You scored 84 points out of 100 points.

Number of Correct answers - 84

Number of Wrong answers - 16
Number of unanswered questions - 0

Your answers are shown below:

1. How much can a close-ended scheme invest in unlisted equity shares and equity
related instruments?

 5.00%
 10.00%correct
 15.00%
 20.00%
2. There are two approaches to financial planning, one is goal oriented. What is the other?

 Risk Financial Planning

 Objective Financial Planning
 Comprehensive Financial Planningcorrect
 Inclusive Financial Planning
3. If an investor gives a local cheque of Rs 4 crore for investment in Gilt scheme at 11.30
A.M. What NAV would be the applicable to this investment?

 The closing NAV of the day preceding the date of application

 The closing NAV of the next working day
 The closing NAV of the application day
 The NAV of the business day on which the funds are available for
utilization before the cut off time of that daycorrect
4. Which measure of risk is relevant only for debt schemes?

 Variance
 Beta
 Standard Deviation
 Modified Durationcorrect
5. A couple in seventies who has never invested in equity, now wishes to start an SIP of a
small amount in equity. Which category of scheme would you suggest?
 Sector Fund
 Thematic Fund
 Mid cap Fund
 Diversified Equity Fundcorrect
6. Why is Goal Oriented financial planning undertaken?

 To plan for all the needs an upcoming expenses of a person

 To evaluate particular investment options
 When a person has limited money, this is the most appropriate approach
 To find out how much money will be needed, when it will be needed to
achieve on particular goalcorrect
7. The stock exchanges which provide mutual fund trading facilities also have to provide
for settlement guarantee - State True or False?

 TRUE
 FALSEcorrect
8. A financial advisor recommends to an investor that he should have as much debt in his
portfolio as his age. Which type of asset allocation is he recommending to the investor?

 Strategiccorrect
 Tactical
9. Trail Commission payable by AMC to distributor is calculated on NAV of related
investment based on

 Yearly balances
 Quarterly balances
 Monthly balances
 Daily balancescorrect
10. Trustees are responsible to ensure all transaction entered into by AMC are in line with
___________________ and are compliant with related regulations.

 Scheme objectivescorrect
 SEBI Directives
 KYC Guidelines
 AMC mandate
11. A mutual Fund scheme can be formed to invest in Gold or Gold related instruments.

 TRUEcorrect
 FALSE
12. Which category of schemes would use 'CRISIL Composite Bond Fund Index [25%
allocation] + S&P BSE 200 (TRI) [75% allocation]' as their benchmark?
 Aggressive Hybrid Fundcorrect
 Balanced Hybrid Fund
 Conservative Hybrid Fundwrong
13. Which category of investors are worst affected by inflation risk?

 Young Unmarried with a Steady Job

 Married Couple with young children and both spouses earning
 Married Couple with Older Children, one spouse earning high salary
 Retired Personscorrect
14. What is the formula to calculate how much money will be needed in future after
considering the inflation?

 P = A × (1 + r)n
correct
 P = A × (1 - r)n

15. Under Systematic Withdrawal Plan, there is no implication of Exit Load or taxation.

 TRUE
 FALSEcorrect
16. An investor wants to invest in the investment option which carries least credit risk.
Which of the following options is least risky?

 The scheme has invested in Government Securitiescorrect

 The scheme has invested in AAA Rated Corporate Bonds.
 The scheme has invested in PSU Bonds.
 The scheme has invested in Bank CD.
17. Which measure of risk is used to identify total risk in an investment?

 Standard Deviationcorrect
 Modified Duration
 Variance
 Beta
18. An investor asks you to recommend him a scheme. He has money that he can invest
for 3 years. He is looking to invest in debt but would like higher returns and would like
something of an alternate to fixed deposit. Which type of scheme would you suggest?

 MIP
 FMPcorrect
 Dynamic Asset Allocation Fund
 Income Fund
 19. In a Mutual Fund, the Investor has to separately pay for the Professional Fund
Management services.

 TRUE
 FALSEcorrect
20. Where would be the risk of an Index Fund as per riskometer?

 Moderately Low
 Moderatewrong
 Moderately Highcorrect
 High
21. Can a distributor sell mutual fund product of distributor’s group/ associate/ affiliate?

 Yescorrect
 Nowrong
22. What are the standards laid down by AMFI to promote investor's interest called?

 AMFI's Code of Conduct

 AMFI's Code of Ethicscorrect
 AMFI's Guideline & Norms for Ethical Conduct
23. If investor already has a folio with the mutual fund, only __________needs to be
submitted with the requisite payment for investment purpose.

 PAN Number
 KYC Documents
 ARN
 Transaction Slipcorrect
24. Mutual fund pay taxes on their income at the rate of -

 0.05%
 0.50%
 1.00%
 NILcorrect
25. Which of the following is done through technical analysis?

 Mark to market
 book value analysis
 Profit analysis
 Volume & price behaviorcorrect
26. When the interest rate in the market rise, value of a debt security will _________ -
 Fallcorrect
 Increase
 Do not effect
27. Who manages the Pension Funds?

 Pension Fund Managerscorrect

 Mutual Fund Managers
 Treasury of the Employer
 Banks
28. Of the following four investment options, which is the most appropriate for a person
who obtains sudden wealth?

 Invest in Equity initially and then start an STP to debt

 Invest in Debt initially and then start an STP to equitycorrect
 Invest only in equity
 Invest only in debtwrong
29. When it comes to debt, longer the duration, more stable the returns. Correct or
incorrect?

 Correct
 Incorrectcorrect
30. Where the scheme has been in existence for less than _____ year, past performance
shall not be provided or advertised.

 Half
 Onecorrect
 Two
 Threewrong
31. indexation refers to Adjusting the Purchase Price of
the Fund considering the Inflation.

 TRUEcorrect
 False
32. What is the formula for calculation of real rate of return?

 Real Rate of Return = (1 + Nominal Rate)/(1 + Inflation Rate) - 1correct

 Real Rate of Return = (1 + Inflation Rate)/(1 + Nominal Rate) - 1
 Real Rate of Return = (Nominal Rate)/(1 + Inflation Rate) + 1
 Real Rate of Return = (Inflation Rate)/(1 + Nominal Rate) + 1
33. Risk of inflation, political turmoil and recession is systematic risk. True or False?
 TRUEcorrect
 FALSE
34. Illiquid securities exceeding 15% of total assets are to be valued at _____value :

 85%wrong
 75%
 50%
 Zerocorrect
35. The CUM - dividend NAV refers to the NAV on the date when trustee approves
dividend.

 TRUEcorrect
 FALSE
36. Which debt mutual fund schemes hold their value despite fluctuation in interest rates?

 Liquid Funds
 Income Fund
 Dynamic Bond Fund
 Floating Rate Fundcorrect
37. Which fund units must be listed in Stock Exchange?

 Credit risk funds

 Open ended funds
 close ended fundscorrect
 Sector funds
38. If the fund manager expects interest rates to fall where should he invest?

 Floating rate debt securities

 Fixed rate debt securities of short tenor
 Fixed rate debt securities of long tenorcorrect
 None of the above
39. If a Mutual Fund Scheme is profitable, the true worth of its units will____.

 Decrease
 Remain the same as its face value
 Increasecorrect
 Not be impacted
40. Which factor should a person check while investing in a non-gilt debt scheme?

 Coupon Rate of Securitieswrong

 Sector Concentration of the Schemecorrect
 Share Price Movement
 None of the above
41. Which issuing authority issues debenture?

 Banks and Financial Institutions

 Private Sector Companiescorrect
 Public Sector Companies
 Reserve Bank of India
42. An Investment Management Agreement is to be executed between:

 The Trustees and the AMCcorrect

 The AMC and the Distributors
 The Trustees and the Sponsors
 The Sponsors and the AMC
43. When will a company pay high dividend yield?

 High dividend payout

 Low Market Price of Share
 Both the abovecorrect
 None of the above
44. The difference between the NAV and the Re-purchase price is termed as

 Entry load
 Redemption
 Exit loadcorrect
 None of these
45. Which asset class has the least transparency and standardization when it comes to
determining price?

 Gold
 Real Estatecorrect
 Mutual Funds
 Shares
46. What is required to form the basis of appointment of a mutual fund distributor:

 Approval from SEBI

 Power of Attorney from AMC
 Agreement between AMC and Distributorcorrect
 Agreement between AMFI and Distributorwrong
47. How long can SEBI take to offer suggestions on Offer Document?
 11 dayswrong
 21 dayscorrect
 31 days
 90 days
48. Which credit rating means lowest credit risk?

 AAAcorrect
 AA
 A
49. What would be the AUM of the scheme at the time of its first launch

 nilcorrect
 Rs 1,00,000
 10,00,000
 5,00,000
50. What does STT stand for?

 Service and trade tax.

 Security transaction tracking.
 Security Transaction [Link]
 None of these.
51. Mutual Funds help generate employment and also help enhancement in economic
development.

 TRUEcorrect
 FALSE
52. Mark to Market would mean that:

 Net assets are shown at historical values

 Net assets are shown at face values
 Each security is valued at its current market pricecorrect
 Securities are not to be valued at all
53. Which category of mutual fund schemes are permitted under Section 80C of the
Income Tax Act provided new regime of lower tax slabs is not opted for?

 ELSScorrect
 MIP
 Diversified Large Cap Fund
 Dynamic Bond Fund
54. Fund running expenses tend to be_______in case of Actively managed funds:
 Highercorrect
 Lower
 At par
 None of the above
55. Which type of schemes are subject to the risk of large fluctuation in net assets on
account of heavy repurchase?

 Open-ended schemescorrect
 Close-ended schemes
56. A scheme invests in Government securities of 2 year tenor. Which index is the most
suitable?

 Si-Bexcorrect
 Mi-Bexwrong
 Li-Bex
57. Stock Exchange brokers having experience over 10 years can distribute the mutual
fund units without passing any certification exam.

 TRUE
 FALSEcorrect
58. Once the asset allocation is decided---------------- can help us to select the good debt
and equity Schemes.

 PE Ratio
 Sharp Ratiocorrect
 Beta
 SDwrong
59. Asset management companies pay _____________ to agents in successive years until
the investment is withdrawn.

 Initial Commission
 Trail commissioncorrect
 Upfront commission
 No commission
60. If the investor wants to take low risk and earn only interest income from a debt
scheme, where should he invest?

 Long maturity debt Fund

 Short maturity debt fundcorrect
61. What does NISM stand for :

 New India Stocks Market

 National Institute of Securities Marketcorrect
 National India Securities Market
 National Institute of Stocks Market
62. Out of the following two investment options, which one is better to handle inflation
risk?

 Debentures
 Equity Investmentscorrect
63. KIM contains key points of Offer Document as it is basically a summary of SID and
SAI. True or False?

 TRUEcorrect
 FALSE
64. What is relevant while deciding which benchmark should be chosen for an equity
scheme?

 Scheme Type
 Choice of Investment Universewrong
 Choice of Portfolio Concentration
 All of the abovecorrect
65. As per SEBI, which returns should be considered to check the performance of a
scheme over the years?

 Simple Return
 Compounded Return
 Compounded Annual Growth Rate Returncorrect
 Annualised Return
66. DDT stands for

 Dividend distribution Taxcorrect

 Direct dividend tax
 Demand draft transaction
 None of these
67. __________ leads to creation of bubble in the market because the investors enter
when the market is already overheated.

 Recency Biaswrong
 Familiarity Bias
 Herd Mentalitycorrect
 Choice Paralysis
68. For making Investment in Exchange Traded Funds (ETF) Units, opening of a Demat
account is mandatory:
 TRUEcorrect
 FALSE
69. Legally, is SAI part of SID?

 Yescorrect
 No
70. If an investor wants to invest in gold for long term in financial form, which option will
be more suitable?

 Physical gold
 Gold ETFcorrect
71. Passive funds charge higher expense ratio because the fund manager aims at beating
the benchmark. True or False?

 TRUE
 FALSEcorrect
72. It is mandatory for an Asset management Company to appoint a Registrar & Transfer
Agent (RTA) to maintain the record of Unit Holders.

 TRUE
 FALSEcorrect
73. Investors subscribe to a particular Mutual Fund scheme which conforms to objective
and need____________.

 Of the Mutual Fund

 Of AMC
 Of their owncorrect
 Of no one
74. A minimum of ______of the directors on the Board of AMC should be independent
directors i.e. not associated with sponsor or its subsidiaries or trustees :

 75%wrong
 25%
 50%correct
 10%
75. Which type of scheme can own higher percentage of illiquid assets?

 Open ended scheme

 Close ended schemecorrect
76. The auditor appointed for audit of fund scheme will need to be different from the
auditor of AMC.
 TRUEcorrect
 FALSE
77. What is credit spread?

 Difference between the yield of Treasury Bill and any other debt security
 Difference between the yield of two debt securities
 Difference between the yield of Gilt and other non-Government
securitycorrect
78. The P/E ratio is an important measure of -

 a company's past performancewrong

 a company's anticipated performancecorrect
 a company's financial policies
 None of these
79. How much can be invested in equity-oriented securities under Government model of
NPS?

 5%wrong
 10%
 15%correct
 20%
80. The elementry feature of Sector Fund is that it invests in different Stocks of various
sectors.

 TRUE
 FALSEcorrect
81. Which type of mutual fund scheme would have an investment objective like 'To
generate income by investing predominantly in a wide range of debt and money market
securities'

 Diversified Equity
 Diversified Debtcorrect
 Balanced
 None of the above
82. If an Indian investor has invested in an International Equity Fund of America, what will
be the impact of strengthening of dollar?

 Investment Value in rupee terms will risecorrect

 Investment Value in rupee terms will fall
 No impact
83. ASBA is the abbreviated form of :
 As soon as blocked application
 Application Supported by blocked amountcorrect
 Agent supported by Association
 None of the above
84. All funds other than equity funds are treated as debt fund for the purpose of taxation.

 TRUEcorrect
 FALSE
85. Which of the following statements is correct?

 Asset allocation is done to minimize riskcorrect

 Asset allocation is done to time the market
 Asset allocation is done to maximize returns
86. Indian Mutual Funds are allowed to invest in Real Estate Assets.

 TRUEcorrect
 FALSE
87. Mutual Funds are Governed as per the provisions of Indian Trusts Act since they are
constituted as Trusts.

 TRUEcorrect
 FALSE
88. Mutual Funds only need to follow the regulations laid down by SEBI. True or False?

 TRUE
 FALSEcorrect
89. A new mutual fund scheme is launched through -

 New Scheme Offer

 New Fund Offercorrect
 New Mutual Fund Offer
 Offer of Mutual Fund Scheme
90. The NAV of units gets proportionately increased post bonus issue.

 TRUE
 FALSEcorrect
91. Transfer of security from one scheme to another scheme is not allowed in MF

 TRUE
 Falsecorrect
 92. Which type of mutual fund scheme buys and sells the same security at the same time
in different markets and takes advantage of price difference?

 MIP
 Arbitrage Fundcorrect
 Dynamic Asset Allocation Fund
 Quant Fund
93. If the cost of medical education is Rs 20 lakhs as per todays value. Which formula will
be used to calculate the cost of medical education after 8 years.

 future cost = Present cost x (1 + inflation) correct

n

 future cost = Present cost / (1 + inflation)

n

 future cost = Present cost x (1 - inflation)

n

 none of these
94. Conservative Hybrid Fund is basically an equity scheme with only a small proportion
of debt and large proportion of equity. True or False?

 TRUE
 FALSEcorrect
95. After a long recession, the equity market has started to rise. Mr. Khan has withdrawn
money from Fixed Deposit to purchase a house, but the final payment has to be made
after 2 months. Where should he invest the money?

 Diversified Equity Scheme

 Sector Funds
 Liquid Fundscorrect
 Ultra Short Term Funds
96. Under which situation will a fund manager keep scheme's funds in liquid form?

 When liquid schemes are performing well

 When there is upcoming dividend paymentcorrect
 Diversification strategy by keeping money different asset class
 To earn higher return
97. What is the use of core portfolio?

 To take advantage of long term opportunitiescorrect

 To take advantage of short term opportunities
 To invest in sector funds and mid-cap funds
 To invest in long term debt funds
98. For Debt Schemes, a unit holding period of less than 12 months is called short term
and unit holding period of 12 months and above is called long term. True or False?

 TRUE
 FALSEcorrect
99. How is PE Ratio calculated?

 Net Profit After Tax / No. of Equity Shares Outstanding

 Market Price of Shares / Growth in Earnings
 Market Price of Shares / Earnings Per Sharecorrect
 Market Price of Shares / Book Value Per Share
100. Which of the following is not contained in KIM?

 Loads and Expenses

 Measures OF Risk like Risk-adjusted Returnscorrect
 Dividend Policy
 Contact Information of Registrar for Investor Grievance

You scored 82 points out of 100 points.

Number of Correct answers - 82

Number of Wrong answers - 18
Number of unanswered questions - 0

Your answers are shown below:

1. The auditor appointed to audit the scheme accounts has to be the same as the auditor
of the AMC accounts.

 TRUE
 FALSEcorrect
2. Role of Credit rating agencies is highest in debt funds.

 TRUEcorrect
 FALSE
3. What does CAPM stand for?

 Current Asset Price Model

 Capital Asset Pricing Mechanism
 Cash Asset Pricing Mechanism
 Capital Asset Pricing Modelcorrect
4. All Mutual Fund Trusts have beneficiaries.

 TRUEcorrect
 FALSE
5. Which security has lower price risk because of fluctuation in NAV - Bonds or Liquid?

 Liquidcorrect
 Bond
6. Fixed Maturity Plans align the maturity of their portfolio to the maturity of the scheme.
Correct or incorrect?

 Correctcorrect
 Incorrect
7. What is required to form the basis of appointment of a mutual fund distributor:

 Approval from SEBI

 Power of Attorney from AMC
 Agreement between AMC and Distributorcorrect
 Agreement between AMFI and Distributor
8. Which document should an investor refer to make an informed investment decision?

 FactSheet
 Offer Documentcorrect
9. NAV applicable for processing a mutual fund transaction depends on ________ .

 Type of scheme
 Day of transaction
 The time of transaction
 All of the abovecorrect
10. Which measure of risk compares the fluctuation in periodic returns of the scheme with
its own average return?

 Variancewrong
 Standard Deviation
 None of the above
 Both a and bcorrect
11. Investors do not have the option to invest directly without routing the investment
through distributors under Direct plan.
 TRUE
 FALSEcorrect
12. Which of the following expenses can be charged to the scheme?

 Penalties and fines for law violation

 Fees of service providers and distributor commission & advt. expenses
 Expenses incurred for account statements, communication, dividend etc
 b and c bothcorrect
13. For calculation of distributable reserve for dividend distribution, following will not be
considered:

 Valuation Gainscorrect
 Valuation Losses
 Accrued Income
 Accrued Expenses
14. According to Certified Financial Planner - Board of Standards, the last stage of
financial planning is -

 Implementing the financial planning recommendations

 Analyzing and evaluating client's financial status
 Monitoring the financial planning recommendationscorrect
 Developing and presenting financial planning recommendations and/or
alternatives
15. Under which situation will a fund manager keep scheme's funds in liquid form?

 When liquid schemes are performing well

 When there is upcoming dividend paymentcorrect
 Diversification strategy by keeping money different asset class
 To earn higher return
16. To which variant of index are the mutual fund schemes benchmarked?

 Price Return variant of Index (PRI)

 Total Return variant of Index (TRI)correct
17. What is the formula to calculate how much money will be needed in future after
considering the inflation?

 P = A × (1 + r)n
correct
 P = A × (1 - r)n
 18. A conservative investor wants to invest in equity for the first time. His objective is to
have some equity schemes to counter balance the effect of inflation. Which type of funds
would you suggest?

 Active Funds
 Passive Fundscorrect
19. A married couple with young children wants to start a retirement fund. Where should
they invest money?

 Equitycorrect
 Debt
 Balanced Fundswrong
20. Who carries out credit rating of the securities in which mutual fund schemes invest?

 AMFI
 RBI
 SEBI
 None of the abovecorrect
21. Stock Exchange brokers having experience over 10 years can distribute the mutual
fund units without passing any certification exam.

 TRUE
 FALSEcorrect
22. A distributor is not liable for the acts and defaults of its agents/ sub brokers:

 TRUE
 FALSEcorrect
23. Which portfolio is best suited for a single income family with children who have not
settled?

 75% - Diversified Equity, 5% - Index Fund, 5% - Gold ETF, 5% - Diversified

Debt, 10% - Liquid Scheme
 35% - Diversified Equity, 50% - Index Fund, 5% - Gold ETF, 5% -
Diversified Debt, 5% - Liquid Scheme
 35% - Diversified Equity, 10% - Index Fund, 15% - Gold ETF, 30% -
Diversified Debt, 10% - Liquid Schemecorrect
 5% - Diversified Equity, 10% - Index Fund, 15% - Gold ETF, 35% -
Diversified Debt, 35% - Liquid Scheme
24. Change in the value of NAV is --------------------- .

 systematic riskwrong
 standard riskcorrect
 listed risk
 unsystematic risk
25. G-Secs are guaranteed by Government, hence, they are not prone to fluctuation in
value like non-Government securities. Correct or incorrect?

 Correct
 Incorrectcorrect
26. Mutual Funds are Governed as per the provisions of Indian Trusts Act since they are
constituted as Trusts.

 TRUEcorrect
 FALSE
27. Which of the following is not a reason to invest money in International Equity Funds?

 To earn attractive overall returns from international equity market and

exchange movement
 To remit money to relatives living abroadcorrect
 Asset allocation and diversification
 To tap an opportunity in international markets
28. Mutual Funds help generate employment and also help enhancement in economic
development.

 TRUEcorrect
 FALSE
29. What affects the choice of benchmark of a debt scheme?

 Scheme Typecorrect
 Credit Rating of Securities
 Sector Concentration
 None of the above
30. Which factors lead to difference between scheme returns and investor returns?

 Exit Load
 Additional Investment
 Part Redemption
 All of the abovecorrect
31. Where are product labels of a mutual fund scheme placed?

 KIM
 SID
 Mutual Fund advertisements
 All of the abovecorrect
32. The Custodian of a Mutual Fund is responsible for Acceptance and delivery of
securities for the purposes of sale/purchase transactions of various schemes of the Fund:

 TRUEcorrect
 FALSE
33. The market has been experiencing a bull run and pharma sector has performed very
well. A critical legislation is pending in the parliament, which if passed will lead to fall in
the price of stocks of pharma sector. An investor has checked the 1-year, 3-year
performance of the sector and is confident that sector will give good returns in the future.
Which bias is the investor exhibiting?

 Confidence Bias
 Familiarity Bias
 Herd Mentality
 Recency Biascorrect
34. Credit Risk Funds Schemes invest in securities with ____ credit ratings and______
interest rates.

 High, Low
 Low, Highcorrect
 High, High
 Low, Low
35. If an Indian investor has invested in an International Equity Fund of America, what will
be the impact of strengthening of dollar?

 Investment Value in rupee terms will risecorrect

 Investment Value in rupee terms will fall
 No impact
36. Mutual funds are not liable to pay taxes on their income.

 TRUEcorrect
 FALSE
37. Which type of schemes are subject to the risk of large fluctuation in net assets on
account of heavy repurchase?

 Open-ended schemescorrect
 Close-ended schemes
38. Capital Protection Schemes are ____________schemes with an objective of protecting
the capital irrespective of market fluctuations.

 Open ended
 Close endedcorrect
 Guaranteed
 None of the above
39. SIP investment can be done through -

 Post dated cheques

 ECS
 Standing instruction
 All the abovecorrect
40. Which funds perform better during a downturn in the economy?

 Growthwrong
 Valuecorrect
41. Asset management companies pay _____________ to agents in successive years until
the investment is withdrawn.

 Initial Commission
 Trail commissioncorrect
 Upfront commission
 No commission
42. Which among the following suitably defines the Risk -

 Asset classwrong
 scheme expences
 exit load
 Financial losscorrect
43. Which of the following is an SRO ?

 AMFIwrong
 SEBI
 NSEcorrect
 RBI
44. What is the Price to Book Value if - Net Worth =Rs. 25 Crore, Number of Equity Shares
Outstanding = 10 Lakhs, Market Price of a Share = Rs. 1,250?

 4
 5correct
 6
 7
45. Mutual Funds generally have access to ______funds collected from a
_________number of investors. Fill the blanks.
 Small, Largewrong
 Large, Small
 Large, Largecorrect
 Small, Small
46. Fluctuations in returns of a security does not make it riskier than any other security if
over a long period the average returns of both are same. Correct or incorrect?

 Correct
 incorrectcorrect
47. _______________ contains details of a particular scheme?

 Scheme Investment Documentwrong

 Statement of Asset Information
 Scheme Information Documentcorrect
 Statement of Additional Information
48. Real estate prices rise when the economy is unstable. True or False?

 TRUE
 FALSEcorrect
49. Schemes with an investment objective of regular income generation which invest in
securities like Government Securities, Treasury Bills, Bonds and Debentures are called
Equity scheme.

 TRUE
 FALSEcorrect
50. Any Mutual Fund scheme having _______percentage of its total portfolio in equity
securities is referred to as equity fund for the purpose of Taxation:

 Less than 50
 More than 50
 65 or morecorrect
 85 or more
51. What should be the minimum contribution of a sponsor in an AMC

 50.00%
 75.00%
 40.00%correct
 not specifiedwrong
52. What is the maximum limit of investment in asset class A of NPS?

 5%correct
 10%
 15%
 20%
53. Which of the following pair is not correct?

 IFA - Independent financial advisors

 ARN - AMFI registration number
 KYD - Know your distributor
 AMFI - Associated Mutual Funds Institutecorrect
54. Re-purchase price can be determined by ___________exit load from the effective NAV.

 Adding
 Subtractingcorrect
 Multiplying
 Dividing
55. Advertisements regarding Mutual Fund schemes shall not contain statements which
directly or by implication or by omission may mislead the investor - State True or False ?

 TRUEcorrect
 FALSE
56. What kind of mutual fund scheme is an MIP?

 Debt-oriented Hybridcorrect
 Equity-oriented Hybrid
 Debt Fund
 Equity Fund
57. Which index would be most suitable for a short term money market scheme?

 NSE's MIBORcorrect
 ICICI's Si-Bex
 S&P BSE India Sovereign Bond Index
 None of the above
58. For formation of a Mutual Fund Trust, a Trust Deed is to be executed between the:

 Trustees and the Beneficiaries

 Trustees and the Sponsorscorrect
 Sponsors and the Beneficiaries
 Sponsors and the AMC
59. A non traded or thinly traded equity instrument can not be valued using the
capitalisation of earnings method
 TRUEcorrect
 FALSE
60. Who is responsible for selection of stocks and securities in a mutual fund scheme?

 Chief Executive Officer

 Chief Finance Officer
 Fund Managercorrect
61. An Indian Citizen having attained an age of ____ Years is eligible to invest in any
Mutual Funds Scheme:

 21
 18correct
 25
 None of thesewrong
62. If there is no entry load, sale price of MF Units will be_________ the NAV of the
scheme:

 Higher than
 Equal tocorrect
 Lower than
 Both a and b are correct
63. Which category of mutual fund schemes are permitted under Section 80C of the
Income Tax Act provided new regime of lower tax slabs is not opted for?

 ELSScorrect
 MIP
 Diversified Large Cap Fund
 Dynamic Bond Fund
64. Which type of investment performs the best when there is financial or political
turmoil?

 Equity
 Debt
 Real Estate
 Goldcorrect
65. In a Mutual Fund, the Investor has to separately pay for the Professional Fund
Management services.

 TRUE
 FALSEcorrect
66. Who is responsible for the information available in OD?
 Custodian
 Distributors
 AMCcorrect
 Trustees
67. Which statement is correct

 Cut-off time are prescribed by AMC

 Cut-off time are prescribedby R&T
 Cut-off time are prescribed by AMFIwrong
 Cut-off time are prescribed by SEBIcorrect
68. A financial advisor recommends to an investor that he should have as much debt in
his portfolio as his age. Which type of asset allocation is he recommending to the
investor?

 Strategiccorrect
 Tactical
69. How much can a close-ended scheme invest in unlisted equity shares and equity
related instruments?

 5.00%
 10.00%correct
 15.00%
 20.00%
70. The investor must get his PRAN changed within 6 months of changing his employer.
True or False?

 TRUE
 FALSEcorrect
71. Generally Five star rating/ AAA rating of a fund indicates

 excellent portfoliowrong
 Low expense ratio
 Highest performancecorrect
 Low exit load
72. If a mutual fund distributor has offices in at least _________ locations, he will qualify
for due diligence review process.

 10wrong
 20correct
 25
 50
 73. Debt Schemes paying dividends to its unit holders are not liable to pay Dividend
Distribution Tax.

 TRUEcorrect
 FALSE
74. If the investor wants to take low risk and earn only interest income from a debt
scheme, where should he invest?

 Long maturity debt Fund

 Short maturity debt fundcorrect
75. What is the key factor that determines returns in debt mutual fund schemes?

 Stock Selection
 Interest Rate Forecastcorrect
 Sector Selection
 None of the above
76. As per SEBI, which returns should be considered to check the performance of a
scheme over the years?

 Simple Return
 Compounded Return
 Compounded Annual Growth Rate Returncorrect
 Annualised Return
77. SEBI has made regulations about the outside liabilities of mutual fund schemes.
Which of the following is False?

 Scheme can borrow only up to 25 percent of its net assetscorrect

 Scheme cannot borrow for more than 6 monthswrong
78. When will a company pay high dividend yield?

 High dividend payout

 Low Market Price of Share
 Both the abovecorrect
 None of the above
79. A scheme can distribute dividend on its realised profit.

 TRUEcorrect
 False
80. Why are risk profiling tools still not an alternative to a good financial planner?

 There are many tools on internet with different levels of robustness.

 Some tools require investor to guess the answer which is not a correct
approach.
 Investor might not be truthful in his answer.
 All of the abovecorrect
81. In case of Money Market, cash or Liquid schemes, performance can be advertised by
simple annualization of yield if performance is available for at least

 5, 15 and 30 days
 7,15 and 60 days
 7,15 and 30 dayscorrect
 One yearwrong
82. Open-ended schemes give the fund manager freedom to invest in stocks that will take
some time to give returns or which are relatively illiquid but have good prospects. True or
False?

 TRUE
 FALSEcorrect
83. An intermediary has laid down internal code of conduct and appointed a Compliance
Officer. An employee of his sends a market related rumour to the clients of the
intermediary. Who is responsible?

 Employee
 Compliance Officer
 None of these
 Both A and Bcorrect
84. More than 50 percent of the wealth of Indians is held in financial assets.

 TRUE
 FALSEcorrect
85. There are two approaches to financial planning. Both have stages. Which type of
planning has these stages - childhood, young unmarried, young married, married with
children, etc?

 Life Cycle Approachcorrect

 Wealth Cycle Approach
86. Which document contains information about Sponsors, AMC and Trustee Company?

 SID
 SAIcorrect
87. What does modified duration of security indicate?

 Tenor of the security

 Credit risk of the security
 how much will the value of a debt security fluctuate in response to
change in interest ratecorrect
 None of the above
88. Transaction charges on SIP are applicable if

 Committed investment is less than Rs. 10000

 Committed investment is equal to or more than Rs. 10000correct
 Committed investment is more than Rs. 10000wrong
 Not applicable at all
89. Trustee of one Mutual Fund is also eligible to become trustee of any other mutual
fund.

 TRUE
 FALSEcorrect
90. A Mutual Fund can be constituted only as a Trust.

 TRUEcorrect
 FALSE
91. Implementation of Uniform KYC is the responsibility of the Depository participants.

 TRUE
 FALSEcorrect
92. Some Mutual Funds these days give an option to investor so that by setting a Trigger,
an investor can transfer money into an equity scheme when market goes down by a
specified percentage.

 TRUEcorrect
 FALSE
93. A married couple with young children wants to purchase a house in the next three
years. Where should they invest money?

 Equity
 Debtcorrect
 Balanced Fundswrong
94. What are the two categories under which customer client relationship and
transactions be categorized?

 Advisory, Executioncorrect
 Financial Planning, Advisory
 Risk Planning, Advisor
 95. A portfolio has Beta of more than 1. What does that mean?

 Portfolio is riskier than the marketcorrect

 Portfolio is less risky than the market
 Portfolio has the same risk as the market
96. Which category of schemes would use 'CRISIL Composite Bond Fund Index [25%
allocation] + S&P BSE 200 (TRI) [75% allocation]' as their benchmark?

 Aggressive Hybrid Fundcorrect

 Balanced Hybrid Fund
 Conservative Hybrid Fundwrong
97. Who regulates the National Pension System?

 IRDA
 SEBI
 PFRDAcorrect
 AMFI
98. The New Pension scheme is regulated by IRDA and PFRDA both because it has an
insurance component also?

 TRUE
 FALSEcorrect
99. Which of the following statements is correct?

 Asset allocation is done to minimize riskcorrect

 Asset allocation is done to time the market
 Asset allocation is done to maximize returns
100. Which scheme closely tracks the price of gold?

 Gold sector fund

 Gold ETF correct
 You scored 78 points out of 100 points.

Number of Correct answers - 78

Number of Wrong answers - 22
Number of unanswered questions - 0

Your answers are shown below:

1. In a Mutual Fund, The sponsors need to appoint at least ____Trustees or can appoint
a Trustee Company with at least ____Directors on its Board.

 Five, Fourwrong
 Four, Five
 Four, Fourcorrect
 Five, Five

2. Which issuing authority issues debenture?

 Banks and Financial Institutions

 Private Sector Companiescorrect
 Public Sector Companies
 Reserve Bank of India

3. Mutual funds can hedge their portfolio on weighted average modified duration basis
by investing in Interest Rate Futures (IFRs). Correct or Incorrect?

 Correctcorrect
 Incorrect

4. Which measure of risk compares the fluctuation in periodic returns of the scheme
with its own average return?

 Variancewrong
 Standard Deviation
 None of the above
 Both a and bcorrect

5. A portfolio is less risky than the market, when -

 Beta is less than 1correct

 Beta is more than 1wrong
 Beta equals to 1

6. What is the portfolio turnover ratio if value of securities purchased is Rs. 8,000
Crore, value of securities sold is Rs. 4,000 Crore and the size of net assets is Rs. 10,000
Crore ?

 1.2correct
 0.4
 0.8
 None of the above

7. Of the following four investment options, which is the most appropriate for a person
who obtains sudden wealth?

 Invest in Equity initially and then start an STP to debt

 Invest in Debt initially and then start an STP to equitycorrect
 Invest only in equity
 Invest only in debtwrong

8. The access of demat facility for mutual fund investor has ________with NSE and BSE
providing screen-based platform for transactions in mutual fund schemes:

 Increasedcorrect
 Decreased

9. As a structured approach to decision making, following four decisions have to taken

in a sequence. Which is the last decision?

 Selecting a scheme category

 Selecting the asset class
 Selecting the right option within a schemecorrect
 Selecting a particular scheme

10. Risk profiling tools should not be used because they reduce investor confidence and
mislead them. True or False?

 TRUE
 FALSEcorrect

11. Implementation of Uniform KYC is the responsibility of the Depository participants.

 TRUEwrong
 FALSEcorrect

12. Out of the following two investment options, which one is better to handle inflation
risk?
 Debentures
 Equity Investmentscorrect

13. If the fund manager expects interest rates to fall where should he invest?

 Floating rate debt securities

 Fixed rate debt securities of short tenor
 Fixed rate debt securities of long tenorcorrect
 None of the above

14. What is the basic assumption of CAGR?

 Dividend will be paid to the investor

 Dividend will be invested at ex-dividend NAVcorrect
 Dividend will be invested at cum-dividend NAVwrong

15. A minimum of ______of the directors on the Board of AMC should be independent
directors i.e. not associated with sponsor or its subsidiaries or trustees :

 75%wrong
 25%
 50%correct
 10%

16. Capital Protection Schemes are ____________schemes with an objective of

protecting the capital irrespective of market fluctuations.

 Open ended
 Close endedcorrect
 Guaranteed
 None of the above

17. An investor who wants to invest in foreign markets, he should invest in –

 International Fundscorrect
 Arbitrage Funds
 Large Cap Funds
 Mid Cap Funds

18. While calculating profits, all the expenses that relate to a period need to be
considered, irrespective of whether or not the expense has been paid. This principal is
referred to as?

 Accrual systemcorrect
 Legal entity system
 Double entry system
 None of the above
 19. Under which investment style will the investor buy stocks which are priced lower
than their intrinsic value?

 Growth
 Valuecorrect

20. Under Systematic Investment Plan, Investors can book SIPs by investing through
Post dated cheques (PDCs).

 TRUEcorrect
 FALSE

21. Which portfolio is used to take advantage of short term opportunities in the market?

 Core Portfolio
 Satellite Portfoliocorrect

22. When money market instruments and debt securities with residual maturity of up to
60 days are not traded on a particular day, they shall be valued on __________.

 Yield Matrix basis

 Capitalisation of earnings basis
 Amortization basiscorrect
 None of the above

23. Who is primarily responsible to create awareness about mutual funds?

 AMFIcorrect
 SEBI
 Asset Management Companies
 Mutual Fund Distributorswrong

24. Which measure of risk measures the sensitivity of value of debt security to change in
interest rate?

 Weighted Average Maturity

 Modified Durationcorrect
 Credit Rating

25. The CUM - dividend NAV refers to the NAV on the date when trustee approves
dividend.

 TRUEcorrect
 FALSEwrong

26. SIP investment can be done through -

 Post dated cheques
 ECS
 Standing instruction
 All the abovecorrect

27. Which of the following is the best route for an investor if he wants to invest in the
shares of gold mining and processing companies?

 Gold ETF
 Gold Sector Fundscorrect
 Gold Future Contract
 Gold Deposit Scheme

28. Which measure of risk is relevant only for debt schemes?

 Variance
 Beta
 Standard Deviation
 Modified Durationcorrect

29. What is the maximum upfront commission limit paid by an AMC to the distributor?

 0.10%
 0.50%
 0.05%
 NILcorrect

30. What is the process of identifying investor's risks appetite called?

 Risk Identifying
 Risk Profilingcorrect
 Risk Assurance
 Risk Defining

31. Who regulates the National Pension System?

 IRDA
 SEBI
 PFRDAcorrect
 AMFI

32. An investor can pledge units of Mutual Fund as security against loan. True or False?

 TRUEcorrect
 FALSE
 33. The auditor appointed to audit the scheme accounts has to be the same as the
auditor of the AMC accounts.

 TRUE
 FALSEcorrect

34. Asset class C invests in _______________ as per the National Pension Scheme.

 Equity
 Government Securities
 Alternative Investment Productswrong
 Debt other than Government Securitiescorrect

35. A scheme invests in Government securities of 2 year tenor. Which index is the most
suitable?

 Si-Bexcorrect
 Mi-Bex
 Li-Bex

36. SEBI has made regulations about the outside liabilities of mutual fund schemes.
Which of the following is False?

 Scheme can borrow only up to 25 percent of its net assetscorrect

 Scheme cannot borrow for more than 6 monthswrong

37. Investors can invest in units of a particular scheme at ___________ when a new
scheme is launched which is called 'New Fund Offer' (NFO).

 Net Asset Value (NAV)

 Less than NAV
 More than NAV
 Face valuecorrect

38. What is the tax applicable on dividend distributed by a mutual fund ?

 2.50%
 2.33%
 1.50%
 No tax [Link]

39. How much unrated securities can a scheme own?

 10%
 15%wrong
 20%
 25%correct
 40. Which investment option should an investor avoid If he wants to earn regular
income?

 Post Office Monthly Income Scheme (MIS)

 Senior Citizen Savings Scheme (SCSS)
 Dynamic Asset Allocation Fundcorrect
 Monthly Income Plan (MIP)

41. What is the market price of a share if its PE Ratio is 20 and EPS is ₹12.5?

 ₹1.6
 ₹0.625
 ₹250correct
 ₹200

42. Which type of funds have a higher risk of giving poor returns because of fund
manager's poor strategy?

 Passive Funds
 Active Fundscorrect

43. Under Moderate Life Cycle Fund of Active Choice model of private sector NPS,
what is the maximum limit of investment in equity?

 40%wrong
 45%
 50%correct
 55%

44. Investments in mutual funds are subject to market risks. Therefore the fund –

 Will provide guaranteed returns

 Will guarantee capital protection in long run
 Will not provide guarantee of returns or capital appreciationcorrect

45. Relationship between an AMC and a distributor is on a basis of:

 Agent to principal
 Principal to Agentwrong
 Agent to Agent
 Principal to Principalcorrect

46. The investment in Mutual Fund portfolio is valued at market value of portfolio

 TRUEcorrect
 FALSE
 47. In relation to the transmission of units, In case of a single holder, where there are no
nominees, the units are transferred to__________.

 Government Body
 SEBI
 AMC
 Legal Heirscorrect

48. Indian Mutual Funds are allowed to invest in Real Estate Assets.

 TRUEcorrect
 FALSE

49. Which mechanism will a financial planner use to help an investor plan for
contingencies?

 Mutual Fund Schemeswrong

 Tax Planning
 Insurance Policiescorrect
 Arranging Loans from Banks

50. A retired person should not have any money invested in equity. True or False?

 TRUE
 FALSEcorrect

51. What is a driver of return and risk in a scheme?

 Investor profile of the scheme

 AUM of the scheme
 Market Sector in which the scheme has investedcorrect
 Age of the scheme

52. Anybody holding 40% or more of the net worth of AMC is considered to be a
__________ and hence required to comply with the qualification criteria:

 Trustee
 Sponsorcorrect
 Auditor
 Beneficiary

53. Liquid Schemes are a kind of Debt Fund Scheme which invest only in short term
Debt securities of a maturity of up to ______ :

 120 days
 60 dayswrong
 One Year
 91 Dayscorrect

54. Close ended funds offer higher liquidity than open ended funds because they are
traded on stock exchange. Correct or incorrect?

 Correct
 Incorrectcorrect

55. If a Mutual Fund Scheme is profitable, the true worth of its units will____.

 Decrease
 Remain the same as its face value
 Increasecorrect
 Not be impacted

56. When the interest rate in the market rise, value of a debt security will _________

 Fallcorrect
 Increase
 Not be affected

57. The difference between the NAV and the Re-purchase price is termed as

 Entry load
 Redemption
 Exit loadcorrect
 None of these

58. The Scheme of a Mutual Fund is paying regular dividends. Can this scheme be
used for Capital Appreciation?

 Yes
 Nocorrect

59. What is the formula to calculate how much money will be needed in future after
considering the inflation?

 P = A × (1 + r)ncorrect
 P = A × (1 - r)n

60. There are two approaches to financial planning, one is goal oriented. What is the
other?

 Risk Financial Planning

 Objective Financial Planning
 Comprehensive Financial Planningcorrect
 Inclusive Financial Planning
 61. Passive funds charge low expense ratio because there are no research or fund
management expenses. Correct or incorrect?

 Correctcorrect
 Incorrect

62. A distributor needs different ARN for each AMC ?

 TRUE
 FALSEcorrect

63. After investing in a mutual fund scheme, the investor gets a right to select the
securities in the portfolio of that scheme:

 TRUE
 FALSEcorrect

64. What is the unique ID of subscriber of NPS?

 ARN
 PRANcorrect
 Folio Number

65. A mutual fund must send Scheme-wise Annual Report or its abridged summary
within ________ of the end of a financial year.

 15 days
 31 days
 3 monthswrong
 4 monthscorrect

66. An investor invested in mid cap schemes one year ago and earned phenomenal
returns. Now he is investing all of his savings in mid cap schemes and advising others to
follow his advice as his investment acumen can earn them more than 20% returns p.a.
Which bias is he suffering from?

 Optimism/ Confidence Biascorrect

 Familiarity Bias
 Herd Mentality
 Choice Paralysis

67. Which of the following is not contained in an offer document?

 Breakup of portfolio between equity, debt, money market instruments

 Liquidity provisions such as listing, repurchase and redemption
 Shares in which the scheme will investcorrect
 Any guarantee provided
 68. The investment objective of a ____________ is to achieve growth by investing in
equity and equity related investments, along with income generation by investing in
debt and money market instruments.

 debt fund
 balanced schemecorrect
 ELSS Fund
 Sectoral Equity fund

69. SID mentions proposed asset allocation and nature of investment. True or False?

 TRUEcorrect
 FALSE

70. Which measure of risk is used to identify total risk in an investment?

 Standard Deviationcorrect
 Modified Duration
 Variance
 Beta

71. Payment aggregators like Bill Desk etc. are the service providers who facilitate
___________ processing.

 Physical Payment
 Cheque Collection
 Online paymentcorrect
 None of the above

72. Which factors lead to difference between scheme returns and investor returns?

 Exit Load
 Additional Investment
 Part Redemption
 All of the abovecorrect

73. If investor already has a folio with the mutual fund, only __________needs to be
submitted with the requisite payment for investment purpose.

 PAN Number
 KYC Documents
 ARN
 Transaction Slipcorrect

74. A portfolio is less risky than the market, when -

 Beta is less than 1correct

 Beta is more than 1
 Beta equals to 1

75. An investor asks you to recommend him a scheme. He has money that he can invest
for 3 years. He is looking to invest in debt but would like higher returns and would like
something of an alternate to fixed deposit. Which type of scheme would you suggest?

 MIP
 FMPcorrect
 Dynamic Asset Allocation Fund
 Income Fund

76. As per Code of Ethics and Code Of Conduct, All Distributors/Market

intermediaries have to keep ___________ Interest at the top:

 Their Own
 AMC's
 AMFI's
 Investor'scorrect

77. Fund Accounting Fees is_________ to the scheme:

 Allowed to be chargedwrong
 Not allowed to be chargedcorrect
 Freely allowed to be charged
 Allowed up to 1% to be charged

78. Which of the following is not contained in KIM?

 Scheme Performance
 Scheme Plans
 Dividend Policywrong
 Credit rating of debt instrumentscorrect

79. The P/E ratio is an important measure of -

 a company's past performance

 a company's anticipated performancecorrect
 a company's financial policies
 None of thesewrong

80. If an investor gives a local cheque of Rs 4 crore for investment in Gilt scheme at
11.30 A.M. What NAV would be the applicable to this investment?

 The closing NAV of the day preceding the date of application

 The closing NAV of the next working day
 The closing NAV of the application day
 The NAV of the business day on which the funds are available for utilization
before the cut off time of that daycorrect

81. To which variant of index are the mutual fund schemes benchmarked?

 Price Return variant of Index (PRI)

 Total Return variant of Index (TRI)correct

82. What do the technical analysts study to arrive at buy/ hold/ sell recommendation?

 Price Volume Chartcorrect

 Vertical Line Chart
 Footprint Chart

83. Timing the market is an important characteristic of Strategic Asset Allocation. True
or False?

 TRUE
 FALSEcorrect

84. G-Secs are guaranteed by Government, hence, they are not prone to fluctuation in
value like non-Government securities. Correct or incorrect?

 Correct
 Incorrectcorrect

85. Re-purchase price can be determined by ___________exit load from the effective
NAV.

 Adding
 Subtractingcorrect
 Multiplying
 Dividing

86. If a scheme is launched in November, 2018, what is the last date by which SID
should be updated?

 31st Dec, 2018

 31st March, 2019
 30th June, 2019
 30th June, 2020correct

87. In Dividend payout option, the fund declares dividend from time to time. Since NAV
falls to that extent, there is a liability of Dividend Distribution tax.

 TRUEwrong
 FALSEcorrect
 88. Which statement is correct -

 NAV remains constant in closed ended fund?

 Unit capital remains constant in closed ended fund?correct
 A & B both are correct
 None of these

89. A distributor is not liable for the acts and defaults of its agents/ sub brokers:

 TRUE
 FALSEcorrect

90. A new mutual fund scheme is launched through -

 New Scheme Offer

 New Fund Offercorrect
 New Mutual Fund Offer
 Offer of Mutual Fund Scheme

91. Which of the following is not an objective of AMFI?

 To approve Fund Managers appointed by Mutual Fundscorrect

 To undertake Investor Awareness Programme
 To undertake studies and research on Mutual Fund industry
 To represent to Government, RBI and SEBI on mutual fund related matters

92. A Custodian is responsible for :

 Keeping records of Unit Holders

 Issuing Account Statements to Unit Holders
 Executing investment transactions in the market
 Keeping the securities of Mutual Fund Scheme in custodycorrect

93. What is the advantage of Gold ETF over holding gold in physical form?

 No risk of loss by theft

 No storage cost
 Liquidity
 All of the abovecorrect

94. If an investor redeems 1 unit out of total 100 units when NAV is Rs. 15 and units are
redeemed at face value of Rs. 10, the post redemption NAV will be Rs.

 14.95
 14.9
 15wrong
 15.05correct
 95. What does CAPM stand for?

 Current Asset Price Model

 Capital Asset Pricing Mechanism
 Cash Asset Pricing Mechanism
 Capital Asset Pricing Modelcorrect

96. An investor has 1000 units of a scheme which declares a 1: 2 bonus. The NAV Ex
Bonus becomes Rs 30. How much does the investor has to pay to get the additional units
as per the allotment due to him?

 Rs 30,000
 Rs 15,000
 Rs 5,000
 NILcorrect

97. When units of a close ended mutual fund scheme are sold on a stock exchange, the
price at which it will be sold will be equal to its NAV. True or False?

 TRUE
 FALSEcorrect

98. A financial advisor recommends to an investor that he should have as much debt in
his portfolio as his age. Which type of asset allocation is he recommending to the
investor?

 Strategiccorrect
 Tactical

99. Application form is attached to ___________ .

 SID
 KIMcorrect
 SAI
 None of the above

100. If an investor wants to compare returns from two schemes, where the investment
period was different and less than one year, which return would he compare?

 Simple Return
 Annualised Returncorrect
 Compounded Return
 You scored 83 points out of 100 points.

Number of Correct answers - 83

Number of Wrong answers - 16
Number of unanswered questions - 1

Your answers are shown below:

1. For an equity scheme, if the Subscription / switch in application with investment amount up to
Rs 200000 is received after 3 pm, the applicable NAV will be:

 Closing NAV of the same day

 Closing NAV of the next business daycorrect
 Closing NAV of the day on which the funds available for utilizationwrong
 None of the above

2. Which factor should a person check while investing in a non-gilt debt scheme?

 Coupon Rate of Securitieswrong

 Sector Concentration of the Schemecorrect
 Share Price Movement
 None of the above

3. What does CAPM stand for?

 Current Asset Price Model

 Capital Asset Pricing Mechanism
 Cash Asset Pricing Mechanism
 Capital Asset Pricing Modelcorrect

4. Primary function of a mutual fund is to help investors earn income or build wealth by

 Keeping the money collected in safe deposit with banks

 Bidding for Government Tenders
 Participating in opportunities offered by securities marketscorrect
 None of the above

5. If value of purchase and sale of securities is Rs. 6,000 and average size of net assets is Rs. 3,000,
what is the average holding period of securities?
 4 monthswrong
 5 months
 6 monthscorrect
 7 months

6. Which measure of risk is relevant only for equity schemes ?

 Variance
 Betacorrect
 Standard Deviation
 Modified Duration

7. All funds other than equity funds are treated as debt fund for the purpose of taxation.

 TRUEcorrect
 FALSE

8. Who has issued guidelines to prevent circulation of unauthenticated news by intermediaries?

 Ministry of Information & Broadcasting

 SEBIcorrect
 AMFIwrong
 RBI

9. Decision to launch a scheme is based on the inputs of -

 CIO and CMOcorrect

 Board of Directors and Trusteeswrong
 CIO and CEO
 CMO and CEO

10. Transaction charges on SIP are applicable if

 Committed investment is less than Rs. 10000

 Committed investment is equal to or more than Rs. 10000correct
 Committed investment is more than Rs. 10000wrong
 Not applicable at all

11. What do the technical analysts study to arrive at buy/ hold/ sell recommendation?

 Price Volume Chartcorrect

 Vertical Line Chart
 Footprint Chart

12. SID mentions proposed asset allocation and nature of investment. True or False?
 TRUEcorrect
 FALSE

13. In which of the following asset classes can an investor allocate his investment under National
Pension Scheme subject to regulatory limits?

 Equities
 Debt
 Government Securities
 All of the abovecorrect

14. An investor holds 1200 units of a scheme , scheme declares 1:3 bonus. How many units the
investor will get?

 200
 300
 400correct
 600

15. Which index is better suited to diversified equity fund which invests in large cap stocks?

 S&P BSE Sensexcorrect

 Nifty Midcap 50

16. What is required to form the basis of appointment of a mutual fund distributor:

 Approval from SEBI

 Power of Attorney from AMC
 Agreement between AMC and Distributorcorrect
 Agreement between AMFI and Distributor

17. As per SEBI categorisation, Conservative Hybrid Funds invest predominantly in debt securities
with a small allocation to ______which can range between _____ of the total assets.

 Bonds, 5-50%
 Bonds, 5-30%
 Equity, 10-25%correct
 Government Security, 5-30%

18. Payment aggregators like Bill Desk etc. are the service providers who facilitate ___________
processing.

 Physical Payment
 Cheque Collection
 Online paymentcorrect
 None of the above

19. Which investment option should an investor avoid If he wants to earn regular income?

 Post Office Monthly Income Scheme (MIS)

 Senior Citizen Savings Scheme (SCSS)
 Dynamic Asset Allocation Fundcorrect
 Monthly Income Plan (MIP)

20. If the investor wants to take low risk and earn only interest income from a debt scheme, where
should he invest?

 Long maturity debt Fund

 Short maturity debt fundcorrect

21. In which phase is the investor's exposure to equity the highest?

 Accumulationcorrect
 Inter-Generational Transfer
 Retirement
 None of the above

22. Which type of scheme can own higher percentage of illiquid assets?

 Open ended scheme

 Close ended schemecorrect

23. Re-purchase price can be determined by ___________exit load from the effective NAV.

 Adding
 Subtractingcorrect
 Multiplying
 Dividing

24. Which of the following statements is correct?

 Asset allocation is done to minimize riskcorrect

 Asset allocation is done to time the market
 Asset allocation is done to maximize returns

25. As per SEBI categorisation of Equity Schemes, Large & Mid Cap Funds have to invest a
minimum of _______% in Large cap Stocks and _____% in Mid cap stocks out of the total assets:

 40, 40
 50, 50
 40. 50
 35, 35correct

26. The difference between the NAV and the Re-purchase price is termed as

 Entry load
 Redemption
 Exit loadcorrect
 None of these

27. ______________ invest in debt securities whose tenor is 1 to 3 years.

 Diversified Debt Funds

 Liquid Funds
 Ultra Short Term Debt Fund
 Short Term Debt Fundscorrect

28. Other mutual funds registered with SEBI are eligible to invest in a Mutual Fund Scheme.

 TRUEcorrect
 FALSE

29. Role of Credit rating agencies is highest in debt funds.

 TRUEcorrect
 FALSE

30. The market has been experiencing a bull run and pharma sector has performed very well. A
critical legislation is pending in the parliament, which if passed will lead to fall in the price of
stocks of pharma sector. An investor has checked the 1-year, 3-year performance of the sector and
is confident that sector will give good returns in the future. Which bias is the investor exhibiting?

 Confidence Bias
 Familiarity Bias
 Herd Mentality
 Recency Biascorrect

31. If the investment corpus of an investor is not very large, which investment option poses
greatest concentration risk?

 Gold
 Real Estatecorrect
 Mutual Funds
 32. G-Secs are guaranteed by Government, hence, they are not prone to fluctuation in value like
non-Government securities. Correct or incorrect?

 Correct
 Incorrectcorrect

33. Permission from SEBI is required for appointment of Bankers or the Stock brokers as the
distributors of Mutual Fund Schemes:

 TRUE
 FALSEcorrect

34. A non traded or thinly traded equity instrument can not be valued using the capitalisation of
earnings method

 TRUEcorrect
 FALSE

35. In which stage of the wealth cycle, does the investor consider transfer of wealth to his
descendants?

 Distribution
 Inter-Generational Transfercorrect
 Transition
 Accumulation

36. Which body regulates mutual funds in India?

 SEBIcorrect
 AMFI
 IRDA
 Ministry of Finance

37. The Custodian of a Mutual Fund is responsible for Acceptance and delivery of securities for the
purposes of sale/purchase transactions of various schemes of the Fund:

 TRUEcorrect
 FALSE

38. Which of the following is not contained in an offer document?

 Nature of Scheme
 Investment Objectives and Investment Pattern
 Comparison of Schemescorrect
 Terms of Issue
 39. What is the PE ratio if the market price of share is Rs. 200 and EPS is Rs. 20?

 10correct
 0.1
 180
 4000

40. Which type of mutual fund scheme buys and sells the same security at the same time in
different markets and takes advantage of price difference?

 MIP
 Arbitrage Fundcorrect
 Dynamic Asset Allocation Fund
 Quant Fund

41. Relationship between an AMC and a distributor is on a basis of:

 Agent to principal
 Principal to Agentwrong
 Agent to Agent
 Principal to Principalcorrect

42. No change will be allowed in the fundamentals of scheme or any other change which may
compromise the interest of investors unless communication is done with investors and an option
is given to them for exit at NAV without any exit load.

 TRUEcorrect
 FALSE

43. Scheme auditor is appointed by Trustees, AMC auditor is appointed by AMC.

 TRUEcorrect
 FALSE

44. The Trail commission payable by Mutual Fund to a distributor:

 Is Calculated on NAVcorrect
 Is paid only for high value transactions
 Is banned
 Is paid to institutional distributors only

45. The asset allocation which is based on risk profiling of investor is called ___

 Tactical Asset Allocation

 Prudent Asset Allocation
 Profiling Asset Allocation
 Strategic Asset Allocationcorrect

46. Which measure of risk compares the fluctuation in periodic returns of the scheme with its own
average return?

 Variancewrong
 Standard Deviation
 None of the above
 Both a and bcorrect

47. What will a Fundamental Analyst study to determine price target of a share?

 Past price behaviour of shares

 Financial Parameters like EPS, PE Ratio, [Link]
 Volume of Shares Traded
 None of the above

48. Maximum commission payable to a distributor on his own investments will be :

 0.50%
 1.00%
 1.50%
 NILcorrect

49. NPA stands for

 National performance Association

 Non Performing assetscorrect
 No profit assets
 None of the above

50. An investor looking for an alternative to bank account should invest in -

 Fixed maturity Plans

 Ultra Short Term Debt Fundscorrect
 Income Fund
 Dynamic Bond Fund

51. Being an advisor to whom you will suggest 75% allocation in debt?

 Couple running in 70 plus age with no immediate family supportcorrect

 42 year old man living with grown up children
 Yound couple with one school going kinds
 Young executive working with MNC

52. If a Mutual Fund Scheme is profitable, the true worth of its units will____.

 Decrease
 Remain the same as its face value
 Increasecorrect
 Not be impacted

53. Which credit rating means lowest credit risk?

 AAAcorrect
 AA
 Awrong

54. When it comes to debt, longer the duration, more stable the returns. Correct or incorrect?

 Correct
 Incorrectcorrect

55. What is the process of identifying investor's risks appetite called?

 Risk Identifying
 Risk Profilingcorrect
 Risk Assurance
 Risk Defining

56. The investor must get his PRAN changed within 6 months of changing his employer. True or
False?

 TRUE
 FALSEcorrect

57. Which type of asset class in NPS carries risk of default?

 A
 Ccorrect
 G
 Ewrong

58. Which type of mutual fund scheme would have an investment objective like 'To achieve
growth by investing in equity and equity related investments, balanced with income generation by
investing in debt and money market instruments'.

 Diversified Equity
 Diversified Debt
 Balancedcorrect
 None of the above

59. Which of the following is a salient feature of FMP?

 It gives fixed income

 Capital is guaranteed
 NAV never fluctuates
 No option is correctcorrect

60. How the risk appetite of an investor is assessed?

 Asset allocation
 Earning potential
 financial planning
 Risk Profilingcorrect

61. Calculate the Net Assets of a Fund if the market value of portfolio is Rs.1000 crores and the
current liabilities are Rs 50 crores?

 Rs. 1050 Crores

 Rs. 950 Crorescorrect
 Rs. 50 Crores
 Rs. 1000 Crores

62. Essential Feature of a Mutual Fund is that it can sell Units under one scheme only.

 TRUE
 FALSEcorrect

63. What is relevant while deciding which benchmark should be chosen for an equity scheme?

 Scheme Type
 Choice of Investment Universe
 Choice of Portfolio Concentration
 All of the abovecorrect

64. Value Funds are the funds which invest in stocks which are valued at a higher price based on
the fundamental analysis:

 TRUE
 FALSEcorrect
 65. The stock exchanges which provide mutual fund trading facilities also have to provide for
settlement guarantee - State True or False?

 TRUE
 FALSEcorrect

66. Who is primarily responsible to create awareness about mutual funds?

 AMFIcorrect
 SEBI
 Asset Management Companies
 Mutual Fund Distributorswrong

67. _______________ measures how closely an index fund tracked benchmark returns.

 Tracking Errorcorrect
 Alpha
 Beta
 Sharpe

68. As defined in the SEBI (mutual Funds) Regulation Act, 1996, a mutual fund is to be constituted
as a:

 Public Limited Company

 Private Limited Company
 Trustcorrect
 Government body

69. Is it necessary to take Prior approval of SEBI before a person is appointed as trustee?

 Yescorrect
 Nowrong

70. An Indian Citizen having attained an age of ____ Years is eligible to invest in any Mutual Funds
Scheme:

 21
 18correct
 25
 None of these

71. In case of open ended funds, if the units are switched out before load period, no exit load is
levied?

 TRUE
 FALSEcorrect

72. The Expense Ratio of the Direct Plan of a particular MF Scheme will be ______the Regular plan
of the same scheme:

 Lower thancorrect
 Higher than
 Equal to

73. Which of the following ratio measures risk -adjusted performance?

 Beta
 Alphacorrect
 Standard Deviationwrong
 R-Squared

74. Mark to Market would mean that:

 Net assets are shown at historical values

 Net assets are shown at face values
 Each security is valued at its current market pricecorrect
 Securities are not to be valued at all

75. What would be the redemption value of a Unit if NAV is Rs 20 and Exit load is 1%.

 Rs 20
 Rs 2.20
 Rs 19.80correct
 Rs22

76. Where would be the risk of an Income Fund as per riskometer?

 Moderately Low
 Moderatecorrect
 Moderately High
 High

77. Which document should an investor refer to make an informed investment decision?

 FactSheet
 Offer Documentcorrect

78. To which variant of index are the mutual fund schemes benchmarked?

 Price Return variant of Index (PRI)

 Total Return variant of Index (TRI)correct

79. What are the two categories under which customer client relationship and transactions be
categorized?

 Advisory, Executioncorrect
 Financial Planning, Advisory
 Risk Planning, Advisor

80. After investing in a mutual fund scheme, the investor gets a right to select the securities in the
portfolio of that scheme:

 TRUE
 FALSE correct

Question was not answered

81. Which category of schemes would use 'CRISIL Composite Bond Fund Index [25% allocation] +
S&P BSE 200 (TRI) [75% allocation]' as their benchmark?

 Aggressive Hybrid Fundcorrect

 Balanced Hybrid Fund
 Conservative Hybrid Fund

82. What does modified duration of security indicate?

 Tenor of the security

 Credit risk of the security
 how much will the value of a debt security fluctuate in response to change in
interest ratecorrect
 None of the above

83. What is the use of core portfolio?

 To take advantage of long term opportunitiescorrect

 To take advantage of short term opportunities
 To invest in sector funds and mid-cap funds
 To invest in long term debt funds

84. Risk profiling tools should not be used because they reduce investor confidence and mislead
them. True or False?

 TRUE
 FALSEcorrect
 85. In relation to the transmission of units, In case of a single holder, where there are no
nominees, the units are transferred to__________.

 Government Body
 SEBI
 AMC
 Legal Heirscorrect

86. Which index is most suitable for Overnight Fund?

 CRISIL Composite Bond Fund Index

 CRISIL Long Term Debt Index
 CRISIL Corporate Bond Composite Index
 CRISIL CBLO Indexcorrect

87. In Dividend payout option, the fund declares dividend from time to time. Since NAV falls to
that extent, there is a liability of Dividend Distribution tax.

 TRUEwrong
 FALSEcorrect

88. What is the market price of a share if its PE Ratio is 20 and EPS is ₹12.5?

 ₹1.6
 ₹0.625
 ₹250correct
 ₹200

89. What kind of mutual fund scheme is an MIP?

 Debt-oriented Hybridcorrect
 Equity-oriented Hybrid
 Debt Fund
 Equity Fund

90. Units of gold ________________ are traded on stock exchange.

 ETFcorrect
 Open ended Sector Funds
 Deposit scheme
 Futures

91. A traded security shall be valued at the last quoted closing price on the principle stock
exchange where it is traded.
 TRUEcorrect
 FALSEwrong

92. Which index is most suitable for Dynamic Bond Fund?

 CRISIL Composite Bond Fund Indexcorrect

 CRISIL Long Term Debt Index
 CRISIL Corporate Bond Composite Index
 CRISIL CBLO Index

93. Who executes the sale and purchase (investments) of mutual fund schemes in the stock
market.

 R & T agent
 Custodian
 Dealercorrect
 AMC

94. Which funds invest in those stocks that are expected to grow higher than the market?

 Growthcorrect
 Value

95. Who carries out credit rating of the securities in which mutual fund schemes invest?

 AMFI
 RBI
 SEBI
 None of the abovecorrect

96. Gilt Funds invest only in Treasury Bills and _________________.

 Corporate Bonds
 Debentures
 Government securitiescorrect
 AAA rated Debt securities

97. If an investor gives a local cheque of Rs 4 crore for investment in Gilt scheme at 11.30 A.M.
What NAV would be the applicable to this investment?

 The closing NAV of the day preceding the date of application

 The closing NAV of the next working day
 The closing NAV of the application day
 The NAV of the business day on which the funds are available for utilization
before the cut off time of that daycorrect
 98. There are two approaches to financial planning. Both have stages. Which type of planning has
these stages - childhood, young unmarried, young married, married with children, etc?

 Life Cycle Approachcorrect

 Wealth Cycle Approach

99. The investment objective of a ____________ is to achieve growth by investing in equity and
equity related investments, along with income generation by investing in debt and money market
instruments.

 debt fund
 balanced schemecorrect
 ELSS Fund
 Sectoral Equity fund

100. SEBI has stipulated that every scheme should have at least _____ investors and no investor
should represent more than _________ percent of net assets of a scheme.

 25, 20wrong
 20, 25correct
 20, 20
 25, 25
 Number of Correct answers - 88
Number of Wrong answers - 12
Number of unanswered questions - 0

Your answers are shown below:

1. Who carries out credit rating of the securities in which mutual fund schemes invest?

 AMFI
 RBI
 SEBI
 None of the abovecorrect

2. A minimum of ______of the directors on the Board of AMC should be independent

directors i.e. not associated with sponsor or its subsidiaries or trustees :

 75%wrong
 25%
 50%correct
 10%

3. A couple in seventies should invest in only debt mutual funds and not equity. True or
False?

 TRUE
 FALSEcorrect

4. Custodian monitors and tracks corporate actions like dividend, Bonus and Rights
issues of companies where the scheme has invested.

 TRUEcorrect
 FALSE

5. How much can a mutual fund invest in one sector (except financial service sectors)?

 10.00%
 15.00%
 20.00%wrong
 25.00%correct

6. Units of gold ________________ are traded on stock exchange.

 ETFcorrect
 Open ended Sector Funds
 Deposit scheme
 Futures

7. When the interest rate in the market rise, value of a debt security will _________

 Fallcorrect
 Increase
 Not be affected

8. Which type of funds have a higher risk of giving poor returns because of fund
manager's poor strategy?

 Passive Funds
 Active Fundscorrect

9. What initial commission is paid by investor to the disributor?

 Nilcorrect
 0.05%
 0.25%
 0.005

10. Stock Exchange brokers having experience over 10 years can distribute the mutual
fund units without passing any certification exam.

 TRUE
 FALSEcorrect

11. _______________ contains details of a particular scheme?

 Scheme Investment Document

 Statement of Asset Information
 Scheme Information Documentcorrect
 Statement of Additional Information

12. Professionals working with intermediaries and engaged in sales/marketing process

of mutual fund products must obtain EUIN (Employee unique identification number)
from

 KYD
 AMFIcorrect
 NISM
 None of the above

13. Which credit rating means lowest credit risk?

 AAAcorrect
 AA
 A

14. indexation refers to Adjusting the Purchase Price of

the Fund considering the Inflation.

 TRUEcorrect
 False

15. Fixed Maturity Plans align the maturity of their portfolio to the maturity of the
scheme. Correct or incorrect?

 Correctcorrect
 Incorrect

16. Investors can invest in units of a particular scheme at ___________ when a new
scheme is launched which is called 'New Fund Offer' (NFO).

 Net Asset Value (NAV)

 Less than NAV
 More than NAV
 Face valuecorrect

17. REIT is the abbreviation for:

 Railway Engineering & Investment Trust

 Real Engineering & Investment Trust
 Real Estate Investment Trustcorrect
 Rural Estate Investment Trust

18. An investor looking for an alternative to bank account should invest in -

 Fixed maturity Plans

 Ultra Short Term Debt Fundscorrect
 Income Fund
 Dynamic Bond Fund

19. Any individual below 18 years of age (MINOR) can ______________

 invest through his parents or lawful guardianscorrect

 not invest in mutual funds scheme
 both a and b
 invest in fixed deposit only
 20. While calculating profits, all the expenses that relate to a period need to be
considered, irrespective of whether or not the expense has been paid. This principal is
referred to as?

 Accrual systemcorrect
 Legal entity system
 Double entry system
 None of the above

21. Who regulates the National Pension System?

 IRDA
 SEBI
 PFRDAcorrect
 AMFI

22. As per SEBI, which returns should be considered to check the performance of a
scheme over the years?

 Simple Return
 Compounded Return
 Compounded Annual Growth Rate Returncorrect
 Annualised Return

23. An investor who wants to invest in foreign markets, he should invest in –

 International Fundscorrect
 Arbitrage Funds
 Large Cap Funds
 Mid Cap Funds

24. What is the use of core portfolio?

 To take advantage of long term opportunitiescorrect

 To take advantage of short term opportunities
 To invest in sector funds and mid-cap funds
 To invest in long term debt funds

25. What is the CAGR's formula?

 1*n
(LV ÷ IV) - 1
 1÷n
(LV ÷ IV) - 100
 1÷n
(LV ÷ IV) - 1correct
 1÷n
(LV ÷ IV) + 1

26. After investing in a mutual fund scheme, the investor gets a right to select the
securities in the portfolio of that scheme:
 TRUE
 FALSEcorrect

27. Primary function of a mutual fund is to help investors earn income or build wealth
by

 Keeping the money collected in safe deposit with banks

 Bidding for Government Tenders
 Participating in opportunities offered by securities marketscorrect
 None of the above

28. Investments in mutual funds are subject to market risks. Therefore the fund –

 Will provide guaranteed returns

 Will guarantee capital protection in long run
 Will not provide guarantee of returns or capital appreciationcorrect

29. For formation of a Mutual Fund Trust, a Trust Deed is to be executed between the:

 Trustees and the Beneficiarieswrong

 Trustees and the Sponsorscorrect
 Sponsors and the Beneficiaries
 Sponsors and the AMC

30. An investor asks you to recommend him a scheme. He has money that he can invest
for 3 years. He is looking to invest in debt but would like higher returns and would like
something of an alternate to fixed deposit. Which type of scheme would you suggest?

 MIP
 FMPcorrect
 Dynamic Asset Allocation Fund
 Income Fund

31. Bio Metric document verification procedure is adopted for

 KYD Processcorrect
 KYC Process
 ARN Process
 None of These

32. Which statement is correct -

 NAV remains constant in closed ended fund?

 Unit capital remains constant in closed ended fund?correct
 A & B both are correct
 None of these
 33. To which variant of index are the mutual fund schemes benchmarked?

 Price Return variant of Index (PRI)

 Total Return variant of Index (TRI)correct

34. Liquid Schemes are a kind of Debt Fund Scheme which invest only in short term
Debt securities of a maturity of up to ______ :

 120 days
 60 dayswrong
 One Year
 91 Dayscorrect

35. When an investor's capital base rises, his risk appetite __________.

 Risescorrect
 Falls
 Remains same

36. Passive funds charge low expense ratio because there are no research or fund
management expenses. Correct or incorrect?

 Correctcorrect
 Incorrect

37. Only ___________ Investor can make nomination.

 Institutional
 Government
 Individualcorrect
 Educational Institution

38. Though debt securities do not give as much return as equity but at least there is no
chance of loss of principal if invested in debt fund. Correct or incorrect?

 Incorrectcorrect
 Correct

39. For making Investment in Exchange Traded Funds (ETF) Units, opening of a
Demat account is mandatory:

 TRUEcorrect
 FALSE

40. If the investor wants to take low risk and earn only interest income from a debt
scheme, where should he invest?
 Long maturity debt Fund
 Short maturity debt fundcorrect

41. What tax rate is applicable for equity fund less than 12 months?

 25%
 20%
 15%correct
 Nil

42. As per SEBI categorisation of Equity Schemes, Large & Mid Cap Funds have to
invest a minimum of _______% in Large cap Stocks and _____% in Mid cap stocks out
of the total assets:

 40, 40
 50, 50
 40. 50
 35, 35correct

43. Close ended funds offer higher liquidity than open ended funds because they are
traded on stock exchange. Correct or incorrect?

 Correct
 Incorrectcorrect

44. Which statement is correct -

 investment made in Gold ETF gives Guaranteed high return

 investment made in Gold ETF gives highest risk cover
 investment made in Gold ETF reduces the cost of storage and risk of
theftcorrect
 investment of one lakh and above is accepted in Gold ETF

45. What does EIC Framework stand for?

 Economy, Interest, Currency

 Equity, Interest, Country
 Economy, Industry, Companycorrect
 Equity, Industry, Currency

46. Which measure of risk is used to identify total risk in an investment?

 Standard Deviationcorrect
 Modified Duration
 Variance
 Beta
 47. “Mutual fund investments are subject to market risks, read the offer document
carefully before investing ” this line should be displayed on posters and hoardings with
at least -----------alphabet height .

 10 inches
 12 inches
 11 inches
 8 inchescorrect

48. A new mutual fund scheme is launched through

 New Scheme Offer

 New Fund Offercorrect
 New mutual fund Offer
 offer of mutual fund Scheme

49. What kind of mutual fund scheme is an MIP?

 Debt-oriented Hybridcorrect
 Equity-oriented Hybrid
 Debt Fund
 Equity Fund

50. Mutual Funds are Governed as per the provisions of Indian Trusts Act since they
are constituted as Trusts.

 TRUEcorrect
 FALSE

51. Transaction charges are to be borne by

 AMFI
 Distributor
 Investorcorrect
 AMC

52. An intermediary has laid down internal code of conduct and appointed a
Compliance Officer. An employee of his sends a market related rumour to the clients of
the intermediary. Who is responsible?

 Employee
 Compliance Officer
 None of these
 Both A and Bcorrect

53. Under Conservative Life Cycle Fund of Active Choice model of private sector NPS,
what is the maximum limit of investment in equity?
 20%
 25%correct
 30%
 35%

54. Which of the following statements is true?

 Financial planning creates unnecessary stress on the investor.

 Financial planning is necessary only for rich people.
 Financial Planning helps a person in ascertaining how much he should save,
invest and borrow and which goals of his are not [Link]
 An investor can fulfil all his objectives with proper financial planning.

55. If an investor wants to compare returns from two schemes, where the investment
period was different and less than one year, which return would he compare?

 Simple Return
 Annualised Returncorrect
 Compounded Return

56. The asset allocation decided for an investor based on his Risk profiling refers to -

 Flexible asset allocation

 Objective based allocation
 Strategic asset allocationcorrect
 Tactical asset allocation

57. When it comes to debt, longer the duration, more stable the returns. Correct or
incorrect?

 Correct
 Incorrectcorrect

58. Who is primarily responsible to create awareness about mutual funds?

 AMFIcorrect
 SEBI
 Asset Management Companies
 Mutual Fund Distributorswrong

59. KIM contains key points of Offer Document as it is basically a summary of SID and
SAI. True or False?

 TRUEcorrect
 FALSE
 60. Under Systematic Investment Plan, Investors can book SIPs by investing through
Post dated cheques (PDCs).

 TRUEcorrect
 FALSE

61. When will a company pay high dividend yield?

 High dividend payout

 Low Market Price of Share
 Both the abovecorrect
 None of the above

62. When money market instruments and debt securities with residual maturity of up to
60 days are not traded on a particular day, they shall be valued on __________.

 Yield Matrix basis

 Capitalisation of earnings basis
 Amortization basiscorrect
 None of the above

63. Which funds invest in those stocks that are expected to grow higher than the
market?

 Growthcorrect
 Value

64. Mutual funds can hedge their portfolio on weighted average modified duration basis
by investing in Interest Rate Futures (IFRs). Correct or Incorrect?

 Correctcorrect
 Incorrect

65. Which measure of risk is relevant only for debt schemes?

 Variance
 Beta
 Standard Deviation
 Modified Durationcorrect

66. Timing the market is an important characteristic of Strategic Asset Allocation. True
or False?

 TRUE
 FALSEcorrect

67. What minimum net worth is required for a new AMC?

 Rs 500 Crore
 Rs 50Crorecorrect
 Rs 5 Crore
 Not specified

68. It is mandetory for AMCs to mention the unclaimed amount and the number of
such investors for each scheme in the annual report .

 TRUEcorrect
 False

69. Which index is better suited to diversified equity fund which invests in large cap
stocks?

 S&P BSE Sensexcorrect

 Nifty Midcap 50

70. A non traded or thinly traded equity instrument can not be valued using the
capitalisation of earnings method

 TRUEcorrect
 FALSEwrong

71. What does PFRDA stand for?

 Pension Funds Regulatory and Development Authoritycorrect

 Provident Fund Regulatory and Development Authority

72. Systematic transfer plan is a combination of SIP and SWP.

 TRUEcorrect
 FALSE

73. Why is Goal Oriented financial planning undertaken?

 To plan for all the needs an upcoming expenses of a person

 To evaluate particular investment options
 When a person has limited money, this is the most appropriate approach
 To find out how much money will be needed, when it will be needed to
achieve on particular goalcorrect

74. Which document contains condensed financial information, rights of unit holders
and investment valuation norms?

 Scheme Investment Document

 Statement of Asset Information
 Scheme Information Documentwrong
 Statement of Additional Informationcorrect

75. In an Active fund, the investor is supposed to take _______risk and the cost is
_______.

 Higher, Highercorrect
 Higher, Lower
 Lower, Lower
 Lower, Higher

76. Who executes the sale and purchase (investments) of mutual fund schemes in the
stock market.

 R & T agent
 Custodianwrong
 Dealercorrect
 AMC

77. All funds other than equity funds are treated as debt fund for the purpose of
taxation.

 TRUEcorrect
 FALSE

78. If investor already has a folio with the mutual fund, only __________needs to be
submitted with the requisite payment for investment purpose.

 PAN Number
 KYC Documents
 ARN
 Transaction Slipcorrect

79. If a scheme is launched in November, 2018, what is the last date by which SID
should be updated?

 31st Dec, 2018

 31st March, 2019
 30th June, 2019
 30th June, 2020correct

80. Maximum annual limit specified by SEBI for Recurring expenses of a debt scheme
with a daily net asset of Rs. 600 crores will be:

 Rs. 8.25 crores

 Rs. 9.50 crores
 Rs. 9.25 Crores
 Rs. 11.75 Crorescorrect
 81. Once the asset allocation is decided---------------- can help us to select the good debt
and equity Schemes.

 PE Ratio
 Sharp Ratiocorrect
 Beta
 SDwrong

82. Scheme auditor is appointed by Trustees, AMC auditor is appointed by AMC.

 TRUEcorrect
 FALSE

83. A person does not want a regular income, falls in low tax slab and has a long
investment horizon. Which scheme option should he choose?

 Growthcorrect
 Dividend Re-Invest
 Dividend Payout

84. According to Certified Financial Planner - Board of Standards, the last stage of
financial planning is -

 Implementing the financial planning recommendations

 Analyzing and evaluating client's financial status
 Monitoring the financial planning recommendationscorrect
 Developing and presenting financial planning recommendations and/or
alternatives

85. How the risk appetite of an investor is assessed?

 Asset allocation
 Earning potential
 financial planning
 Risk Profilingcorrect

86. How is PE Ratio calculated?

 Net Profit After Tax / No. of Equity Shares Outstanding

 Market Price of Shares / Growth in Earnings
 Market Price of Shares / Earnings Per Sharecorrect
 Market Price of Shares / Book Value Per Share

87. Why is risk profiling done?

 To understand investor's risk appetitecorrect

 To understand risk level of investment options being considered
 Both a and bwrong
 None of the above

88. All Mutual Fund Trusts have beneficiaries.

 TRUEcorrect
 FALSE

89. SEBI has made regulations about the outside liabilities of mutual fund schemes.
Which of the following is False?

 Scheme can borrow only up to 25 percent of its net assetscorrect

 Scheme cannot borrow for more than 6 months

90. Which type of scheme can own higher percentage of illiquid assets?

 Open ended scheme

 Close ended schemecorrect

91. A portfolio is less risky than the market, when -

 Beta is less than 1correct

 Beta is more than 1
 Beta equals to 1

92. If the fund manager expects interest rates to fall where should he invest?

 Floating rate debt securities

 Fixed rate debt securities of short tenor
 Fixed rate debt securities of long tenorcorrect
 None of the above

93. According to Certified Financial Planner - Board of Standards, the first stage of
financial planning is -

 Gathering client data, including goals

 Analyzing and evaluating client's financial status
 Establishing and defining the client-planner relationshipcorrect
 Developing and presenting financial planning recommendations and/or
alternatives

94. Can Indian mutual funds invest in Gold?

 Yescorrect
 No

95. What is required to form the basis of appointment of a mutual fund distributor:
 Approval from SEBI
 Power of Attorney from AMC
 Agreement between AMC and Distributorcorrect
 Agreement between AMFI and Distributor

96. As per Code of Ethics and Code Of Conduct, All Distributors/Market

intermediaries have to keep ___________ Interest at the top:

 Their Own
 AMC's
 AMFI's
 Investor'scorrect

97. Is it necessary to take Prior approval of SEBI before a person is appointed as

trustee?

 Yescorrect
 Nowrong

98. Trustee of one Mutual Fund is also eligible to become trustee of any other mutual
fund.

 TRUE
 FALSEcorrect

99. Who is responsible for selection of stocks and securities in a mutual fund scheme?

 Chief Executive Officer

 Chief Finance Officer
 Fund Managercorrect

100. What can lead to cancellation of intermediary's registration?

 First violation of AMFI Guidelines & Norms for Intermediaries wrong

 Second violation of AMFI Guidelines & Norms for Intermediaries correct
 Third violation of AMFI Guidelines & Norms for Intermediaries
 Fourth violation of AMFI Guidelines & Norms for Intermediaries