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CFP Mock Test Investment Planning

CFP Mock Test Investment Planning

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Published by Deep Shikha
Roots Institute of Financial Markets is an advanced research institute established by Roots Financial Planners. Mrs. Deep Shikha Malhotra, CFPCM is the promoter of the venture, having 11 years experience in the field of Education and Training and having 4 years experience in Financial Planning, who is the founder of Roots Institute of Financial Markets (RIFM). RIFM specializes in Financial Market Education and Services. RIFM is introducing Stock Market Courses of NSE and BSE and short-term training programs and Financial Planning Courses for providing state-of-the art facilities in the field of Financial Markets and Financial Planning. RIFM train personals like FMM Students, Dealers/Arbitrageurs, Financial market Traders, Marketing personals, Research Analysts and Managers.
Visit us at
www.rifmindia.com
www.rifmindia.wordpress.com
Roots Institute of Financial Markets is an advanced research institute established by Roots Financial Planners. Mrs. Deep Shikha Malhotra, CFPCM is the promoter of the venture, having 11 years experience in the field of Education and Training and having 4 years experience in Financial Planning, who is the founder of Roots Institute of Financial Markets (RIFM). RIFM specializes in Financial Market Education and Services. RIFM is introducing Stock Market Courses of NSE and BSE and short-term training programs and Financial Planning Courses for providing state-of-the art facilities in the field of Financial Markets and Financial Planning. RIFM train personals like FMM Students, Dealers/Arbitrageurs, Financial market Traders, Marketing personals, Research Analysts and Managers.
Visit us at
www.rifmindia.com
www.rifmindia.wordpress.com

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Published by: Deep Shikha on Feb 08, 2010
Copyright:Attribution Non-commercial

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12/03/2013

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Roots Institute of Financial Markets RIFM1197, NHBC Mahavir Dal Road, Panipat 132103, HaryanaPh No. 99961-55000, 99964-55055, Web:www.rifmindia.com, email: info@rifmindia.com
CFP Mock Test Investment Planning
1. Deposit Insurance and Credit Guarantee Corporation insures deposits in Banks up to the followinglimit per account. 1A Rs. 0.5 lakh.
B Rs. 1.0 lakh.
C Rs. 1.5 lakh.D No insurance is available.2. If one is a fundamental analyst, he/she would follow which one of the following approaches? 1A. Passive diversified portfolio approach
B. Quantitative Analysis (searching for undervalued securities)
C. Efficient market hypothesis-strongD. Efficient market hypothesis-weak3. Derivatives on gold related securities and government securities that are traded on the stockexchanges are regulated by _______. 1
A SEBI
B RBIC Department of Company AffairsD Company Law Board4. The bid-ask spread is________.1) Broker's commission 2) Dealer's gross income from a transaction 3) Larger for illiquidsecurities than for liquid ones.A 1B 2
C 3
D 1, 2 & 3.5. Priti wants to invest in XYZ Ltd's stock, however, she must wait several months till her Fixed Depositmatures. What type of option should she invest in to protect against the market value of the stockincreasing before her money becomes available?
A Buy a call option
B Buy a put optionC Write a put optionD Sell a call option6. The risk of the writer of an option is _______. 1A Market price at expiryB Purchase priceC Limited by the premium
D Unlimited
7.MFs are allowed to participate in securities lending. 1
 
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Roots Institute of Financial Markets RIFM1197, NHBC Mahavir Dal Road, Panipat 132103, HaryanaPh No. 99961-55000, 99964-55055, Web:www.rifmindia.com, email: info@rifmindia.comA False
B True
C SometimesD Cannot say8. Reciprocal of P/E ratio, E/P ratio measures___________ 1A Market price of a shareB Growth ratioC Cost of debt
D Opportunity Cost of capital
9. If the post tax rate of return on an investment is 8% and the inflation rate is 5% the real rate of returnis _______. 2A 3.5%.B 3%.
C 2.86%.
D -3%10.A 6% 2014 GOI Bond of Rs.100 Face Value trades at Rs.102 on 15/12/2004. There is a Call Option in2008. The Yield to Call will be ________ than the Yield to Maturity. 2
A Higher
B LowerC SameD Cannot Say11. A treasury bill of face value of Rs. 1,00,000/- is selling at Rs. 97,500/- today. It is slated to mature in60 days. The annual yield is _______.2A 13.3%
B 15.59%
C 16.43%D 14.27%12. If the Buying price of a property is Rs. 20 lakh, Net income is Rs. 2 lakh and Market yield is 8%, thevalue of the property is Rs. __________. 2A 20 lakhB 22 lakh
C 25 lakh
D None of the above13. A company offers a rights issue of one for two for Rs. 7 each. The current market price is Rs. 13. Theexpected ex-right market price would be Rs. _______. 2A 9B 10
C 11
D None of the above
 
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Roots Institute of Financial Markets RIFM1197, NHBC Mahavir Dal Road, Panipat 132103, HaryanaPh No. 99961-55000, 99964-55055, Web:www.rifmindia.com, email: info@rifmindia.com14. An MF scheme can borrow money up to ___% of its Asset Under Management for maximum ___months. 2A 30%, 3 monthsB 30%, 12 monthsC 10%, for any period
D 20%, 6months
15. Gita sold her equity holding of X Ltd on 1st of July, 2006. The total sale value of the shares was Rs.75,000/-. The Securities Transaction Tax that Gita is liable to pay would mandatorily be collected by _____. 2
A Stock Exchange
B Mutual FundC Income Tax AuthorityD Gita.s Broker16. Security A has a standard deviation of 23% and the market has a standard deviation of 18%. Thecorrelation coefficient r between Security A and the market is 0.80. What is the % of the change inSecurity A can be explained by changes in the market? 4A 80%B 50%C 36%
D 64%
17. The Portfolio consists of two securities, X and Y in the ratio of 70:30. Given that -i) Standard Deviation of X is 10%ii) Standard Deviation of Y is also 10% and covariance between them is 16%, what is the portfolio risk?
A 8.04%.
B 13.77%.C NILD 25%.18. Which of the following statements is/are true regarding strategic and tactical asset allocation?1) Strategic asset allocation involves selection of the correct asset allocation based on risk tolerance of the client, economic forecasts, and expectations of selected asset classes and rebalancing once or twiceper year to keep the portfolio within the parameters of the desired strategic mix.2) Tactical asset allocation involves evaluating asset classes or industries as to their value and sellingundervalued classes and purchasing overvalued classes. 4
A 1 only is true
B 2 only is trueC Both 1 & 2 are trueD Neither 1 nor 2 is true19.You are evaluating the following table for your customer:Fund Average Return (%) Standard Deviation (%) Beta

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