1 As per SEBI regulations, a mutual fund scheme should have at least ________ investors.?
- A) 10
- B) 15
- C) 20
- D) 25
2 Mutual fund units issued against purchase transactions would be subject to levy of stamp duty at ______ of the amount invested.
- A) 0.5%
- B) 0.05%
- C) 0.005%
- D) 0.01%
3 To whom does the profits or losses made by the mutual fund belong?
- A) The investors
- B) The Asset Management Company
- C) Fund Managers
- D) Trustees
4 What action has to be taken before deleting a default bank account from the registered bank account in a mutual fund folio?
- A) A new folio will have to be opened with the same joint holding as the new default account
- B) Another account has to be designated as the default bank account
- C) All the nominees of the mutual fund scheme have to sign on the change form irrespective of the mode of holding
- D) All of the above
5 The Asset Management Companies have to disclose the Total Expense Ratios (TER) of the various schemes on their websites on a ______ basis.
- A) Daily
- B) Weekly
- C) Monthly
- D) Annual
6 Segregated portfolio means _________?
- A) a portfolio which is kept aside for a ‘rainy day’ or contingency fund
- B) a portfolio which is created out of debt or money market securities affected by a credit event
- C) a portfolio which is left after removing poor credit quality papers
- D) All of the above
7 Identify the TRUE statement.
- A) While calculating scheme returns for an investor, if there is an entry load, then the initial value of the Net Asset Value (NAV) is taken as NAV minus Entry Load
- B) While calculating scheme returns for an investor, if there is an exit load, then the later value of the Net Asset Value (NAV) is taken as NAV minus Exit Load
8 For how long is the trail commission paid to the mutual fund distributor?
- A) For the first one year only
- B) For the first three years only
- C) For the first ten years only
- D) Till the money is held in the fund
9 What is negative Alpha?
- A) It is indicative of outperformance by the fund manager
- B) It is indicative of under-performance by the fund manager
- C) It is indicative of over-hedging by the fund manager
- D) It is indicative of under-hedging by the fund manager
10 An investor in India is investing in US Dollar based funds. He/She will benefit when ______
- A) The US Dollar becomes weaker
- B) The US Dollar becomes stronger
- C) The US Dollar reamins steady
- D) None of these
11 What is asset allocation?
- A) Deciding which and how many mutual fund schemes to invest in
- B) Finalizing which mutual fund schemes would deliver the highest returns in future
- C) Deciding how to invest money across various asset categories in line with one’s risk profile, financial objectives and current situation
- D) Deciding which asset category would outperform the others and investing in it
12 Business model, experience and proficiency in the business is a compulsory criteria for empanelment and review of which of the following category of mutual fund distributors?
- A) Institutional distributors who have points of presence in more than 10 locations
- B) Individual distributors who have points of presence in more than 10 locations
- C) Distributors who have received commission of over Rs. 1 Crore p.a. across industry
- D) All of the above
13 Equity Linked Savings Schemes (ELSS) are eligible for deduction under Section 80C of the Income Tax Act. However, such schemes have a lock-in period of how many years from the date of investment?
- A) 3 years from the date of allotment of each individual unit
- B) 3 years from the date of original investment even in case of subsequent purchases
- C) 5 years from the date of allotment of each individual unit
- D) If tax exemption is NOT availed, there will not be any lock-in period
14 Return from a fund is 9%, and the risk-free rate is 5%. The standard deviation is 3, and Beta is 1.6. What will be the NUMERATOR for calculating the Sharpe ratio?
- A) 3
- B) 6
- C) 1.6
- D) 4
15 Which document will an investor look at if they want to know the fundamental attributes of a mutual fund scheme?
- A) Key Information Memorandum (KIM)
- B) Addendum
- C) Scheme Information Document (SID)
- D) Statement of Additional Information (SAI)
16 Identify the FALSE statement: A. The best strategy in selecting a mutual fund scheme is that based on its past performance B. When the mutual fund distributor understands the needs of his investor, one can ignore the investment objective of the mutual fund schemes.
- A) Only A is false
- B) Only B is false
- C) Both A and B are false
- D) None of these
17 The employees of institutions that are into the distribution of mutual funds need to clear the _______ and obtain an Employee Unique Identification Number (EUIN) from AMFI.
- A) SEBI - VA Mutual Fund Distributors Certification Examination
- B) SEBI - VB Mutual Fund Distributors Certification Examination
- C) AMFI - VA Mutual Fund Distributors Certification Examination
- D) NISM - VA Mutual Fund Distributors Certification Examination
18 The heads of expenses that can be charged to a mutual fund scheme by the AMC is specified by SEBI - State whether True or False?
- A) True
- B) False
19 A _______ determines the interest rate sensitivity of a bond fund.
- A) Average Maturity
- B) Asset Under Management
- C) Credit Quality
- D) Expense Ratio
20 Monthly Income Plans (MIPs) have no exposure to Equity - State True or False?
- A) True
- B) False
21 When a NRI applies for mutual fund units, he also has to provide ________ along with other information while filling the application form.
- A) Current overseas address
- B) Passport details
- C) Investments made in the last one year
- D) Countries of residence in the last one year
22 By what percentage is the Securities Transaction Tax (STT) levied on re-purchase of units (by the mutual fund) of equity-oriented schemes (delivery based)?
- A) 1%
- B) 0.25%
- C) NIL
- D) 0.001%
23 Mutual funds have to follow the regulations of Reserve Bank of India (RBI) for investments in _______ .
- A) Securities market
- B) Gold
- C) Money market
- D) Commodity market
24 Which of these form a part of the 'Fit and Proper' criteria for eligible distributors that an AMC should check before empaneling a distributor?
- A) Aquate controls to delink sales functions from customer risk and investment objective evaluation
- B) The eligible distributor should have strict internal controls to limit investors' exposure to an asset class or fund house
- C) The eligible distributor should have the requisite Employee to Customer ratio as prescribed by SEBI
- D) All of the above
25 What is the full form of AGNI ?
- A) AMFI Guidelines for New issues and Investments
- B) AMFI Guidelines and Norms for Intermediaries
- C) AMFI Guidelines for New Investors
- D) AMFI Guidelines for Nominations and Investments
26 On final settlement, the buyer/holder of the option will recognize the favorable difference received from the seller/writer as ______ in the profit and loss account.
- A) Income
- B) Expense
- C) Loan
- D) Amortization
