Mock Test 1 - TheMFCentral

NISM V-A Mock Test 1

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

1 / 50

1. 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

2 / 50

2. 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

3 / 50

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

redeem the debt before maturity

extend the tenure of the debt

redeem the debt on maturity

call out the names of the investors

4 / 50

4. A high turnover rate for a fund indicates

greater efficiency

a rising market

high transaction costs

high returns to the investor

5 / 50

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

22%

12%

10%

6 / 50

6. 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

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

Debt Funds

Equity Growth Funds

Gilt Funds

Balanced Funds

9 / 50

9. Equity derivative instruments are

notes

bonds

contracts

10 / 50

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

Growth funds

Debt funds

Balanced funds

Gilt funds

11 / 50

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

NAV

Number of Distributor

Fund Size

Rate of Return

12 / 50

12. Technical analysis guides the decision on

none of the above

whether to buy or sell

whether company's technical personnel are adequately qualified

the right time to buy or sell

13 / 50

13. A funds NAV is affected by

units sold or redeemed

Purchase and sale of investment securities

all of the above

valuation of all investment securities held

14 / 50

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

Market capitalisation and dividend

Market price and earning per share

Market price and dividend

Market price and face value

15 / 50

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

asset allocation pattern

the type of securities in which the scheme will invest principally

the specific securities in which the fund will invest

policy of diversification

16 / 50

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

True

False

17 / 50

17. Shares of companies with large capital market
capitalisation

have greater growth potentia

are not available

are more liquid

none of the above

18 / 50

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

Current market value of each share

Face value of each share

Rs.10

dividend yield

19 / 50

19. A fixed term plan series is

A Fixed Term Corporate Bond

A Fixed term Bank Deposit

An Open-ended fund

A Closed ended fund

20 / 50

20. 'Key Information Memorandum' is

a sheet containing historical NAVs of other fund schemes

an abridged version of the offer document

Annual Report of the AMC

the Memorandum & Articles of Association of the AMC

21 / 50

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

in instruments issued by companies with a sound track record

in very high quality only

in short-term securities

in Government Securities only

22 / 50

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

on a stock exchange

from a stock broker

from AMFI

from the fund itself

23 / 50

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

Every Quarter

Every Day

Every Hour

Every Month

24 / 50

24. The offer document is not a legal document

False

True

25 / 50

25. Commercial Paper is issued by Corporate bodies

to pay dividend

to finance the acquisition of long term capital assets

to retire long term debt

to meet short-term working capital requirements

26 / 50

26. A mutual fund owned by

SEBI

The Government of India

AMFI

All its investor

27 / 50

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

valuation date

computation date

record date

book closure date

28 / 50

28. 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%

29 / 50

29. The highest authority among the following is
the

Ministry of Finance

SEBI

Company Law Board

RBI

30 / 50

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

passive fund manager

an active fund manager

all fund managers

non fund manager

31 / 50

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

call risk

inflation risk

interest-rate risk

reinvestment risk

32 / 50

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

3 fiscal years

six months

one fiscal year

2 fiscal years

33 / 50

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

the custodian

the bankers

the transfer agent

the trustees

34 / 50

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

Total Return

NAV Change

Total Return with reinvestment

none of the above

35 / 50

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

one week

one month

six weeks

42 days

36 / 50

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

SEBI

The sponsor of that mutual fund

The Finance Ministry

RBI

37 / 50

37. A compliance officer

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

stands guarantee to the information contained in the offer document

belongs to SEBI

cannot be appointed by the AMC

38 / 50

38. The AMC of a mutual fund cannot

cannot invest the funds in securities

cannot invest the funds in government paper

act as a trustee of more than one mutual fund

undertake advisory services or financial consulting

39 / 50

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

Cyclical stocks

Value stocks

Growth stocks

Economy stocks

40 / 50

40. NAVs of equity funds are not affected by

real estate prices

Stock market movements

Happenings in the companies in which the fund has invested

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

41 / 50

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

PSU Bonds

Corporate Bonds

Government Securities

T-Bills

42 / 50

42. A put provision in a debt issue allows

investors to redeem debt prior to maturity

investor to put away the certificates in safe deposit vaults

issuers to redeem debt prior to maturity

investors to extend the tenure of debt

43 / 50

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

an equity shareholder in a Company

the Chief Executive of a Company

a director in a Company

Promoter of a Company

44 / 50

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

yield premium

yield spread

yield plus

yield extra

45 / 50

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

Distribution Agents based on demand for the Fund

AMFI

AMC

SEBI

46 / 50

46. 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. 2015

Rs. 2000

Rs. 1985

47 / 50

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

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

Opening, Closing and earliest Closing Date of the offer

Risk Factors

Disclaimer Clause

48 / 50

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

zero coupon bonds

none of the above

interest bearing

paying interest at a floating rate

49 / 50

49. The entity that SEBI does not regulate is

stock exchanges

share registrars

non-banking finance companies

mutual funds

50 / 50

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

annually

on a day to day basis

when actually paid

quarterly

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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