Sub Module : Securities Market

2771 The NAV of a mutual fund is

 Always constant
 Keeps going up at a steady rate
 Fluctuates with market price movements
 Cannot go down
Answer : Fluctuates with market price movements

Sub Module : Securities Market

2772 The headquarters of the Securities and Exchange Board of India are in
______

 Mumbai
 Delhi
 Kolkata
 Chennai
Answer : Mumbai

Sub Module : Securities Market

2773 Which of the following committees is a SEBI committee?

 Financial standing committee

 Public accounts committee
 Mutual Fund Advisory committee
 Estimates committee
Answer : Mutual Fund Advisory committee

Sub Module : Securities Market

2774 Which of the following agencies conducts physical oversight of mutual

funds and depositories?

 Reserve Bank of India (RBI)

 Association of Mutual Funds in India (AMFI)
 Non Banking Financial Company (NBFC)
 Securities and Exchange Board of India (SEBI)
Answer : Securities and Exchange Board of India (SEBI)

Sub Module : Securities Market

2775 Money market provides

 Short term debt financing and investment

 Long term debt financing and investment
Answer : Short term debt financing and investment

Sub Module : Securities Market

2776 Which of the following is not a method of raising capital in primary

market

 Initial Public Offer (IPO)

 Rights issue
 Exchange Traded Market
 Private Placement
 Answer : Exchange Traded Market

Sub Module : Securities Market

2777 A gilt fund is a special type of fund that invests in

 Equity only
 Short term securities
 Instruments raised by companies with sound guidelines
 Government Securities only
Answer : Government Securities only

Sub Module : Securities Market

2778 Indian Depository Receipt (IDR) are issued by

 Foreign companies to Indian investors

 Indian companies to foreign investors
Answer : Foreign companies to Indian investors

Sub Module : Securities Market

2779 Which of the following is not a equity instrument

 Preference shares
 Equity warrants
 Convertible debentures
 Ordinary debentures
Answer : Ordinary debentures

Sub Module : Securities Market

2780 In a jointly held portfolio, the PAN and KYC process has to be complied
with by

 All the joint holders

 The first holder only
 Any one of the joint holders
 The second holder only
Answer : All the joint holders

Sub Module : Securities Market

2781 In the market order there is no need to specify the price at which a
trader wants to purchase or sell.

 TRUE
 FALSE
Answer : TRUE

Sub Module : Securities Market

2782 Trade with a minimum value of Rs. ______ executed through a single
transaction on the stock Exchange constitutes a 'Block Deal'

 5 Crore
 10 Crore
 15 Crore
 20 Crore
Answer : 10 Crore

Sub Module : Securities Market

2783 Mutual Fund agents/distributors are not allowed to sell Financial

Products other than Mutual Fund

 TRUE
 FALSE
Answer : FALSE

Sub Module : Financial Market

2784 NEFT stands for

 Nominal Expense Fund Trust

 National Efficiency Factoring Trust
 National Electronic Fund Transfer
 Nomination Effective For Trade
Answer : National Electronic Fund Transfer

Sub Module : Financial Market

2785 In the context of the financial industry, what does AMC stand for

 Annual Maintenance Contract

 Alternate Mechanism for Credit
 Asset Management Company
 Approved Merger Clause
Answer : Asset Management Company

Sub Module : Financial Market

2786 CIBIL caters to

 Consumer segment
 Commercial segment
 Both consumer and commercial segment
 Banks
Answer : Both consumer and commercial segment

Sub Module : Financial Market

2787 What is AMFI?

 Association of money and finance India

 Association of mutual funds in India
 Authorisation of mutual funds in India
 Authorisation of money and finance in India
Answer : Association of mutual funds in India

Sub Module : Financial Market

2788 SEBI does not provide a platform for _________?

 Stockbrokers
 Hedge fund investors
 Portfolio managers
 Investment advisors
Answer : Hedge fund investors

Sub Module : Financial Market

2789 What is the current rolling cycle under SEBI?

 T+3
 T+2
 T+1
 No limit
Answer : T+1

Sub Module : Financial Market

2790 The securities market and the commodities market is regulated by

 SEBI
 RBI
 IRDAI
 SBI
Answer : SEBI

Sub Module : Financial Market

2791 The Chairman of Securities and Exchange Board of India (SEBI) is

appointed by the

 RBI
 BSE
 NSE
 Ministry of Finance
Answer : Ministry of Finance

Sub Module : Financial Market

2792 What are the two kinds of brokers?

 Financial and margin brokers

 Discount and merchant brokers
 Trading and order brokers
 Present and asset brokers
Answer : Discount and merchant brokers

Sub Module : Financial Market

2793 Mutual Funds are managed by __________

 Limited liability company

 Private company limited by shares
 Unlimited company
 Asset management companies
Answer : Asset management companies

Sub Module : Financial Market

2794 How many companies are a part of Sensex (Stock Exchange Sensitive
Index)

 20
 30
 50
 100
Answer : 30

Sub Module : Financial Market

2795 The markets where securities instruments are traded directly between
buyer and seller are known as ______.

 Primary markets
 Secondary markets
 Tertiary markets
 None of the above
Answer : Primary markets

Sub Module : Financial Market

2796 NIFTY index fund is a type of

 Mutual Fund
 Indian Depository Receipt
 Exchange Traded Fund
 Warrant
Answer : Exchange Traded Fund

Sub Module : Securities Operations

2797 A contract between a buyer and a seller, entered on a particular date,

regarding a transaction that they will fulfil at a later date, is known as
______.

 Forward Contract
 Fixed Contract
 Derivative
 Future Contract
Answer : Future Contract

Sub Module : Securities Operations

2798 Which of these derivatives does not get traded in the Indian Stock
Exchanges?

 Forward rate agreements

 Index Options
 Stock Options
 Index Futures
Answer : Forward rate agreements

Sub Module : Securities Operations

2799 Any order that is generated using automated execution logic shall be
known as

 High Frequency Trading

 Algorithmic Trading
 Sigma Trading
 Zing Trading
Answer : Algorithmic Trading

Sub Module : Securities Operations

2800 Hedging risk for a short position is accomplished by

 Taking a long position

 Taking another short position
 Taking additional long and short positions in equal amounts
 None of the above
Answer : Taking a long position

Sub Module : Securities Operations

2801 A short contract requires that the investor

 Close out his position in the future

 Hedge in the future
 Buy securities in the future
 Sell securities in the future
Answer : Sell securities in the future

Sub Module : Securities Operations

2802 To say that the forward market lacks liquidity means that

 Future contracts usually result in losses

 Future contracts usually result in profits
 It may be difficult to make the transaction
 None of the above
Answer : It may be difficult to make the transaction

Sub Module : Securities Operations

2803 For equity segment, maximum brokerage that brokers can charge is
_____ % of the trade value

 0.01
 1.50 %
 0.02
 2.5 %
Answer : 2.5 %

Sub Module : Securities Operations

2804 Limit order aims to buy ___ the market price and sell ___ the market price

 Above & below

 Below & above
 Answer : Below & above

Sub Module : Securities Operations

2805 In trading, GTC stands for

 Good till cashed

 Good till caught
 Good till converted
 Good till cancelled
Answer : Good till cancelled

Sub Module : Securities Operations

2806 Securities Transaction Tax (STT) is levied on

 Only at purchase of securities

 Only at sale of securities
 Every purchase or sale of securities
 None of the above
Answer : Every purchase or sale of securities

Sub Module : Risk Management

2807 Which of the following statement is not true regarding Mark to Market
(MTM) margin ;

 MTM margin is collected or adjusted against the cash/cash equivalent component of the liquid
assets of the member

 The clearing corporation collects mark to market margin (MTM) from the member/broker
before the start of the trading of the next day

 The MTM margin is collected on the gross open position of the member
 MTM is not linked to closing price of the security at the end of trading
Answer : MTM is not linked to closing price of the security at the end of trading

Sub Module : Risk Management

2808 Risk containment measures includes which of the following:

 Checking Margin requirements

 Checking net worth of the client /investor
 Checking whether the order placed is genuine
 None of the above
Answer : Checking Margin requirements

Sub Module : Risk Management

2809 SPAN method of calculating margin requirement is for trades done

___________.

 On the Equities Segment

 On the Futures and Options Segment
 On Government Securities
 On Debentures
Answer : On the Futures and Options Segment

Sub Module : Risk Management

2810 State which of these statements is true?

 Call Option gives the buyer the right but not the obligation to sell the underlying asset
 Call Option gives the buyer the right but not the obligation to buy the underlying asset.
 Put Option gives the buyer the right but not the obligation to buy the underlying asset
 Answer : Call Option gives the buyer the right but not the obligation to buy the underlying
asset.

Sub Module : Risk Management

2811 Margin intended to cover the largest loss that can be encountered on
99% of the days is

 Mark to market (MTM) margin

 Collection Margin
 VaR Margin
 Margin
Answer : VaR Margin

Sub Module : Risk Management

2812 Which of the following statements is incorrect about the Securities

Exchange Board of India (SEBI)?

 It is a statutory body
 It was given statutory powers by an ordinance in 1992
 It is a non-statutory body
 None of the above
Answer : It is a non-statutory body

Sub Module : Risk Management

2813 Corporate action adjustments are done on all _____________ positions.

 Open
 Closed
 Past
 Executed
Answer : Open

Sub Module : Risk Management

2814 Which of the following might be a reason for a stock market to lose
value suddenly?

 A terrorist attack
 The bankruptcy of a big company
 Fear of a global recession
 All of the above
Answer : All of the above

Sub Module : Risk Management

2815 In case of declaration of ""extra-ordinary"" dividend by any company,

the total dividend amount would be ____________from all the strike prices
of the option contracts on that stock.

 Increased
 Reduced
Answer : Reduced

Sub Module : Risk Management

2816 The stock brokers are allowed to net the client account within the firm.
State whether True or False?

 TRUE
 FALSE
Answer : TRUE