Mock Test 1 - TheMFCentral

NISM V-A Mock Test 1

NISM V-A (Mutual Fund Distributor Module) Exam | Mock Test 1

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1. In the wholesale debt market, the largest proportion of trading is seen in

Government Securities

T-Bills

PSU Bonds

Corporate Bonds

2 / 50

2. A close-ended mutual fund has a fixed:

NAV

Fund Size

Rate of Return

Number of Distributor

3 / 50

3. The investment policies listed out in the offer
document of a fund do not include

the specific securities in which the fund will invest

policy of diversification

the type of securities in which the scheme will invest principally

asset allocation pattern

4 / 50

4. An Open-ended mutual fund is one that has:

units available for sale and repurchase at all times

fixed fund size

an upper limit of NAV

an option to invest in any kind of securities

5 / 50

5. A better performance than the return on index
is given by

all fund managers

passive fund manager

non fund manager

an active fund manager

6 / 50

6. An investor in a closed-ended mutual fund can get his/her money back by selling his/her units

on stock exchange where the fund is listed

to a special trust at NAV

to the agent through which he/she subscribed to units of the fund

back to the fund

7 / 50

7. Equity derivative instruments are

contracts

notes

bonds

8 / 50

8. Shares of companies with large capital market
capitalisation

have greater growth potentia

are not available

none of the above

are more liquid

9 / 50

9. A high turnover rate for a fund indicates

high transaction costs

high returns to the investor

greater efficiency

a rising market

10 / 50

10. 'Key Information Memorandum' is

the Memorandum & Articles of Association of the AMC

a sheet containing historical NAVs of other fund schemes

an abridged version of the offer document

Annual Report of the AMC

11 / 50

11. A mutual fund owned by

All its investor

SEBI

The Government of India

AMFI

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12. The highest authority among the following is
the

Ministry of Finance

Company Law Board

SEBI

RBI

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13. The Price/Earnings (P/E) Ratio is an important
measure of a company's anticipated
performance. It is calculated using:

Market price and dividend

Market price and earning per share

Market price and face value

Market capitalisation and dividend

14 / 50

14. A funds NAV is affected by

all of the above

valuation of all investment securities held

Purchase and sale of investment securities

units sold or redeemed

15 / 50

15. The amount to buy 100 units of a scheme having a entry load of 1.5% and NAV of Rs. 20 each:

Rs. 2015

Rs. 2030

Rs. 1985

Rs. 2000

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16. An offer document contains an AMC's
investor grievance's history for the past

one fiscal year

2 fiscal years

six months

3 fiscal years

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17. A Gilt Fund is a special type of fund that invests

in Government Securities only

in short-term securities

in very high quality only

in instruments issued by companies with a sound track record

18 / 50

18. Commercial Paper is issued by Corporate bodies

to meet short-term working capital requirements

to retire long term debt

to pay dividend

to finance the acquisition of long term capital assets

19 / 50

19. A put provision in a debt issue allows

investors to extend the tenure of debt

investors to redeem debt prior to maturity

issuers to redeem debt prior to maturity

investor to put away the certificates in safe deposit vaults

20 / 50

20. If 10-year government securities Neil 10% and a 10-Year fixed deposit in a company yields 12%, the yield spread is

22%

10%

12%

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21. A company whose earnings are strongly related to the state of economy is known as

Economy stocks

Value stocks

Growth stocks

Cyclical stocks

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22. The greatest potential for growth in capital is offered by

Balanced funds

Debt funds

Growth funds

Gilt funds

23 / 50

23. The custodian of a mutual fund:

not required to be registered with SEBI

is appointed for safekeeping of securities

does not give or receive deliveries of physical securities

need not be an entity independent of the sponsors

24 / 50

24. The maximum load that a fund can charges determined by the

SEBI

Distribution Agents based on demand for the Fund

AMC

AMFI

25 / 50

25. The day on which NAV is calculated by a fund is known as

computation date

record date

valuation date

book closure date

26 / 50

26. A call provision in a debt issue allows the issuer to

redeem the debt on maturity

redeem the debt before maturity

extend the tenure of the debt

call out the names of the investors

27 / 50

27. Of the following fund types the highest risk is associated with

Balanced Funds

Debt Funds

Gilt Funds

Equity Growth Funds

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28. Are Mutual Fund agents/distributors in India
required to pass any examination to qualify to sell
Mutual Fund Units

Yes, a test conducted by AMFI

a Post Graduate university course

Yes, a test conducted by SEBI

29 / 50

29. The offer document is not a legal document

True

False

30 / 50

30. Debt securities bought at a discount to their face value are generally

none of the above

interest bearing

paying interest at a floating rate

zero coupon bonds

31 / 50

31. Technical analysis guides the decision on

whether company's technical personnel are adequately qualified

whether to buy or sell

none of the above

the right time to buy or sell

32 / 50

32. It may not be possible to reinvest interest received at the same rate as principal. This is known as

reinvestment risk

inflation risk

interest-rate risk

call risk

33 / 50

33. Units from an open-ended mutual fund are bought

from the fund itself

from AMFI

from a stock broker

on a stock exchange

34 / 50

34. After dividend declaration, unit-holders are
entitled to receive dividend within

42 days

one month

six weeks

one week

35 / 50

35. A compliance officer

cannot be appointed by the AMC

stands guarantee to the information contained in the offer document

cannot certify that the AMC's legal and procedural obligations are fulfilled

belongs to SEBI

36 / 50

36. Issuing and redeeming units of a mutual
fund is the role

the bankers

the trustees

the custodian

the transfer agent

37 / 50

37. The most suitable measure of fund performance for all fund types is

Total Return with reinvestment

NAV Change

Total Return

none of the above

38 / 50

38. A fixed term plan series is

A Fixed Term Corporate Bond

A Closed ended fund

An Open-ended fund

A Fixed term Bank Deposit

39 / 50

39. Market capitalisation of a company is
calculated by multiplying the number of
outstanding shares by

dividend yield

Rs.10

Current market value of each share

Face value of each share

40 / 50

40. NAVs of equity funds are not affected by

Events affecting the industry/sector in which the fund has invested

real estate prices

Stock market movements

Happenings in the companies in which the fund has invested

41 / 50

41. If the NAV of an open-ended fund was Rs.16 at the beginning of the year and Rs.22 after 13 months, the annualised change in NAV is

34.6%

37.5%

40.6%

6.0%

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42. The following need not be covered in a Key Information Memorandum

Disclaimer Clause

Risk Factors

Opening, Closing and earliest Closing Date of the offer

Functions and responsibilities of the sponsor, trustees, AMC and Custodian responsibilities

43 / 50

43. The AMC of a mutual fund cannot

act as a trustee of more than one mutual fund

cannot invest the funds in securities

undertake advisory services or financial consulting

cannot invest the funds in government paper

44 / 50

44. The sponsor of a mutual fund may be
compared to

Promoter of a Company

a director in a Company

the Chief Executive of a Company

an equity shareholder in a Company

45 / 50

45. When computing NAV of fund SEBI requires
accrual of major expenses to be accounted

when actually paid

annually

on a day to day basis

quarterly

46 / 50

46. The NAV of each scheme should be updated on AMFI's Website

Every Month

Every Quarter

Every Day

Every Hour

47 / 50

47. Distribution and sales practices are only partly regulated by SEBI at present

False

True

48 / 50

48. The trust that manages a mutual fund is
appointed by

SEBI

The sponsor of that mutual fund

The Finance Ministry

RBI

49 / 50

49. The entity that SEBI does not regulate is

stock exchanges

non-banking finance companies

share registrars

mutual funds

50 / 50

50. The additional yield required to account for the risk of default by the borrower is known as

yield extra

yield premium

yield plus

yield spread

Your score is

The average score is 60%

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Good luck with your preparation for the NISM Series V-A exam!

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