Roots Institute of Financial Markets RIFM

Practice Book NISM-SERIES-V-A MUTUAL FUND DISTRIBUTORS CERTIFICATION EXAMINATION

Roots Institute of Financial Markets
1197 NHBC Mahavir Dal Road. Panipat. 132103 Haryana. Ph.99961-55000, 0180-2663049 email: info@rifm.in Web: www.rifm.in

Forward
Welcome to RIFM

Thanks for choosing RIFM as your guide to help you in NCFM/CFP Certification.

Roots Institute of Financial Markets is an advanced research institute Promoted by Mrs. Deep Shikha CFPCM. RIFM specializes in Financial Market Education and Services. RIFM is introducing preparatory classes and study material for Stock Market Courses of NSE , NISM and CFP certification. RIFM train personals like FMM Students, Dealers/Arbitrageurs, and Financial market Traders, Marketing personals, Research Analysts and Managers.

We are constantly engaged in providing a unique educational solution through continuous innovation.

Wish you Luck……………

Faculty and content team, RIFM

Roots Institute of Financial Markets
1197 NHBC Mahavir Dal Road. Panipat. 132103 Haryana. Ph.99961-55000, 0180-2663049 email: info@rifm.in Web: www.rifm.in

Com.in Web: www. Ravi Malhotra B.Com. AMFI Certified for Mutual Funds IRDA Certified for Life Insurance IRDA Certified for General Insurance PG Diploma in Human Resource Management CA.Com.in .Our Team Deep Shikha Malhotra CFP CM M..Com.rifm.Com. Ph. Previous (10th Rank in Kurukshetra University) AMFI Certified for Mutual Funds IRDA Certified for Life Insurance Certification in all Modules of CFPCM Curriculum (FPSB India) Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road.Ed.99961-55000. 0180-2663049 email: info@rifm. AMFI Certified for Mutual Funds IRDA Certified for Life Insurance NCFM Certification In: Capital Market (Dealers) Module Derivatives Market (Dealers) Module Commodities Market Module Kavita Malhotra M. NCFM Diploma in Capital Market (Dealers) Module AMFI Certified for Mutual Funds IRDA Certified for Life Insurance CM Neeraj Nagpal CFP B. Panipat. 132103 Haryana. FCA DISA (ICA) CM CERTIFIED FINANCIAL PLANNER Vipin Sehgal CFP CM B. B.

rifm. Ph.99961-55000.in Web: www. of Questions Maximum Marks Pass % Negative Marking % 120 Min. Panipat. 0180-2663049 email: info@rifm. 132103 Haryana.NISM-SERIES-V-A MUTUAL FUND DISTRIBUTORS CERTIFICATION EXAMINATION Exam Pattern Test Duration No. 100 100 50 25 Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road.in .

in Web: www. Scheme Selection 10. Offer Document 5. Ph. Risk.Selecting the Right Investment Products For Investors 11. Fund Structure And Constituents 3.NISM-SERIES-V-A MUTUAL FUND DISTRIBUTORS CERTIFICATION EXAMINATION Index Unit 1. Accounting Valuation And Taxation 7. Legal And Regulatory Environment 4. Recommending Model Portfolios And Financial Plans Sample Paper 1 Sample Paper 2 Pages 1-9 10-16 17-24 25-31 32-38 39-47 48-54 55-67 68-72 73-77 78-81 82-85 86-100 101-115 Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. 0180-2663049 email: info@rifm. Return And Performance Of Funds 9. Helping Investors With Financial Planning 12.rifm. Concept And Role Of Mutual Fund 2.in .99961-55000. Fund Distribution And Sales Practices 6. Panipat. 132103 Haryana. Investor Services 8.

Distributors C. Any of the above 2 3 4 5 6 7 26 _____________ are open for investors to enter or exit at any time even after the NFO. Realized capital gain C. Ph. A.in Web: www. A. A. Mutual funds B. All of the above Mutual fund mobilizes different pools of money. Valuation gain B. Share capital B.rifm. to invest in different markets and securities. Panipat. Such pool of money is called______________. A. Equity capital C. Bond C. 132103 Haryana. None of the above Their primary of MF is to assist investors in earning an income or building their wealth. Unit capital D. Shares D. Registrars D. True B. Mutual fund scheme C. False The mutual fund industry offers livelihood to a large number of ____________. None of the above The number of units multiplied by its face value is the capital of the scheme called______________. Close ended funds Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. False The mutual funds can keep a check on the operations of the investee company and their corporate governance and ethical standards. 0180-2663049 email: info@rifm. A. A. True B. A. None of the above When investors purchases and sells investments and earn capital gains. Employees B.Chapter 1 Concept and Role of a Mutual Fund 1 ___________ are a vehicle to mobilize moneys from investors. Profit in mutual funds D. Mutual fund deed D. Mutual fund trust B.99961-55000.in . These are called____________ A.

Open ended funds C. Panipat. All of the above 27 When existing investors buy additional units or new investors buy units of the open ended scheme. 132103 Haryana. True B. Interval funds D.99961-55000. False Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. Ph.rifm. 0180-2663049 email: info@rifm.in Web: www. it is called a sale transaction.in .B. A.

99961-55000.rifm.1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 A A A D B C B A A C C C B B A D A 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 Answer Sheet Chapter 1 A 35 D B 36 D B 37 D B 38 A A 39 A A 40 B D 41 C C 42 C B 43 D A 44 C A 45 B A 46 C A 47 D B 48 A C 49 C D 50 B D 51 A 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 A B D A B B C D B B C B B B A Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. Panipat. Ph.in . 132103 Haryana.in Web: www. 0180-2663049 email: info@rifm.

Investments from people other than Indian residents D.in. True B. AMFI D. depositories. False The objectives of AMFI are___________. All of the above AGNI refers to ______________. Debt market B. To interact with the Securities and Exchange Board of India(SEBI) C.in .sebi. A.99961-55000. Money market D.in Web: www.rifm.Chapter-3 Legal and Regulatory Environment 1 __________regulates mutual funds. Panipat. False RBI regulates the _________. A. A. To recommend and promote best business practices B. RBI B. 0180-2663049 email: info@rifm. None What is the full form of SRO? A. None of the above Mutual funds need to comply with RBI’s regulations regarding investment in the ____________. A. Statutory Rules Organization D. SEBI C. Security market C. Both of the above D. All of the above An updated and comprehensive list of circulars issued by SEBI can be found in the Mutual Funds section of SEBI’s website www. A. 2 3 4 5 6 7 8 9 Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. All of the above Stock exchanges are regulated by ___________. True B. Money Market B. A. Reserve Bank of India D. A.gov. RBI C. To represent to the Government. None of the above Mutual funds in India have constituted a SRO for themselves. Ph. Statutory Regulatory Organization C. Self Regulatory Organizations B. SEBI B. Investment from outside the country C. 132103 Haryana. custodians and registrars & transfer agents in the country.

None Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. 0180-2663049 email: info@rifm. B. Diversify Debt Scheme C.in . A.A.rifm. Panipat.99961-55000. D. AMFI Guidelines & Norms for Investors AMFI Guidelines & Norms for Intermediaries AMFI Guidelines & Norms for Investments None of the above 10 “To generate capital appreciation from a portfolio of predominantly equity related securities” is an objective of _____________. Ph. C. 132103 Haryana. Diversify Equity Scheme B.in Web: www. Balanced Scheme D.

in .rifm. Panipat.99961-55000. 0180-2663049 email: info@rifm.in Web: www. 132103 Haryana. Ph.1 2 3 4 5 6 7 8 9 10 11 12 13 14 B A C D A A B D B A B C D D 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Answer Sheet Chapter 3 A 29 C A 30 B B 31 A C 32 B C 33 A B 34 C A 35 D D 36 D C 37 D A 38 C A 39 A B 40 A B 41 B A 42 C 43 44 45 46 47 48 49 50 51 52 53 54 55 56 B D A A C A B D D B C A B D Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road.

None of the above Who are Non Bank Distributors_____________ A.in .rifm. Either A & B The Intermediaries can fulfill the customer needs_____________. Non banking finance companies D. Individual Financial Advisors B. Product manufacturers B. All of the above UTI. Investor D. A. A. Panipat. True B. LIC or other issuer of the investment product (often referred to in the market as_______________. True B. Independent Financial Advisors D. individual agents would distribute units of ______________. False Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. Personally B. Through a team C. A. 0180-2663049 email: info@rifm. BSE C. Institutional Financial Advisors C. A.99961-55000.Chapter 5 Fund Distribution and Channel Management Practices 1 Historically.in Web: www. Securities distribution companies C. NSE B. A. Unit trust of India B. All of the above 2 3 4 5 6 7 24 The distributors have to disclose all the commissions payable to them for the different competing schemes of various mutual funds from amongst which the scheme is being recommended to the investor. A. False Mutual fund transaction engines are__________. A. With support of technology D. Government’s Small Savings Schemes D. Product Dealer C. Insurance Policies C. None of the above IFAs stand for________________. Both D. Ph. Brokerages B. 132103 Haryana. All of the above SEBI has facilitated buying and selling of mutual fund units through the stock exchanges.

Panipat. Ph. 0180-2663049 email: info@rifm.rifm. 132103 Haryana.in .99961-55000.1 2 3 4 5 6 7 8 9 10 11 12 D A C D A C D A A D B C 13 14 15 16 17 18 19 20 21 22 23 24 Answer Sheet Chapter 5 A 25 D B 26 C A 27 D B 28 A B 29 A D 30 D B 31 B C 32 C B 33 B A 34 D A 35 D A 36 B 37 38 39 40 41 42 43 44 45 46 47 B B C A B A D A A B A Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road.in Web: www.

rifm. Price to Book Value A ________ Fund maintains a portfolio that is in line with the index it mirrors. Price to Earnings Ratio C. Return B. 7. 33. Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. 4. Debt Fund _____ Ratio indicates of how much each share is worth. 132103 Haryana. A. in relation to the company’s earnings A.Chapter 8 Return. Price to Earnings Ratio C. Ph.99961-55000. Competitive position D. None of the above Fundamental Analysis entails review of the company’s fundamentals __________ A. as per the company’s own books of accounts. of equity shares A. Risk & Performance of Funds 1. Book Value per Share D. A. Price to Book Value Which ratio tells the investors how much profit the company earned for each equity share that they own. 0180-2663049 email: info@rifm. Earnings per Share B. Financial statements B. 2. 3. Equity fund D.in . True B. 5. 6. Earnings per Share B. Panipat. Price to Book Value The difference between the yield on Gilt and the yield on a non-Government Debt security is called its yield Spread.in Web: www. All of the above Earnings per Share (EPS) = Net profit before tax ÷ No. Price to Earnings Ratio C. A. Portfolio D. Profit C. False ________ Ratio indicates how much investors in the share market are prepared to pay (to become owners of the company). Earnings per Share B. Book Value per Share D. Passive Fund C. Book Value per Share D. The __________ is the main driver of returns in a mutual fund scheme. Active fund B. Quality of management C. A.

A. True B. Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road.in . CARE and FITCH D.e. is measured by Credit Rating companies A.in Web: www. False Credit Rating companies are like ___________________ A. False 34.99961-55000. 0180-2663049 email: info@rifm. ICRA C. True B. All of the above 35. The possibility of a non-government issuer defaulting on a debt security i. 132103 Haryana. Ph. its credit risk. CRISIL B. Panipat.rifm.

132103 Haryana.in .1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 C D B B A B C D A C B A A B C A B B B B 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 A A D B B A B A D B C B A A D B C A B A Answer Sheet Chapter 8 41 B 61 42 A 62 43 D 63 44 D 64 45 A 65 46 A 66 47 B 67 48 C 68 49 C 69 50 B 70 51 A 71 52 B 72 53 B 73 54 A 74 55 B 75 56 A 76 57 C 77 58 D 78 59 A 79 60 A 80 B A B C D B B A A D A D D A A C A A A A 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 B C D C A A A B A B C A A D A D D Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. Ph.in Web: www. Panipat. 0180-2663049 email: info@rifm.rifm.99961-55000.

132103 Haryana. All of the above As a structured approach. Equity scheme B. 0180-2663049 email: info@rifm. then the NAV of the index fund will go up. Panipat. Gold and real estate D. None If the bench mark index goes down. Both D.Chapter – 9 Scheme Selection 1 Mutual funds are a vehicle that helps an investor take exposure to asset classes. A. Active B.C C. Ph. Debt C. True B. A. A.C B.A. A. True B.rifm. A. 3 B. True B. the sequence of decision making is as follows: Step 1 – Deciding on the scheme category Step 2 – Selecting a scheme within the category Step 3 – Selecting the right option within the scheme A. A. False 2 3 4 5 6 7 31 The comparable for a liquid scheme is___________. Savings Bank account Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. A. 5 Index funds are passive funds. 2 C.99961-55000.A D.in Web: www. False If the investor has a long enough horizon. and a higher risk. Passive C. 4 D. then his investment will do well in line with the overall market. Equity B. A.B. False An investor in a ___________fund is bearing a higher cost for the fund management. B. Balanced Scheme C.B. Gilt Fund D. A.B Investing in equities with a horizon below _________years can be dangerous.in . C.C.

132103 Haryana.99961-55000. Panipat. 0180-2663049 email: info@rifm.in Web: www.1 2 3 4 5 6 7 8 9 10 11 D A B A A B A B B A A Answer Sheet Chapter 9 12 D 23 13 C 24 14 C 25 15 A 26 16 A 27 17 A 28 18 B 29 19 D 30 20 A 31 21 B 32 22 B 33 C A E A B B A B D C B Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road.rifm. Ph.in .

99961-55000. The Fund manager A Mutual Fund is supervised by A. Registrar of the fund B. Automatically leads to investment in equity shares D. 7. Panipat. they are not distinct from the trust C. 0180-2663049 email: info@rifm. 4.000 D. A Board of Trustees or A Trustee Company D. if the fund charges 0. A load means A. By AMFI D. IRR B. All of these 2. trust is established by the sponsor with approval from SEBI B. 3.8750 B. Current yield D.4737 Investment in an Equity Linked Savings Scheme (ELSS) A. The AMC B. 132103 Haryana.1250 C. 10. Fund trustee C.50 on 3rd September 2002. By the person’s entity guaranteeing the return as per the offer document Who is responsible for filing details of the fund’s portfolio with SEBI A. An amount which is recovered from the investor C. 6. An amount paid to the broker by the fund D. the funds are managed by the AMC The NAV of XYZ equity scheme is Rs. Requires the investment to be locked in for a period of 3 years C.in . Duration Shortfall in the case of assured returns schemes are met A. 10. By the SEBI C. An amount recovered from the registrar B. Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. 7.Sample paper 1 1. 13. Ph. Registrar Unit holders cannot sue the trust as A. trust is not a legal entity D. 10. By the Custodian B.25% as the exit load.in Web: www. Custodian D. Entitles the investor to claim income tax rebate B. 8. Coupon rate C. The Sponsor C.rifm. what would be the repurchase price for the investor ? A. An amount paid by the fund to the regulator (SEBI) YTM can also be defined as bond’s A. 5.

in .rifm.in Web: www. Panipat.1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 B A D D C B D D D E C E A D A C A A D C A B A A D Answer Sheet Sample Paper 1 26 B 51 A 27 D 52 A 28 D 53 D 29 C 54 C 30 D 55 C 31 A 56 B 32 A 57 C 33 D 58 D 34 D 59 D 35 A 60 D 36 A 61 C 37 B 62 D 38 D 63 D 39 D 64 D 40 D 65 B 41 B 66 A 42 D 67 A 43 D 68 B 44 D 69 D 45 A 70 A 46 E 71 D 47 D 72 A 48 D 73 A 49 B 74 A 50 D 75 C 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 C D C D C B C A A D D D D D E C D C D C A D D D C Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. 0180-2663049 email: info@rifm.99961-55000. Ph. 132103 Haryana.

Which of the following comparisons is an ideal comparison A.in Web: www. which of your following clients would you strongly advise to start investing for retirement A. 4. All of the above The process of splitting an investment portfolio between the various classes of assets such as real estate. B. Rupee cost averaging B. Providing periodic statements to unit holders regarding their transactions The key information memorandum of a mutual fund scheme is available A. A & b only While benchmarking a fund’s performance relative to other mutual funds. Value averaging As a financial planner. 6. Bank deposits B. Ph. Asset allocation C. securities C. At the Amc’s office B. NSC 5. C. 3. Select funds with similar investment objectives Select funds of comparable size Both of the above None of the above 2. Stock selection D. Redemption of units C.rifm. At the branches of all banks D. Comparing two debt funds investing in govt. it is important to A. At the office of authorized agents C. Nomination and transfer facilities B.in . bonds. Comparing two balanced funds D.Sample paper 2 1. 26 year old unmarried executive with 2 yrs experience in a job B. Which of the following does not generally guarantee return on capital A. 30 year old executive with his wife working as well D. Comparing two equity growth funds B. 31 year old unmarried son of a wealthy businessman. 0180-2663049 email: info@rifm. Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. Mutual funds in India do not offer A. 132103 Haryana. PDF C. equities. and cash is best described as …. A. Loans against units D. Units of mutual funds D. D.99961-55000. Panipat. 30 year old executive supporting a family of wife. child and mother C. 7..

0180-2663049 email: info@rifm.in . Ph. Panipat.in Web: www. 132103 Haryana.rifm.1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 C D C D B B C D A D C C A D B A A A B B D C A A C Answer Sheet Sample Paper 2 C C 26 51 C A 27 52 D C 28 53 C A 29 54 C B 30 55 A B 31 56 A D 32 57 C B 33 58 D D 34 59 B A 35 60 A C 36 61 B D 37 62 A A 38 63 D D 39 64 E C 40 65 D C 41 66 D A 42 67 D D 43 68 A D 44 69 B D 45 70 C A 46 71 D C 47 72 B A 48 73 D A 49 74 B A 50 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 100 A D D B B D D A D D A D A A B A A B B B B A B C A Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road.99961-55000.

in any manner. or any other persons involved in the preparation of this publication expressly disclaim all and any contractual. therefrom.in .rifm. Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road.Roots Institute of Financial Markets (RIFM) “Every effort has been made to avoid any errors or omission in this book. 132103 Haryana. its directors.in Web: www. Panipat. 0180-2663049 email: info@rifm. In spite of this error may creep in. tortuous. or other form of liability to any person (purchaser of this publication or not) in respect of the publication and any consequences arising from its use. author(s). It is notified that neither the publisher nor the author or seller will be responsible for any damage or loss of action to anyone of any kind. ROOTS Institute of Financial Markets. by any person in reliance upon the whole or any part of the contents of this publication. Ph. shall be taken care of in the next printing. No person should act on the basis of the material contained in the publication without considering and taking professional advice. Any mistake. error or discrepancy noted may be brought to our notice. which. including any omission made.99961-55000.

3.rifm. Ph.in Ph. 1000 Per Module 1. FINANCIAL MARKETS: A BEGINNERS MODULE SECURITIES MARKET (BASIC) MODULE CAPITAL MARKET (DEALERS) MODULE DERIVATIVES MARKET (DEALERS) MODULE COMMODITIES MARKET MODULE INVESTMENT ANALYSIS AND PORTFOLIO MANAGEMENT OPTION TRADING STRATEGIES NISM Modules Practice Books (about 500 Questions per Module) Cost Rs.99961-55000. 2. INTRODUCTION TO FINANCIAL PLANNING INVESTMENT PLANNING RISK ANALYSIS OF FINANCIAL PLANNING RETIREMENT PLANNING TAX PLANNING CFP Certification Modules ---Practice Books (about 800 Questions per Module) Cost Rs. 132103 Haryana. 4.rifm. 7. CURRENCY DERIVATIVES CERTIFICATION EXAMINATION CFP Certification Modules ---Study Notes (Detailed Study notes as per FPSB syllabus) Cost Rs. 2.in Web: www. 4. 5. 5. MUTUAL FUND DISTRIBUTORS CERTIFICATION EXAMINATION 2.in Roots Institute of Financial Markets (RIFM) . INTRODUCTION TO FINANCIAL PLANNING INVESTMENT PLANNING RISK ANALYSIS OF FINANCIAL PLANNING RETIREMENT PLANNING TAX PLANNING Advance Financial Planning Module--Practice Book & Study Notes (Cost Rs. Panipat. 1197 NHBC Mahavir Dal Road. 3. 5. 3. 5000/-) Roots Institute of Financial Markets 1197 NHBC Mahavir Dal Road. 132103 Haryana.in Web: www. 800 Per Module 1. 2. 0180-2663049 email: info@rifm. 6. 800 Per Module 1. 1000 Per Module 1.Helpful Books from RIFM NCFM Modules Practice Books (about 500 Questions per Module) Cost Rs.99961-55000. 0180-2663049 email: info@rifm. Panipat. 4.

Sign up to vote on this title
UsefulNot useful