates acquire required knowledge to sit for the CME-3 examination.

How is the study manual structured?

It is divided into two sections and fourteen chapters. Section 1 covers operations of securities markets, while Section 2 covers broker-dealer regulations.

What regulations are emphasized in the broker-dealer regulations section?

Section 2 focuses on Capital Market Law and implementing regulations, authorized persons authorization and conduct requirements, market conduct regulations, and anti-money laundering/counter-terrorist financing rules.

Sep 26, 2026

Uploaded by Aditya