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1) Most of the Arbitrage Funds take Contrary Position of Futures and Option

1. TRUE
2. FALSE

2) The Offshore Fund is also known as Feeder Fund


1. TRUE
2. FALSE

3) If an Indian MF sectors sees potential in making investment in China, it will tie up with
Chinese fund. In India this will be known as Feeder, while in China it will be called
1. China made portfolio
2. Arbitrage fund
3. Host fund
4. Offshore fund

4) Investment objective is closely linked to


1. Scheme
2. Option
3. Plan
4. SIP

5) All are the commodities except


1. Gold
2. Crops
3. Industrial metal
4. Real estate

6) MIP is a debt fund


1. TRUE
2. FALSE

7) FMP is mostly a closed end fund


1. TRUE
2. FALSE

8) Units are repurchased in closed end fund at


1. Higher than NAV
2. Lower than NAV
3. Whatever the price higher than NAV or lower than NAV
4. At NAV price only

9) Which of these instruments is not issued by the corporate?


1. Debentures
2. Commercial paper
3. Fixed Deposits
4. Bonds

10) Interval funds are


1. Largely open-ended convert into close-ended at pre-specified intervals
2. Largely close-ended convert into open-ended at pre-specified intervals
3. Always open-ended
4. None of the above
11) In India the first mutual fund was established in
1. 1963
2. 1964
3. 1987
4. 1993

12) Mutual Funds shall be recommended as


1. A get rich quick investment option
2. Investments to achieve long term goals
3. Guaranteed returns
4. Direct investment in capital market

13) Investments in a Equity Linked Savings (ELSS)


1. Entitles the investor to claim income tax rebate
2. Requires the investment to be locked in for a period of 3 years
3. Automatically leads to investment in equity shares
4. All of these

14) Investing through mutual fund is a better option than investing directly in the stock market
because
1. Identifying stocks is a difficult process
2. Agents get commissions on mutual fund investment
3. Returned are guaranteed by mutual funds
4. None of the above

15) Gold sector fund invest in gold


1. TRUE
2. FALSE

16) Profit/loss earned/incurred by a mutual fund scheme __________


1. Shared by AMC and the investors according to pre-agreed ratio
2. Belong to the investors
3. Belong to the AMC
4. Shared by the trustees and the investors according to pre-agreed ratio

17) In case of losses in a Mutual Fund scheme, investors may have to bear loss of amount higher
than invested.
1. TRUE
2. FALSE

18) The pool of money mobilized by mutual fund houses to accommodate investors varied
preferences is called ___________
1. Unit capital
2. Mutual Fund corpus
3. Mutual Fund schemes
4. Unit reserve

19) Which of the following is / are the advantages of Mutual Fund.


1. Wealth generation through professional management.
2. Exposure to wide range of securities with smaller investment
3. Benefit of economies of scale
4. All of the above
20) Funds that combine the feature of close-ended and open-ended funds are called
1. Flexible funds
2. Hybrid funds
3. Interval funds
4. Balanced funds

21) Passive fund is expected to –


1. Beat the return of the index it is based upon.
2. Furnish the returns of the market index it is based upon.
3. Keep the costs low.
4. Both b and c

22) Gold funds and gold sector funds are the same type of funds.
1. TRUE
2. FALSE

23) Thematic funds is a variant to ________________


1. Diversified fund
2. Sector fund
3. Balanced fund
4. Equity fund

24) Investors in international funds invest in a ___________ which is re-invested in a _________


1. Feeder fund, host fund
2. Host fund, feeder fund
3. Local fund, international fund
4. International fund, local fund

25) In which of the following do debt funds no invest-


1. Government debt instruments
2. Corporate paper
3. Financial institutions bonds
4. Equity of private companies

26) Funds, which invest only in the stocks comprising an index and aim to give returns
commensurate with the returns, are called __________.
1. Index funds
2. Active funds
3. Dormant funds
4. None of the above

27) Mutual Funds can be defined as –


1. A link between the saving public and the capital markets
2. An active participant in promoting good corporate governance, investor protection.
3. A participant that has brought in liquidity into the financial system.
4. All of the above

28) A Mutual Funds’ investments are guided by the-


1. AMC
2. Board of trustees
3. Investment objectives
4. Unit holders
29) Gilt funds-
1. Have no risk at all
2. Have interest raterisk but no credit risk
3. Have credit risk but no interest risk
4. Have credit risk, interest rate risk and re-investment risk

30) In India, Mutual fund schemes are not permitted to invest in commodities.
1. TRUE
2. FALSE

31) Exchange traded funds are open-ended funds __________


1. That are open for sale and re-purchase by the fund anytime.
2. The trade in the stock exchange
3. That trades in over the counter exchange
4. All of the above

32) Commodity sector funds are not permitted to operate in India.


1. TRUE
2. FALSE

33) A closed-end Mutual Fund has a fixed-


1. NAV
2. Tenure
3. Rate of return
4. Number of distributors

34) An open-ended Mutual Fund is one that has:


1. An option to invest in any kind of security
2. Unit available for sale and repurchase at all times
3. An upper limit on its NAV
4. A fixed fund size

35) Gold sector funds are a type of __________


1. Gold funds
2. Equity sector funds
3. Debt funds
4. Equity diversified funds

36) Monthly income plans have to declare a dividend every month.


1. TRUE
2. FALSE
37) Floating rate debt securities means________________
1. Debt securities whose rating changes from time to time
2. Debt securities where the interest rate payable by the issuer changes in line with the
market
3. Debt securities which offers multiple interest rate structure.
4. Debt securities which have no maturity period.
38) _______________ are funds where the manager has the flexibility to choose the investment
portfolio.
1. Actively managed funds
2. Flexible asset allocations funds
3. Fixed asset allocation funds
4. Diversified funds
39) Of these, which is an example of a Passive fund management strategy?
1. Duration management
2. Buy and hold
3. Credit selection
4. Prepayment selection

40) NAV of equity income/ dividend yield scheme tends to fluctuate higher than other equity
schemes.
1. TRUE
2. FALSE

41) Fixed maturity plans are _________


1. Open-ended funds
2. Close-ended funds
3. Interval funds
4. Hybrid funds

42) The correct description of a mutual fund is:


1. It is a company
2. It is a development financial institution
3. It is a financial intermediary
4. It is non-banking finance company

43) Who is author of the book “The intelligent investor”?


1. Benjamin Graham
2. Peter Lynch
3. John Templeton
4. Warren Buffet

44) When investors sale their units in Mutual fund scheme, it is called _________
1. Sale transaction
2. Buyback transaction
3. Buy transaction
4. Re-purchase transaction.

45) Gilt funds invest in ____________


1. Treasury bills
2. Government securities
3. Call money
4. Both a and b

46) Capital Protected Schemes are usually structured to __________


1. Guarantee the principal repayment
2. Guarantee the return on investment
3. Ensure the principal repayment
4. Ensure the return on investment.

47) An investor of a Mutual fund scheme cannot invest directly.


1. TRUE
2. FALSE

48) Which of the following are fundamental attributes of a Mutual Fund scheme-
1. Main objective of the scheme
2. Aggregate fees and expenses charged to the scheme
3. Investment pattern
4. All of the above
49) Which of the following is/are not the advantages of Mutual Fund-
1. Employment generation
2. Economic development
3. Decrease in crime rate
4. Improves government exchequer

50) Close-ended funds have a fixed maturity and can be bought and sold________
1. Among investors
2. In a stock exchange
3. After lock in period
4. Never

51) Junk bond schemes invest in companies that are __________.


1. De-listed
2. Of poor profitability
3. Of poor track record
4. Of poor credit quality

52) What is an “Equity Warrant?”


1. It is nothing but an Equity share of a company
2. It is a debt instrument that offers fixed interest rate
3. It is an instrument that gives the holder the right to purchase equity share in a company
at a fixed price in future.
4. None of the above

53) Mutual Fund mobilizes money from investors to-


1. Form a mutual benefit fund
2. Invest in different markets and securities
3. Fund business houses working capital
4. Float ponzi schemes

54) A Mutual Fund is:


1. A partnership
2. A pass through vehicle
3. A private trust
4. An association of persons

55) The following characteristic is not present in an open-ended fund-


1. Facility to buy or sell back units to the fund
2. A fixed unit corpus for the life of the scheme
3. Regular declaration of NAV
4. Regular disclosure of portfolio

56) In open-ended funds the pool of money remains constant.


1. TRUE
2. FALSE

57) Volatility of a Mutual Fund is influenced by-


1. Number of securities in the portfolio
2. Nature of securities in the portfolio
3. Fund manager’s success in timing the market
4. All of the above
58) What is not an advantage in investing in Mutual Funds against equity?
1. Professional management
2. Diversification of risk
3. Reduction in cost
4. Tailor made portfolios

59) Funds, which are normally close-ended, but become open-ended at pre-specified intervals,
are called _____________
1. Periodic funds
2. Flexible funds
3. Interval funds
4. Close-ended open funds

60) Arbitrage funds take contrary positions in ____________


1. Two different exchanges viz. NSE and BSE.
2. Two different segments viz. equity and F&O.
3. Two different segments viz. equity and commodity
4. Both a and b

61) The NAV of gold sector funds does not closely mirror gold prices.
1. TRUE
2. FALSE

62) Which of the following is/are the advantages of Mutual Fund-


1. Offers systematic approach to investment.
2. Offers portfolio customization
3. Investors control is there to control costs of running the scheme.
4. Varied number of schemes with varied numbers of options.

63) Open-ended funds do not have a time frame for closing the fund.
1. TRUE
2. FALSE

64) Ownership of unit holders in Mutual Funds is-


1. Mutual
2. Beneficial
3. Mutual and Beneficial
4. None of the above

65) Gold funds invest in gold only.


1. TRUE
2. FALSE

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