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MF Question Paper - 4

The document discusses various aspects of mutual funds, including investor distributions, risks associated with short selling, and regulations governing mutual fund advertisements. It also covers topics such as the minimum number of investors required for a mutual fund scheme, benchmarks for debt mutual funds, and the Total Expense Ratio (TER). Additionally, it addresses the importance of investment objectives and the regulatory framework set by the Reserve Bank of India.

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Santanu Sarkar
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31 views9 pages

MF Question Paper - 4

The document discusses various aspects of mutual funds, including investor distributions, risks associated with short selling, and regulations governing mutual fund advertisements. It also covers topics such as the minimum number of investors required for a mutual fund scheme, benchmarks for debt mutual funds, and the Total Expense Ratio (TER). Additionally, it addresses the importance of investment objectives and the regulatory framework set by the Reserve Bank of India.

Uploaded by

Santanu Sarkar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF or read online on Scribd
Inwhich of the following options does an investor receive the distribution in hand? Incame Distouton cam capital wthrawal agen ony Ineame dstrbuten cam capt wihdrowal ervestnent lan ony Income Distibuton cum capa wtheraval open an income dsrbuten cum capital withdrawal reinvestment plan both Grow Y CORRECTANSWER Explanation Mest mt fun shams ter to opto incur Dsus eum capa whéawal and Growth the epten uhh post, is he Reverie neo Dutton ‘on cp wnarava) peor Ina owe option dient isnotacare. Terr, ehingis eve in the an count deni the TRUE statements with respect tothe iss associated with shor soling and stock lending. 1. There is counterparty risk and Tiquity rsk in short eng 2 There sno ak associated wit stock lending as the Vansaction fe done trough an approved intermediary ‘On sue (nig 2s tue Bath | and? ae te Y CORRECTANSWER Explanation: heranng the sla of sors or acres tht he sear das ot atthe neo rasing nated Ber om someane wha aay owns Lala he short ler buys ‘bce stecancuny ne sare tn ous ne texan te ese Ste Sareea ar are Sosa analy ak tne cs ng Brome. The seer being sor sole might eg or brome gud sa avrg he sacurty mg cu ota mush per pee vel than antes einge eses sacantes Lansing i tengo secures reg a appre intra 3 bare unde an sgreemnt ope paris wth te coniton athe Boone wi tn scenic secures ane Some ype sles tne ae oe specie prod isn mn ou tp bee sechang of te urureesbrrones Tare te ron err Scones ioc. Inuag tera tole tn er sar uch mre can enna pessibe onset Mgs ete Clle te malty oe Spproveswteeaay tem {mo sncureseoportes ye wnaut nee posi asc Corpora brats serge ‘Wich ofthe following is INCORRECT wih respect to advertisements of Mutual Funds by AMCS, "ie adveriernanis an va cabs for endrsamets ‘The adveriserents can sow pas perfomance ofthe schema ‘The adverbsmerts can show the retin numbers Alot te abo ate ncorect \¢ CORRECTANSWWER Explanation “Tactical Asset Allocation decisions ar based on whlch of those factors? Likely banavour fhe makes ‘Ae oe esto, (reef the este Aloft above “7 CORRECTANSWER Expianation set satan ton bran agin hn ymameaty. Te purpose at such an agprosch ao tke avanage fhe appetites presente by From the below mentioned eniues associated witha mutual fund, who hes to mendatoly conibute to the corpus ofthe mutual fund? “he Fusions The Custodians ‘The Asset Management Company ‘The Sponsors CORRECTANSWER Exploration ‘The mutil ners rete by ene a mc Sponser, re temain evens being te util ne buses. ‘ne spanarine prometrct tne mut td The sponse ings in cpt sh vaste 3 mu fn rn at up he AC, Enso makes an spleen foregone MU Tend and Cn at HOA of ene WrD a he AMC Im CHE Wore, evar MF neds 3 sponser Bore ean ce paso “The benchmark for a debt mutual fund scheme could be chosen on the bs “ine Fao CORRECTANSWER Explanation: scheme type and Chie ot mvetnant nvr rete cole of benchmark debt sha. of Scheme Type and Scheme Sie.- Slate whether True or Flee? For eg Lig schemes ivestin stcutes of p08 ays matuny, Thrtre, 3 sherrm monty mare PCAN Such as NSE'S BOR or CRIS. Ll Fund nce hole of vetmentUnvrse Git funds invest on in Goverment sears, Taro, ees bas on Goverment Secules ate serps. Det tne tat Invest ina wide Hat yar resus of tho mutual und ‘Schome irmaton Decunert (50) ‘Statement of Addon inrmaton (SAI) CORRECT ANSWER Explanation: patient Shane Cacumants—Ragstny proven Incase ot hang in tuners ana ints ot Regton sn ascend tthe stg SIO sll eke ane aplayecon AMC west immety Incase omer enarges in 1, he AMC sa be egure osu an acengum ane Sy te Same on 5 este mney. Which ofthese tunds wit generally havea higher fund management cost? Debt Fans Passio Eauly Fund ‘ctv Eaaty Fund uty indo Fund CORRECT ANSWER Explanation: In act Eguty Fun he ing manape oot 3 oto buying! lng which siti ght tansscton costs Alo ot ecasrch work gos not Soe coo tng management tretinvee uty ae unc oc ass Egy fangs vat 2 porolo hat mms 2 mat na, Ta ost rk nine ns ee fd maroon ln rng ‘Wich ofthese information i not contained in the Scheme Information Document (0)? Names of secuties nthe scheme’ portale Investment objcine ofthe scram \/ CORRECTANSWER Explanation” “Tre rameso secures nthe scheme’ porto Is conane nthe Fun fac sheet an notte 1. [Which one of these is an advantage of investing in Mutual Funds? 'Eceromes ofs0 Portotecusemszaten ‘Choice oveioad ‘both above \/ CORRECT ANSWER Explanation: {age vest ors os mutated est arouse aconomies ot rt. For intaton cos rsh ivestent esta ond oes spce gts spre sorons vei Firth the nghertnsactor vane mates pase to nepan buta rn tn bate Sears sna sea surrce ove to Ovrcnd Tae mi mal freeboard sara mun outs nem eptos win ew shames ch mabe He eee ‘dent the FALSE statements wit respect to benchmarks fr mutual fund schemes. A.A Mult-Cap fund can have Nit 00 index as its benchmark B. AMUI- (Cap fund can have BSE Sensex as ts benchmark Oniy Ais false ny Bs se Bath A and ete None the above Y. CORRECTANSWER Explanation: /AMutcap tun invests in Large Cap Mil Cap and Sa ap stock 9 par proportons spate by SEBL ‘The nysto nex represents top 00 arge cap comeanes, top 180 Mis-become a mutual fund distibutorin India, one has to pass an exam which Is conducted by ‘Scares and Exchange Boatd of iia SEB! "Natena Stock Exchange - NSE NCFN "atonal inside of Socuntes Markel ISH ‘Assocstion of Mutual Fun in India's AML \Y CORRECTANSWER Explanation: Datu neato pats he NGM creat Eaminaon(NSMCSers- VA: Mutal Fund Ditters (MF) Cereton Examine) ane eit wth AE, How often does a mutual und ‘Daly on fo mutual tnd wetste \Wieeky=on te mutval und webste ‘Once @ month intend Factsheet (Once a year when makes te mandatory dsclosues to SEB! and AMF foe the information on Tet Expense Ratio charge toa mutual und scheme and where is this published? ‘/ CORRECT ANSWER Exptaraton: 'SEBI as mancateg hate Asset Management Companies (NCS should prominent sist on 3 6 bal. te Tol expense a [Schemes ate Oa Shame Ue _}eepute beau eapense Roo sus una same on cane In india, he Mutut funds are conetted a Umted Company ‘en: Goverment Organon Self Reguisiory Omansations Tris ‘/ CORRECT ANSWER xptanaven: ata! ar constutc as Tes. Theoret ae govern byte nan Tut Act. 882 ‘Suresh sees that his ends are investing na fnance scheme whichis promising very high returns Scheme, Which bas fe Suresh exhioting? Hod entalty| Uses Averson Cnidence bias chonng Y CORRECTANSWER Explanation: In sehr france, Har Muraty ba fest vest tncney ofl and copy what he veto ae ing. Tey at rg nce by emotion se iatic ter thatby mo am reapansen sata “ne onan works agsnsinvestors itstein ha traci mats ‘Which isthe rt stop that a mutual fund distributor should tke in bulding« mutual und portfolio fr his investors? "He stud iste best pertrming turds othe investor select, He sted seth thancil goals he est He steud vost me emcurtm alqud fund and seta Systomatc Transfer Pann good eauty funds He stedd Ist 003 equ funds wth he nest expense rato or te meso Ta select CORRECTANSWER Explanation: “ne selection of mi tnd shane for an lavetr wi apa upon ow na tha teaver Ras am he nese. The bate coud be a nant go! te ening cana alta pa acta ous ug spn ttt anspor stn assis fe schan © hra av¥ wc Te ‘Tveraore te rat step st et te rani goats a proper benchmarc for balanced hybrid schema, “GRIST sd 75425. Consrvave index GRISILHyoad 25078 Aggressive Index CRISILHyord 60°50 Mader Index ¥ CORRECTANSWWER Explanation: CRIB Dende nee fornyan tne: aggressive Hype Fun ‘atacand CRIS My 480, Moderate ne Conservative Hye Fund RUS Hyd 7528. Conserate Ince CRIS Hyon 2578, aggresive nse 2 which ofthese ates wl the loekin’ in retirement fund be lower than the preserbed 6 years ? ‘Who the rerament agai earier than 5 yoas fom te dal of rwesiment \Whon the age ofthe nvestor atthe tra of maleng ital investment ot less than 60 years ‘When the targeted corpus is achieved belo 5 years lott ave. CORRECT ANSWER operand rtenent slon vented scheme having a loch of 6 yen tiettemect ae nbishwvets eien Scheme having lookin for at mast ‘eos ort rtrement ae whichever ate Long term capt gains Is NOT taxed In which of these funds? A, Balanced Advantage Funds B, Balanced Funds [Link] Funds fet Aen 8 ‘ni ‘nya (C3ptal gains rom al ypes of mutual funds 2 taxed subjoct cera condiens ‘7 CORRECTANSWER Explanation: Longe capa gains appeal for Keuty Furs a 12% and Non-equty rte funds(Equy Beene 8% #68 cf porto) a 2% wh ingen berets ‘2% nich expenses canbe charged by the AMC to a mutual fund scheme? ‘Expenses which are ered to manage he tnd [Expenses which are sed to launch the nd ‘Expanses which re nee by he ANC: Expenses which are incurred by he vestosin buying the urd <1 CORRECTANSWER Explanatcn: srs reenact tt Ay xp thr ann sy an sing aa ay ee mgt nay ‘Smita a young investor and her parents advice hero Invest in xed deposits of banks so that thee funds canbe used for er retirement If Smita follows her parents advice, what isk does she face?” ‘She has oslo te caret bank wien snc tong ‘hove ahah ike ut hr poo. Theres ark ofan rks ‘Tnet sno isk as eed deposts ave qu sae CORRECTANSWER Explanation: Fuad cape ves ve low rato tu and when aeuteg aginst infin te ret can somtimes be very owe ven negave. Ti wil not lp in bulling ha retirement conus ‘mists 2 ycung investor anc has pony ote her hand. So he shoud vest grow sock egy meting sherman hed post ‘Mr X has invested Re 20,000 n 370 ay FP andon maturity he received Re. 216,832, What ls the capital gan In his transaction? Rs. 7316 Rs. 15750 Re, 15802 Insuticet Data J CORRECTANSWER Explanation: ‘seme aoe gurston, capa gamis Rs 28802-20000 Rs. 1852 Mr. shan gives a local cheque at 230 pm of Re 30 lacs for investment in an Equity Scheme, Which wll be the applicable NAV for alotment of units to Me. Shah 2 NAY ofthe business day on which the funds te avalale for ulsston Closing NAY othe new tusness day ‘losng NAV o ay mmexstty preceding the dete of ppication ‘Same day NAV received below cut of ime, “Y CORRECTANSWER Explanation Ye 31 rear as septa 7, 2090, ss cece st wih espace pres of unt ot shames oth Db and Ey cA AGE nov shams lng elo spp on uch fae Se sabe for uasseon erp ote nana teen of uot Sepa ‘us now nvestrs ano gave aches fx blow Rs 260.00 ge ne same y's NA we hose puting mote get the NAY the ay wen te che na ee For which ofthese documents is Time Stamping manatony? Payment instimen cy ‘Appaton tam oly “ansactn sip fr buying adaonal nts Both or pation fom ansachon sip and payment astuneat Y CORRECTANSWER Explanation: igri man Yr a8 nancial wansactons in mut unds ie prchese redemption ee. The apt fom, he payment nswument ave to Be ne ae te leh of then investors wl ete for lower return "ANlederte investor ‘AConeansive nator ‘An Aggressive vector ‘an Acntious nvestar hlahe proters low evel of maha? \Y CORRECTANSWER Explanat ‘A conseiatv inter s someone whe wants is mony lo grow dows nt want this pip investment A Gerticate of Deposit issued bya bank wil be for ‘ Sdaysto2 Years ays 0 1 Year 450078 Ser Y CORRECTANSWER Explanation: ‘costs of epee a asssncane nani to tat i ovens by he Rasave Gan ns ae {eponters 2nd ne bom wherein the bane pays sh weston Your ves. tive na ceteris fom, Ki typeof greament ace between ne Caress of epost are esd by Banks far 7 5/210 yao by Financial stuns rt yar ‘A creditable benchmark ofa mutual fund heme should bei sync wth the invesimont Stalogy of ho schome ‘Asset allocation gate ofthe schemo Invest objocwo ofthe scneme Atte above Y CORRECTANSWER Explanation: ‘A tea bencnmar shows meet he totowing egutemants: shoud be sy wit) te investantobecve of te sche Le. he secures of arabes tat oi te ‘ils Teta bipartite stint pottoinpcnt hens nian oper) er este arn) neta ayo deny which of thse statements isare CORRECT? A. Investors can be categorized fame asset location in ther nvestinent portfolios B. Only after Considering te ndvidua risk prof, the asset allocation should be cone between Core portfolio and satelite pote. ‘Oy satomont Ais corect ny satoment 8 correct Bath silomons Aand 8 are cooct None oft sore 7 CORRECTANSWER Explanation ‘cea on investors portale shuld be evidea ito Coe ana Sate portoton. Te or porte wl be vested Sect 0 te lnm nec of nestor and the state rid lb nvetec othe soramge of apace shotterm mrt vere ows tne sion oetisen are and state pelos wl depend pon ach investors poe, Conseitv vest may ie vey em proportion of hal orl parte manapeststealy sna sn meet comtorane wt ahng hgh rat may nave av even Nghe expat fo ence nesta Dieree investors have eiarnt onan gol cern ae ees In act nvestrs te same age oup may 280 hve eieret gens. Tl Mane sustens may aso oA tse many titan gots ay pan fe wile fey att an ahaa succes, Ray oto rcer eager ens on as Get xcrange Tacos Fund (ETF) CORRECTANSWER Explanton Pose nce invstcn ttn 2 pacts ce won peormance cake tno Fee My cb ane ‘xiang Tad Fons fn en enctunges apa fs tyr mee wh entrench. se. om above opin, ny Gl tangs Nace Fun passe tun ‘Temain ocument whieh autores «company tinvstn a partes Fund scheme CORRECT ANSWER Explanation: ‘The transaction costae fow for investment in ral esata compared to other rani ases. tate wheter Tus False? “CORRECT ANSWER ‘Etanton ‘arenes ote tom tm ay rgeatn ee, rtrge ts highness ‘cone Se rerconisence ae ere meraty {CORRECT ANSWER Explanaon ‘ecincy Bak ne mpl eat rant on chon mating ean by 08 ‘he ett gannceovrae tale sion ming. Ft eam ee pes cages wl mate pope Bk ny Sout ba ae wen wold ad te (Ridin Sly mde ntcoee stench er anda eas non est nat oe 2) Sy shingle aoe wc oa aS ‘teratoma dey te us statement in rape omeaturing eu for Mtl Fande shames A, Conpoundea Annual Growth Rate CAGR Wchnigue hasbeen preaerbed by SE81 when vice patdondcompounng nfo be covaaeeaB: CAGR athe ecogied sans for alan eure for estment Kerzon st rater an orem year © simple etm on be acta ing te forma: Soe rics -ContPice Castes ‘nia wns arecorect Sapa a cone SA and Cae caret Explanation ‘ananve a ean pian ampounang be canine CACR Wega re reneMe td 2 Some ltrs y 8 2. meroumis neate ung CACR ew Nolin ped owe ya. rons es anon ye an Simo Ret ene Stsemen ot atonal tormation (SA) aso be res upted andth piton has tobe done by x Expiration: Upcson frame Dseunets— Repu reins ion 31 Ragdr pnb ey ant men ot a nel Maral change ve bese onan ensign ad wenn mabe ut of $0 questions 41 correct and 9 wrong.

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