NISM Series XIII - TheMFCentral

NISM Series XIII: Common Derivatives Certification

Mock Tests

If you’re planning to appear for the NISM Series XIII: Common Derivatives Certification Exam, you’re already on the path to deepening your understanding of India’s derivatives market—a key segment of the financial industry. This exam is not just a regulatory requirement for certain market roles; it’s also a crucial step for anyone looking to build serious expertise in equity and currency derivatives trading.

Whether you’re a student of finance, a working professional in capital markets, or an aspiring trader, preparing thoroughly for this certification can make a real difference. And the best part? You don’t have to do it alone or rely solely on heavy textbooks. With the right strategy and tools, you can streamline your preparation and walk into the exam room with confidence.

Why the NISM Series XIII Certification Matters

The NISM (National Institute of Securities Markets) Series XIII certification focuses on equity and currency derivatives—two instruments widely used for hedging, speculation, and arbitrage in India’s capital markets. The certification is mandatory for professionals working with members of stock exchanges dealing in derivatives segments, especially if they’re involved in trading, clearing, or settlement.

Passing this exam not only ensures regulatory compliance but also enhances your employability in stock broking firms, investment advisory services, trading desks, and financial institutions.

The syllabus includes a variety of critical topics:

Basics of derivatives
Trading strategies using futures and options
Clearing, settlement, and risk management
Legal and regulatory framework

It’s a comprehensive course that requires not just understanding the theory but also applying it in real-world scenarios. That’s where mock tests can help tremendously.

Take Your Prep to the Next Level with Our FREE Mock Test

To support your exam journey, we’re offering a FREE, high-quality Mock Test crafted specifically for the NISM Series XIII exam. Here’s what makes it a valuable addition to your preparation toolkit:

Real Exam-Like Questions

The mock test includes questions modeled on the actual exam pattern and difficulty level. It covers a balanced mix of theory, calculations, and application-based problems, allowing you to get familiar with the kind of questions you’ll face.

Instant Results with Detailed Explanations

Once you complete the test, you’ll receive instant feedback on your score. Each question comes with a detailed explanation, so you’ll not only know whether you got it right or wrong—but why. This feature helps reinforce concepts and clear up common mistakes.

100% Free – No Registration Required

We believe that quality exam prep should be accessible to everyone. That’s why this mock test is completely free—no registration, no payment, no email signup. Just click, take the test, and start learning.

Who Should Take This Test?

Our free mock test is ideal for:

Finance students are preparing for internships or placements in trading, investment analysis, or risk management.

Market professionals need to pass the NISM exam as a compliance requirement.

Aspiring traders who want to gain practical knowledge of derivatives before entering the market.

Even if you’re just curious about how derivatives work in India’s financial system, this mock test can serve as a great self-assessment tool.

How to Maximize the Benefit of This Mock Test

Simulate real exam conditions: Time yourself while taking the test to practice completing it within the 2-hour window.
Review every explanation: Even if you answered correctly, read the explanation to reinforce your understanding.
Retake as needed: Use the test as a progress tracker by taking it again after additional study sessions.

Ready to Test Your Knowledge?

If you’re serious about clearing the NISM Series XIII exam on your first try, don’t miss this opportunity to practice with realistic, high-quality questions.

This mock test will help you familiarize yourself with the exam format, assess your knowledge, and identify areas that may need further study.

NISM Series XIII Mock Test

Here are 150 sample MCQs to help you prepare for the NISM Series XIII: Common Derivatives Certification Examination.

1 / 150

A call option gives the buyer the right to buy the underlying at market price

A. True

B. False

2 / 150

2. The relationship between bond price and yield to maturity is _______.

A. Linear

B. Convex

C. Inverse

D. Hyperbola

3 / 150

3. Margin money in futures contracts is meant to:

A. Increase profits

B. Cover broker commissions

C. Protect against default

D. Determine the trade volume

4 / 150

4. Which of the following qualifies as Liquid Assets for margin?

A. Equity shares (100%)

B. Government securities

C. Promoter holdings

D. Unlisted debentures

5 / 150

5. Find out the Intrinsic value of a CALL option of ABC. Spot is Rs 2000. Strike is Rs 2020.

A. -20

B. 20

C. 0

D. None of the above

6 / 150

When a client defaults in making payments in respect of a daily settlement, the contract is closed out. The amount not paid by the client is adjusted against the ___

Bank fixed deposits of the client

Shares deposited by client with the trading member

Initial margin paid by client

PPF balance of the client

7 / 150

The lot size for EURINR futures contract is

A. 10,000 EUR

B. 10,000 INR

C. 1,000 INR

D. 1,000 EUR

8 / 150

8. Which of the following is true about put options?

A. They provide the right to buy

B. They provide the right to sell

C. They are obligations to buy

D. They are traded OTC only

9 / 150

9. A person has invested INR 100,000 in an Indian corporate bond for a year giving a
return of 16% in one year. The person plans to use the proceeds from the maturity of
corporate bond to fund his son's education on US. At the time of investing in the
corporate bond, USDINR spot rate was 70 and one year premium was 4%. The person
decides to hedge currency risk using USDINR one year futures. At the end of one year,
how many USD can this person remit to his son.

A. 1320

B. 1417

C.1083

D. 1593

10 / 150

10. Which of the following instruments is used for hedging index exposure?

A. Equity options

B. Index futures

C. Currency futures

D. Treasury bills

11 / 150

11.

The market value of one contract is 2,000 times the quoted price and the market price is 106.10, the face value of 200,000. Compute the market value.

A. 2,72,300

B. 2,43,500

C. 2.12,200

D. 2,82,500

12 / 150

12. Which of the following is the last trading day for cash settled 10-year bond futures?

A. Two business days after the first business day of the Expiry Month

B. Two business days before the last business day of the Expiry Month

C. Seven business days before the last business day of the Expiry Month

D. Last Thursday of Contract Month

13 / 150

13. A Buy or a Sell order(s) which is/ are lying unmatched in the order book are known as
________________.

A.Active Orders

B. Passive Orders

C. Best Orders

D. None of the above

14 / 150

14. Which of the following is a non-deliverable forward (NDF)?

USD/INR exchanged physically

Only P&L settled in INR

Futures on USD/INR

Exchange traded currency option

15 / 150

15. The yield to maturity amortizes the capital gain or loss at redemption over the bond's life and adds it to the _______.

A. Coupon

B. Bond Price

C. Both 1 & 2

D. Current Yield

16 / 150

16. Margins in 'Futures' trading are to be paid by _______.

A. Only the buyer

B. Only the seller

C. Both the buyer and the seller

D. The clearing corporation

17 / 150

17. The purpose of interest rate swaps is to:

A. Exchange currencies

B. Exchange fixed and floating interest payments

C. Pay option premium

D. Trade spot interest

18 / 150

18. Option buyer faces ________ risk and option seller faces __________ risk.

A, Limited, Unlimited

B. Limited, Limited

C. Unlimited, Limited

D. Unlimited, Unlimited

19 / 150

19. Which of these is true about a European Option?

A. Can be exercised any time

B. Can be exercised only on expiry

C. Settled in USD

D. Has no expiry

20 / 150

20.

Margins across the various clients of a member are collected on a gross basis

A. True

B. False

21 / 150

21. Which of these best defines basis in futures trading?

A. Spot price – Futures price

B. Futures price + Premium

C. Spot price + Margin

D. Strike price – Premium

22 / 150

22. Gaurav Buys USD-INR 16 contracts (1 lot= USD 1000) at Rs. 49.25 per unit. If tick size is Re.0025 how much he will gain or lose if there is upward movement of 10 ticks?

A. Rs.60 gain

B. Rs. 400 loss

C. Rs. 400 gain

D. Rs. 600 loss

23 / 150

23. RBI guideline on Rupee Interest Rate Derivatives (Reserve Bank) Directions, 2019 permit _______________ to participate in interest rate derivatives contract.

A. Non-Residents

B. Non-Retail

C. Retail

D. All of the above

24 / 150

24. A calendar spread contract in index futures attracts ___________.

A calendar spread contract in index futures attracts ___________.

B. No margin need to be paid for calendar spread positions

C. Same margin as sum of two independent legs of futures contract

D. Lower margin than sum of two independent legs of futures contract

25 / 150

25. On the derivative exchanges, all the orders entered on the Trading System are at prices exclusive of brokerage.

A. True

B. False

26 / 150

26.

Limitation of Interest Rate Derivatives for Hedgers is mainly due to ____

A. Standardised Contract

B. Non availability on all kind of underlying instruments

C. Both of the above

D. None of the above

27 / 150

27.

An importer takes a long position in USDINR futures contract at a price of 53 by buying 20 lots. At the expiry, the settlement price is 54.3. how much profit or loss did the importer make?

A. Profit of 2600

B. Profit of 26000

C. Loss of 2600

D. Loss of 26000

28 / 150

28.

A company expects to receive USD 100,000 in 2 months. Current USDINR is 83.40. To hedge, it sells USD futures at 83.60. If INR appreciates to 83.00 at expiry, what is the profit?

A. 60,000

B. 40,000

C. 83,000

D. 1,00,000

29 / 150

29. Which act empowers SEBI to regulate securities markets?

A. Companies Act

B. RBI Act

C. SEBI Act, 1992

D. FEMA

30 / 150

30.

Guidance Notes on Accounting for Derivatives Contract recognise following type of hedging for hedge accounting: ____________.

A. Fair Value hedge accounting model

B. The cash flow hedge accounting model

C. The hedge of a net investment in a foreign operation

D. All of the above

31 / 150

31. In an interest rate swap, the floating leg is typically tied to:

Repo rate

LIBOR/IBOR

Call money rate

Equity index

32 / 150

32. Initial margin requirements shall be based on 99% _________ over a one day time horizon.

A. Systematic Risk

B. Value at risk (VaR)

C. Financial Risk

D. Market Risk

33 / 150

33. The minimum net worth required for a Clearing Member is:

A. ₹1 crore

B. ₹3 crores

C. ₹50 lakhs

D. ₹5 crores

34 / 150

34. _______ is the price that is used to compute the price range for the opening trade on any trading day.

A. Base price

B. Cap price

C. Limit price

D. Trigger price

35 / 150

35.

Execution of Power of attorney by the client in favor of stockbroker is _____

A. Mandatory at the time of placing an order

B. Mandatory at the time of KYC

C. Optional

36 / 150

36. Which of the following derivatives have the largest market size globally?

A. Equity derivatives

B. Interest rate derivatives

C. Currency derivatives

D. Commodity derivatives

37 / 150

37. Total number of derivatives contracts outstanding is called __________

A. Long position

B. Short position

C. Open interest

D. None of the above

38 / 150

38. SEBI was established under which year’s Act?

A. 1992

B. 1995

C. 1985

D. 2000

39 / 150

39.

A defaulting member's clients’ positions could be transferred to ____________ by the Clearing Corporation.

A. Another solvent member

B. The Exchange

C. A suspense account

D. Error account

40 / 150

40. Nifty and Sensex originally followed which methodology?

A. Equal weighted

B. Free-float

C. Price weighted

D. Market capitalization weighted

41 / 150

41. A Trading Member has two Clients: Client A and Client B. Client A has net Long Position of 12 and Client B has net Short Position of 10. What is the net position for the Trading Member?

A. Long 2

B. Long 12

C. Short 10

D. Long 12 and Short 10

42 / 150

42. A company, which is due to receive a payment in a foreign currency on a future date, enters into a forward transaction with a bank agreeing to sell the foreign currency and receive a predetermined quantity of domestic currency. This is an example of Hedging.

A. TRUE

B. FALSE

43 / 150

43. Which of the following is NOT an example of a derivative?

A. Futures

B. Options

C. Equity Shares

D. Forward Contracts

44 / 150

44.

For the open positions on last trading day, the seller must notify the Clearing Corporation his intention to deliver by the close of ____

A. Last trading day

B. Two business days prior to the last business day (expiry day) of the contract month

C. Both a and b are same

D. None of the above

45 / 150

45. What is “Impact cost” in the context of an index?

A. Cost of index calculation

B. Cost of listing on an exchange

C. Price movement due to large orders

D. Brokerage charges

46 / 150

46. You are the owner of a 15 million portfolio with a beta 1.0. You would like to insure your portfolio against a fall in the index of magnitude higher than 10%. Spot Nifty stands at 9000. Put options on the Nifty are available at three strike prices. Which strike will give you the insurance you want?

A. 9900

B. 8900

C. 8100

D. None of the above

47 / 150

47. A penalty or suspension of registration of a stock broker from derivatives exchange/segment under the SEBI (Stock Broker) Regulations, 1992 can take place if _______________.

A penalty or suspension of registration of a stock broker from derivatives exchange/segment under the SEBI (Stock Broker) Regulations, 1992 can take place if _______________.

B. The stock broker fails to pay fees

C. The stock broker is suspended by the stock exchange

D. In any of the above situations

48 / 150

48. A speculator's aim in derivatives is to:

A. Reduce exposure

B. Eliminate position

C. Profit from price changes

D. Deliver stocks

49 / 150

49. Which one of the following statements is FALSE?

A. Option writers receive premium

B. Buyers have limited loss

C. Options can expire worthless

D. Call options force buyers to purchase

50 / 150

50. A trader shorted a future at ₹1,000. Price rose to ₹1,050. The loss is:

A. ₹50

B. ₹100

C. ₹1,000

D. ₹0

51 / 150

51.

Insurance companies are allowed to participate in interest rate futures only for _____.

A. Long Hedge

B. Short Hedge

C. Both A and B

D. None of the above

52 / 150

52. Bearish Vertical Spreads can be implemented by the use of _________.

A. Only Puts

B. Only Calls

C. Both Calls and Puts

D. None of the above

53 / 150

53. The futures hedge is simultaneously exposed to both basis risk and yield curve spread risk.

A. True

D. False

54 / 150

54. What is the settlement method for 91-day bill futures?

A. Cash

B. Physical

C. Can be cash or physical

D. None of the above

55 / 150

55. Which one is true about SEBI’s regulation on derivatives?

A. Only mutual funds can use it

B. Only banks can use it

C. Retail investors are banned

D. Retail investors can participate

56 / 150

56. If implied volatility increases, which of the following increases in value?

Option premium

Bond yield

NAV of debt funds

Repo rate

57 / 150

57. Which of the following has higher credit risk?

A. Bond rated AAA

B. Bond rated A

C. Bond rated BBB

D. All of them have same credit risk

58 / 150

58.

All the 50 stocks of NSE NIFTY index are equally weighted while calculating the index.

A. True

B. False

59 / 150

59. ______ specifies how to convert the payment period into year fraction.

A. Year count fraction

B. Month count basis

C. Day count fraction

D. Period count basis

60 / 150

60.

Assume that on 1st December 2020, USD-INR spot was at 45, premium for January 2021 maturity put option at strike of 45.5 is INR 0.54/0.55 and premium for January 2021 maturity call option at strike of 45 is INR 0.71/0.72. A client executes a trade wherein he buys put at a strike of 45.5 and sells a call at a strike of 45. On expiry the RBI reference rate is 44.75. How much net profit/loss did the client make per USD?

A. Loss of INR 0.2

B. Profit of INR 0.15

C. Profit of INR 0.91

D. Loss of INR 0.96

61 / 150

61. What should the affected stock exchange do to restore normalcy of operations during an outage?

A. Activate its Disaster Recovery Site and inform SEBI within 30 minutes.

B. Extend trading hours indefinitely until normalcy is restored.

C. Resume trading in unaffected market segments and other stock exchanges.

D. Completely suspend trading until the issue is resolved.

62 / 150

62. In case of Clearing Member default, which funds are used first?

A. Client margins

B. Exchange fund

C. Member’s own margin

D. Settlement Guarantee Fund

63 / 150

63. The price which option buyer pays to option seller to acquire the right is called as ___________.

A. Market price

B. Future price

C. Option price

D. Spot price

64 / 150

64. Interoperability of clearing corporation framework is allowed for all the products available in the Indian securities markets, EXCEPT: __________.

A. Commodity Derivatives

B. Interest rate derivatives

C. Index Derivatives

D. Index Options

65 / 150

65. The ___________ has a strong international presence and second-largest and second-most traded currency in the international markets.

A. Euro (EUR)

B. Japanese Yen (JPY)

C. U.S. dollar (USD)

D. Swiss Franc (CHF)

66 / 150

66. The computation of turnover is a very important factor as the applicability of _________ is determined on the basis of turnover.

A. Internal audit

B. External audit

C. Bank audit

D. Tax audit

67 / 150

67. If an Option has a high Gamma, what can be said about Option’s Delta?

A. Delta changes rapidly with small changes in the underlying asset's price.

B. Delta is stable & changes slowly

C. Delta is close to zero

D. Delta is unaffected by the underlying assets price chages

68 / 150

68.

If the annual interest rate is 5% and the dividend yield on a stock is 2%, what is the six-month futures price of a stock currently trading at Rs 500 in the spot market?

Rs 507.50

Rs 512.50

Rs 505

None of the above

69 / 150

69. A penalty or suspension of registration of a stock broker from derivatives exchange/segment under the SEBI (Stock Broker) Regulations, 1992 can take place if _______________.

A. The stock broker violates the conditions of registration

B. The stock broker fails to pay fees

C. The stock broker is suspended by the stock exchange

D. In any of the above situations

70 / 150

70. For equity derivatives, carrying cost is the interest paid to finance the purchase less (minus) dividend earned.

A. True

B. False

71 / 150

71. A Buy or a Sell order(s) which is/are lying unmatched in the order book are known as ________________.

A. Active Orders

B. Passive Orders

C. Best Orders

D. None of the above

72 / 150

72.

You expect GBP/USD to rise from 1.63 to 1.68. How should you trade GBP/INR & USD/INR futures?

A. Short GBP/INR & Long USD/INR

B. Long GBP/INR & Short INR/USD

C. Short GBP/INR & Long INR/USD

D. Long GBP/INR & Short USD/INR

73 / 150

73. When the index future is used to hedge against the market risk on a portfolio, then it can be called as a cross hedge.

A. TRUE

B. FALSE

74 / 150

74.

Person goes short in a GBPINR futures contract at Rs.99.75 and on expiry GBPINR reference rate is Rs. 100.75, he will ________?

A. Make profit of Rs. 1

B. Make loss of Rs. 1

C. No profit no loss

D. None of the above

75 / 150

75. Which of the following is true?

A. Base currency is the first currency in a currency pair

B. Base currency is the second currency in a currency pair

C. Quotation currency is the first currency in a currency pair

D. Exchange rates are quoted in per unit of quotation currency

76 / 150

76. When the forex strike rate increases, the put option premium _______.

A. Increases

B. Decreases

C. No Change

D. None of the above

77 / 150

77. A put option becomes profitable when:

A. Spot price increases

B. Spot price decreases

C. Time value increases

D. Strike price increases

78 / 150

78. What is the settlement method for USDINR futures?

A. Cash

B. Physical / Based on Delivery

C. Can be cash or physical

D. None of the above

79 / 150

79. Clearing members are responsible for:

A. Creating new derivatives

B. Reporting insider trades

C. Risk management and settlement

D. Conducting auctions

80 / 150

80. Which of these is NOT a characteristic of a forward contract?

A. Customizable

B. Traded on exchange

C. OTC traded

D. High counterparty risk

81 / 150

81. Consider a scenario in which USDINR was quoting as 63.40/63.42 and EURUSD as 1.1450 / 1.1453 in the morning and by the day end USDINR moves to 63.10/63.12 while EURUSD moves to 1.1420/1.1422. What would best describe the movement of currency during the day ?

A. USD has appreciated against INR and also appreciated against EUR

B. USD has depreciated against INR and also depreciated against EUR

C. USD has appreciated against INR and depreciated against EUR

D. USD has depreciated against INR and appreciated against EUR

82 / 150

82. The current yield cannot be considered as true return because it does not consider the ________.

A. Reinvestment rate of periodic cash flows

B. Capital gain or loss

C. Both 1 & 2

D. Premium or discount in bond price

83 / 150

83.

A naked position involves holding an equivalent position in the underlying asset

A. True

B. False

84 / 150

84. Maximum loss for a short straddle is:

A. Unlimited

B. Premium received

C. Strike price

D. Spot price

85 / 150

85.

What is the net payoff for Ms. Sakshi, who purchased a Rs 21.50 strike call option for Rs 0.20, if the underlying bond price closes at Rs 21.70 on the expiry date?

A. 0.20

B. 0.40

C. -0.20

D. 0

86 / 150

86.

Regulations on buying and selling of T bills and T bond futures for NRIs and FII investors?

A. Can short sell freely

B. Can short sell with permission of SEBI

C. Cannot short sell

D. None of the above

87 / 150

87. Market risk or systematic risk can be reduced by using index derivatives.

A. TRUE

B. FALSE

88 / 150

88.

A trader feels that INR should depreciate against USD in next few months. What currency futures trade will be profitable to him if his views comes correct?

A. Buy USDINR

B. Sell USDINR

C. Buy USDEUR

D. Sell USDEUR

89 / 150

89. The margins shall be collected /adjusted from the _________ assets of the member on a real time basis.

A. Liquid assets

B. Fixed assets

C. Current assets

D. Operating assets

90 / 150

90.

How are proprietary positions calculated for a Trading Member?

A. On a gross basis (buy + sell)

B. On a net basis (buy-sell)

C. By averaging the buy and sell quantities

D. By considering only the buy quantities

91 / 150

91.

Assume that the one-year interest rate is 1% in US, 2% in UK and 7% in India. If current GBPINR spot rate is 91.60, what would be the one-year future rate of GBPINR?

A. Higher than 91.60

B. Lower than 91.60

C. Equal to 91.60

D. Cannot be determined with the above data

92 / 150

92. The ____________ model was developed by William Sharpe in 1978.

A. Binomial option pricing model

B. Black & Scholes Model

C. Jump process pricing model

D. Monte-carlo simulation

93 / 150

93. The investor has the right to demand prepayment on specified dates before maturity in case of _______.

A. Puttable Bonds

B. Callable Bonds

C. Convertible Bonds

D. Both 1 & 2

94 / 150

94. Assume you are an exporter, and you want to sell USD that you have received as
export remittance. The bank quotes a price of 75.10 / 75.12 for USDINR. At what price
can you sell one unit of USD?

A. 75.12

B. 75.11

C. 75.09

D. 75.10

95 / 150

95.

You sold one XYZ Stock Futures contract at Rs. 278 and the lot size is 1,200. What is your profit (+) or loss (-), if you purchase the contract back at Rs. 265?

A. 16,600

B. 15,600

C. -15,600

D. -16,600

96 / 150

96. An option is _________, if on exercising it, the option buyer gets positive cash flow.

A.In the money

B. At the money

C. Out of the money

D. None of the above

97 / 150

97. Following derivatives contracts are traded only on Exchanges?

A.Currency Options

B. Currency Swaps

C. Currency Futures

D. FX Swaps

98 / 150

98. Order lying unmatched in the system is called _____________.

A. Market orders

B. Idle Orders

C. Active orders

D. Passive orders

99 / 150

99. Which Greek indicates the impact of time decay on an option?

A. Vega

B. Rho

C. Theta

D. Gamma

100 / 150

100.

Identify the contract which is cleared and settled bilaterally

A. A one-month Nifty futures contract

B. A month USDINR options contract

C. a 3-month forward contract to buy Swiss Francs against INR

D. a one-month GOI bond futures contract

101 / 150

101. SEBI-registered brokers can introduce DMA facility to their clients after obtaining permission from respective ____________.

A. Stock Exchanges

B. Derivative Market

C. Clearing corporation

D. Securities Market

102 / 150

102. A person has invested USD 100,000 in US equities with a view of appreciation of US stock market. In next one year, his investments in US equities appreciated in value to USD120,000. The investor decided to sell off his portfolio and repatriate the capital and profits to India. At the time of investing abroad the exchange rate was 44.5 and at the time of converting USD back into INR, he received an exchange rate of 46. How much is the return on investment in USD and in INR respectively?

A. 20%, 16%

B. 20%, 24%

C. 20%, 20%

D. 20%, 18%

103 / 150

103.

If 1 year interest rate is 2% in USA and 10% in India, and USDINR is at 44, what is the expected 6 month future rate?

45.74

46.80

47.52

44.90

104 / 150

104. State whether TRUE or FALSE: Impact cost is low when the liquidity in the system is poor.

A. True

B. False

105 / 150

105. Which category of market participants seeks to reduce risk exposure?

A. Speculators

B. Arbitrageurs

C. Hedgers

D. Brokers

106 / 150

106.

___ is the process of computing open positions and determining mark to market margins

A. Clearing

B. Settlement

C. Pay in

D. Pay out

107 / 150

107.

Hedging for multiple bonds in a portfolio can be done by using _____

Year to maturity ratio

Market value ratio

Duration based hedge ratio

None of the above

108 / 150

108. Credit spread is the price of ___________.

A. Credit risk

B. Reinvestment risk

C. Price risk

D. All of the above

109 / 150

109. Securities Transaction Tax (STT) in case of Sale of an option in securities is payable by_______.

A. Buyer of the option Contracts

B. Seller of the option contract

C. Both of the above

110 / 150

110.

A ________ order is classified as price related condition.

A. Market

B. Day

C. IOC

D. None of the above

111 / 150

111. An institution buys a put option on 10Y G-Sec at strike 98. If price falls to 96, what is the intrinsic value?

A. 2

B. –2

C. 0

D. 98

112 / 150

112. The interest rate on ______ is the benchmark for determining the interest rate on other debt instruments.

A. Certificate of Deposit

B. Commercial Paper

C. Treasury Bills

D. Corporate Bonds

113 / 150

113.

Insurance companies are allowed to participate in interest rate futures only for _____.

A. Long Hedge

B. Short Hedge

C. Both A and B

D. None of the above

114 / 150

114. Which is the most active currency pair in the world?

A. EURUSD

B. USDJPY

C. USD/CAD

D. None of the Above

115 / 150

115.

At 11 am RBI announced the credit policy and a deduction in interest rates. Generally such a step will lead to ______ of rupees

A. Stengthening

B. Weakening

C. No effect

116 / 150

116. Which user is at the lowest level in the heirarchy of trading firm?

A. Branch Manager

B. Corporate Manager

C. Regional Manager

D. Dealer

117 / 150

117. Traditionally, the _______ serves the function of production-consumption in international trade.

A. Forex Market

B. Debt market

C. Fixed income market

D. Derivatives market

118 / 150

118. If participant buy 10 lot of single bond futures at Rs. 99, then contract value _________.

A. Rs. 20,00,000

B. Rs. 19,99,000

C. Rs. 19,80,000

D. None of the above

119 / 150

119. A trader sells a future and buys the same stock. He is:

A. Hedging

B. Speculating

C. Arbitraging

D. Diversifying

120 / 150

120. Government securities & T-Bills can be considered as _________ of collateral deposits given to clearing corporation by its members.

A. Cash Component

B. Non Cash Component

C. Equity Component

D. None of the above

121 / 150

121. The most traded currency pair is:

A. USD/INR

B. EUR/INR

C. EUR/USD

D. GBP/USD

122 / 150

122. If a member has payable obligation towards pay-in as well as margins, then ________.

A. He will not be able to place his orders the next day morning

B. He will not be able to login to the terminal

C. Both of the above

D. None of the above

123 / 150

123.

A Professional Clearing Member of derivatives segment _______

A. should also be a member of cash segment

B. should also become a member of the cash segment within 2 years

C. provides trading facility to its clients

D. does not have any trading rights

124 / 150

124.

Consider a scenario in which USDINR was quoting as 63.40/63.42 and EURUSD as 1.1450/1.1453 in the morning and by the day end USDINR moves to 63.10/63.12 while EURUSD moves to 1.1420/1.1422. What would best describe the movement of currency during the day?

A. USD has appreciated against INR and also appreciated against EUR

B. USD has depreciated against INR and also depreciated against EUR

C. USD has appreciated against INR and depreciated against EUR

D. USD has depreciated against INR and appreciated against EUR

125 / 150

125. In India, index derivatives are available on:

A. BSE only

B. NSE only

C. Both NSE & BSE

D. RBI

126 / 150

126. What best describes a derivative?

Variable interest security

Contract based on underlying

Mutual fund hedge

Regulated debt instrument

127 / 150

127. Usually, income from Exchange traded derivatives is treated as _________.

A. Business income

B. Income from other sources

C. Salary income

D. None of the above

128 / 150

128.

Daily Mark to market settlement of Exchange traded interest rate future contract is __________.

A. Cash settled

B. Adjusted to liquid asset

C. Both (A) & (B) above

D. None of the above

129 / 150

129. If an option is exercised, the STT is applicable on:

A. Strike price

B. Settlement price

C. Notional value

D. Spot price

130 / 150

130. Unsystematic risk can be reduced by portfolio diversification.

A. TRUE

B. FALSE

131 / 150

131. Operational risks include losses due to ____________.

A. Inadequate disaster planning

B. Too much of management control

C. Income tax regulations

D. Government policies

132 / 150

132. Interoperability of clearing corporation framework is allowed all the products
available in the Indian securities markets, EXCEPT:

A. Commodity Derivatives

B. Interest rate derivatives

C. Currency Derivatives

D. Cash Market

133 / 150

133. Derivative transactions before FY 2005–06 were considered:

A. Capital Gains

B. Business Income

C. Speculative

D. Exempt

134 / 150

134. The counterparty risk in exchange-traded derivatives is borne by:

A. The buyer

B. The seller

C. The exchange

D. The broker

135 / 150

135. Usually, income from Exchange traded derivatives is treated as _________.

A. Business income

B. Income from other sources

C. Professional income

D. None of the above

136 / 150

136. As a trader you believe EURUSD will move from 1.58 to 1.44 in next 2 months. Which of the following would you do to execute this view using currency futures contract of EURINR and USDINR?

A. Long EURINR

B. Short EURINR & Long USDINR

C. Long EURINR & Short USDINR

D. Short USDINR

137 / 150

137. Convenience return for a commodity is likely to be different for different people, depending on the way they use it.

A. TRUE

B. FALSE

138 / 150

138. A covered call strategy involves:

A. Selling Call and holding the underlying

B. Buying a Put

C. Buying a Call

D. None of the above

139 / 150

139. The _______ deviation is calculated using the Exponential Weighted Moving Average (EWMA).

A. Average deviation

B. Median absolute deviation

C. Standard deviation

D. Mean deviation

140 / 150

140. Which organization guarantees financial settlement in derivatives?

A. SEBI

B. Clearing Corporation

C. NSE

D. RBI

141 / 150

141.

Which of the following segments of market participants are allowed to trade in currency futures?

A. Individual

B. NRIs

C. Corporates

D. All of the above

142 / 150

142. Position limit for EURUSD at trading member level is?

Higher of 15% of the total open interest or EUR 100 million

Lower of 15% of the total open interest or EUR 100 million

Higher of 6% of the total open interest or EUR 10 million

Higher of 15% of the total open interest or EUR 50 million

143 / 150

143.

Rahul owns five hundred shares of ABC Ltd. Around budget time, he gets uncomfortable with the price movements. Which of the following will give him the hedge he desires (assuming that one ABC futures contract = 100 shares) ?

A. Buy 5 ABC Ltd. futures contracts

B. Sell 5 ABC Ltd. futures contracts

C. Sell 10 ABC Ltd. futures contracts

D. Buy 10 ABC Ltd. futures contracts

144 / 150

144. __________ net worth shall be computed as liquid assets less initial margin and extreme loss margin payable at any point in time.

A. Tangible Net worth

B. Liquid Net worth

C. Positive net worth

D. Negative net worth

145 / 150

145. The initial margin amount is large enough to cover a one day loss that can be encountered on ________ of the days.

A. 90%

B. 95%

C. 99%

D. 50%

146 / 150

146. In India, currency futures are regulated by:

A. RBI

B. IRDA

C. SEBI

D. Finance Ministry

147 / 150

147. What is the Base Minimum Capital requirement specified by the SEBI for only
Proprietary trading without Algorithmic trading (Algo)?

A . Rs. 25 Lakhs

B. Rs. 20 Lakhs

C. Rs. 50 Lakhs

D. Rs. 10 Lakhs

148 / 150

148. The difference between option premium and intrinsic value is __________.

A. Strike Price

B. Time Value

C. Expiry Value

D. Option Value

149 / 150

149. The difference between option premium and intrinsic value is __________.

A.Strike Price

B. Time Value

C. Expiry Value

D. Option Value

150 / 150

150.

According to the Securities Contracts (Regulation) Rules, 1957, what is the minimum age for an individual to become a trading member?

A. 18 years

B. 21 years

C. 20 years

D. 25 years

Your score is

The average score is 68%

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