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. The highest authority among the following is
the

SEBI

Company Law Board

RBI

Ministry of Finance

2 / 50

2. The custodian of a mutual fund:

is appointed for safekeeping of securities

not required to be registered with SEBI

need not be an entity independent of the sponsors

does not give or receive deliveries of physical securities

3 / 50

3. Shares of companies with large capital market
capitalisation

have greater growth potentia

are not available

none of the above

are more liquid

4 / 50

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

Rs. 2030

Rs. 2000

Rs. 1985

Rs. 2015

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5. NAVs of equity funds are not affected by

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

Stock market movements

Happenings in the companies in which the fund has invested

real estate prices

6 / 50

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

non fund manager

passive fund manager

all fund managers

an active fund manager

7 / 50

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

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

to a special trust at NAV

on stock exchange where the fund is listed

back to the fund

8 / 50

8. A funds NAV is affected by

all of the above

valuation of all investment securities held

units sold or redeemed

Purchase and sale of investment securities

9 / 50

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

when actually paid

on a day to day basis

annually

quarterly

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10. Commercial Paper is issued by Corporate bodies

to retire long term debt

to meet short-term working capital requirements

to pay dividend

to finance the acquisition of long term capital assets

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

dividend yield

Face value of each share

Current market value of each share

Rs.10

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12. The entity that SEBI does not regulate is

share registrars

stock exchanges

mutual funds

non-banking finance companies

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

Government Securities

PSU Bonds

T-Bills

Corporate Bonds

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

Balanced Funds

Equity Growth Funds

Debt Funds

Gilt Funds

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

Risk Factors

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

Opening, Closing and earliest Closing Date of the offer

Disclaimer Clause

16 / 50

16. A mutual fund owned by

All its investor

AMFI

SEBI

The Government of India

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

12%

10%

22%

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

one fiscal year

3 fiscal years

2 fiscal years

six months

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

Promoter of a Company

the Chief Executive of a Company

an equity shareholder in a Company

a director in a Company

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20. The AMC of a mutual fund cannot

cannot invest the funds in government paper

undertake advisory services or financial consulting

cannot invest the funds in securities

act as a trustee of more than one mutual fund

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

True

False

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

redeem the debt on maturity

call out the names of the investors

redeem the debt before maturity

extend the tenure of the debt

23 / 50

23. The offer document is not a legal document

True

False

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

NAV Change

none of the above

Total Return

Total Return with reinvestment

25 / 50

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

book closure date

computation date

record date

valuation date

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

Debt funds

Growth funds

Gilt funds

Balanced funds

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27. A high turnover rate for a fund indicates

high transaction costs

greater efficiency

a rising market

high returns to the investor

28 / 50

28. Equity derivative instruments are

contracts

bonds

notes

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29. 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

40.6%

34.6%

37.5%

6.0%

30 / 50

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

yield spread

yield plus

yield premium

yield extra

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

Value stocks

Cyclical stocks

Economy stocks

Growth stocks

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

interest-rate risk

call risk

reinvestment risk

inflation risk

33 / 50

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

AMC

Distribution Agents based on demand for the Fund

SEBI

AMFI

34 / 50

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

RBI

The Finance Ministry

The sponsor of that mutual fund

SEBI

35 / 50

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

in very high quality only

in short-term securities

in instruments issued by companies with a sound track record

in Government Securities only

36 / 50

36. A put provision in a debt issue allows

investors to extend the tenure of debt

investor to put away the certificates in safe deposit vaults

issuers to redeem debt prior to maturity

investors to redeem debt prior to maturity

37 / 50

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

interest bearing

paying interest at a floating rate

zero coupon bonds

none of the above

38 / 50

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

Every Quarter

Every Day

Every Month

Every Hour

39 / 50

39. Technical analysis guides the decision on

none of the above

the right time to buy or sell

whether to buy or sell

whether company's technical personnel are adequately qualified

40 / 50

40. A compliance officer

cannot be appointed by the AMC

belongs to SEBI

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

stands guarantee to the information contained in the offer document

41 / 50

41. 'Key Information Memorandum' is

the Memorandum & Articles of Association of the AMC

an abridged version of the offer document

a sheet containing historical NAVs of other fund schemes

Annual Report of the AMC

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

Fund Size

Number of Distributor

Rate of Return

NAV

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

an option to invest in any kind of securities

units available for sale and repurchase at all times

fixed fund size

an upper limit of NAV

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

Market price and earning per share

Market price and dividend

Market capitalisation and dividend

Market price and face value

45 / 50

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

from the fund itself

on a stock exchange

from AMFI

from a stock broker

46 / 50

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

policy of diversification

the specific securities in which the fund will invest

the type of securities in which the scheme will invest principally

asset allocation pattern

47 / 50

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

42 days

six weeks

one month

one week

48 / 50

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

the transfer agent

the trustees

the custodian

the bankers

49 / 50

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

Yes, a test conducted by SEBI

a Post Graduate university course

Yes, a test conducted by AMFI

50 / 50

50. A fixed term plan series is

A Fixed term Bank Deposit

An Open-ended fund

A Fixed Term Corporate Bond

A Closed ended fund

Your score is

The average score is 59%

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

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