Professional Documents
Culture Documents
3. AMFI
7. An open-ended mutual fund is one that has:
4. distribution agents based on demand for the 1. an option to invest in any kind of security
fund
2. units available for sale and repurchase at all
3. The amount required to buy 100 units of a times
scheme having an entry load of 1.5% and NAV of 3. an upper limit on its NAV
Rs.20 is :
4. a fixed fund size
1. Rs.2000
2. Rs.2015 8. An investor in a close-ended mutual fund can
3. Rs.1985 get his/her money back by selling his/her units:
1. back to the fund
4. Rs.2030
2. to a special trust at NAV
4. A gilt fund is a special type of fund that invests : 3. on a stock exchange where the fund is listed
1. in very high quality equity only 4. to the agent through which he/she subscribed
2. in instruments issued by companies with a to the units of the fund
sound track record
3. in short-term securities 9. The "load" charged to an investor in a mutual
fund is
4. in government securities only 1. entry fee
2. cost of the paper on which the unit certificates
5. Of the following fund types, the highest risk is
associated with are printed
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 1/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
11. Units from an open-ended mutual fund are 3. high growth with risk
bought
4. long term capital appreciation
1. on a stock exchange
2. from the fund itself 18. In which of the following do debt funds not
invest
3. from AMFI
1. government debt instruments
4. from a stock broker
2. corporate paper
12. A mutual fund is not 3. financial institutions' bonds
1. owned jointly by all investors 4. equity of private companies
2. a company that manages investment
portfolios of high networth individuals 19. Which of the following risks do not affect a
debt fund
3. a pool of funds used to purchase securities on
behalf of investors 1. default by issuer on payment of interest or
principal
4. a collective investment vehicle
2. price fluctuations of the debt securities
15. Some close-ended funds are quoted at a 3. a fixed term bank deposit
discount to their NAV because
4. a fixed term corporate bond
1. of high expense ratios
2. investors do not expect the current NAV to be 22. NAVs of equity funds are not affected by
sustained in future 1. Stock market movements
3. the repurchase price fixed by the fund in lower
2. Events affecting the industry/sector in which
than the NAV
the fund has invested
4. of the inherent risk involved in investing in
3. Happenings in the companies in which the
such type of funds
fund has invested
16. The NAV of each scheme should be updated 4. real estate prices
on AMFI's website
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 2/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
2. equity warrants
23. The greatest potential for growth in capital is
offered by 3. ordinary debentures
1. debt funds 4. convertible debentures
2. gilt funds
3. growth funds 30. The drawback of an ordinary share is
1. possibility of capital appreciation
4. balanced funds
2. ownership privilege of the company
24. A Systematic Withdrawal Plan, allows 3. guaranteed dividend income
investors to get back the principal amounts
invested in addition to the income on investment 4. no guaranteed income or security
1. True
31. An owner of preference shares is given which
2. False of the following rights
1. voting rights
25. Which of the following is untrue of an
automatic reinvestment plan? 2. fixed dividend income from post-tax profits
1. The plan allows for automatic reinvestment of 3. voting rights and unlimited dividend income
all income and capital gains
4. no guaranteed rights
2. Automatic reinvestment allows for
accumulation of additional units of the fund
32. Market capitalisation of a company is
3. The major benefit of automatic reinvestment calculated by multiplying the number of
is compounding outstanding shares by
4. The benefit of automatic reinvestment is 1. R.10
often lost on account of the heavy load 2. Face value of each share
charge on the reinvestment
3. Current market value of each share
26. Constraints imposed by most funds on check
writing are: 4. dividend yield
29. Which of the following is not an equity 36. Which of the following is generally true for a
instrument growth stock?
1. preference shares
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 3/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
1. steady capita appreciation and steady management or the controlling interest in the
AMC change
dividends yields
1. True
2. high capital appreciation and high dividend
yields 2. False
3. high capital appreciation but low dividend
yields 44. An AMC cannot explain adverse variations
4. steady capital appreciation but high dividend between expense estimates for the scheme on
offer and actual expenses for past schemes in
yields
1. financial newspapers
37. Shares of companies with large capital market 2. business channels on TV
capitalisation
3. the offer document
1. have greater growth potential
4. AMFI newsletter
2. are more liquid
3. are not available 45. Information on estimated expenses to be
4. none of the above incurred by a scheme is not found in the offer
document, but in brochures of the fund
1. True
38. Dividend yield for a stock is
1. dividend per share 2. False
2. dividend per face value 46. When comparing a fund's performance with
3. dividend per share to current market price that of its peer group, the following cannot be
compared
4. none of the above 1. Two debt funds with 5 year maturities
2. A broad-based equity fund with an IT Sector
39. Value stocks
Fund
1. have high current dividend yield
3. A bond fund with a bond
2. yield high growth in earnings
4. A government securities fund with a
3. are currently under valued government security
4. none of the above
47. An AMC must explain adverse variation
between expense estimates for the scheme on
40. A better performance than the return on offer and actual
index is given by
1. expenses for past schemes in
1. passive fund manager
2. financial newspapers
2. an active fund manager
3. business channels on TV
3. all fund managers
4. offer document
4. non fund manager
5. AMFI Newsletter
41. A change in key personnel especially the fund 48. Information on estimated expenses to be
manager of an AMC does not necessitate a incurred by a scheme is not found in the offer
revision of the offer document document, but in brochures of the fund
1. True 1. True
2. False 2. False
49. The offer document and key information
42. If fresh litigation cases or adjudication memorandum contain financial information for
proceedings are referred by SEBI against the fund 1. all schemes of all mutual funds in the capital
sponsors or a company associated with the
sponsors, then the offer document needs to be market
revised 2. all schemes launched by the particular fund
1. True during the last 3 fiscal years
2. False 3. none of the schemes
4. companies in which investment is proposed
43. The offer document need not be revised if the
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 4/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
g j
50. The functions and responsibilities of the guarantor's ability to meet any shortfalls in the
sponsor, AMC, trustees and custodian of the returns assured under the scheme can be found in
mutual fund are listed in
5. the offer document
1. offer document only
6. the key information memorandum
2. key information memorandum
7. both (a) and (b)
3. both offer document and key information
memorandum 8. none of the above
4. none of the above
57. The names and background of key personnel
51. Information about trusteeship fees is included of the AMC
in the offer document but not in the key
information memorandum 5. need not be disclosed to investors
5. True 6. are of no relevance as they may change
6. False 7. are disclosed in the offer document
8. are declared in newspaper advertisements
52. The following information about the
constitution of the mutual fund is found in both
the offer document and key information 58. The minimum amount to be raised, and the
memorandum maximum target amount
5. activities of the sponsor 5. are not known before the offer is concluded
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 6/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
8. if AMFI approves
75. Investors' rights under a scheme are
5. uniform for all schemes of all funds
83. Who among the following are not Institutional
6. not defined Investors
81. The most important link between Mutual Fund 5. SEBI Regulations Manual
and Investors is 6. AMFI booklet
5. Government
7. Offer document
6. SEBI 8. RBI Guidelines
7. Fund distributors
8. AMFI 89. As per AMFI figures, how many agents
approximately, are there in India selling Mutual
Funds
82. Are Overseas Corporate Bodies allowed to 5. 50000
invest in Mutual Funds
5. No 6. 100000
6. Yes 7. 75000
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 7/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
7. False
90. Which Mutual Fund has majority of the agents
selling its Mutual Fund units in India
5. LIC Mutual Fund 98. The following need not be covered in a Key
Information Memorandum
6. UTI Mutual Fund 3. Risk Factors
7. SBI Mutual Fund 4. Opening, Closing and earliest Closing Date of
8. None of the above the offer
5. Disclaimer Clause
91. Mutual Fund agents/distributors are not 6. Functions and responsibilities of the sponsor,
allowed to sell Financial Products other than
Mutual Funds trustees, AMC and Custodian responsibilities
3. True
99. The front page of an offer document need not
4. False cover
5. opening, closing and earliest closing date of
92. Are Mutual Fund agents/distributors in India the offer
required to pass any examination to qualify to sell 6. disclaimer clause
Mutual Fund Units
3. Yes, a test conducted by AMFI 7. legal and regulator compliance
5. No
100. A "glossary" of Defined Terms must be
6. a Post Graduate university course included in the offer document
5. True
93. How many major distributor Companies are 6. False
there in India selling Mutual Fund units
3. approximately 9
4. approximately 11 101. Standard risk factors are not
4. False
103. Past performance of a sponsor/AMC mutual
fund is not indicative of the future performance of
96. The legal responsibility for the accuracy of the the scheme. This is
statements made in the offer document lies with 9. not true
5. SEBI
10. a standard risk factor for all schemes
6. the AMC
11. a scheme-specific risk factor
7. AMFI
12. applicable only to gilt funds
8. the Company Law Board
104. Risk arising from a scheme's investment
97. Though the offer document of a scheme is objective/strategy and proposed asset allocation is
prepared as per SEBI Regulations and is filed with 9. not present
SEBI, SEBI does not certify the accuracy or
adequacy of the document 10. common to all schemes
6. True 11. specific to that scheme
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 8/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
121. To cover fund distribution expenses, open 128. SEBI's advertising code mandate that all
ended funds performance calculations in a fund's
7. charge a fee from agents advertisement should be based
7. NAV
8. charge entry and exit loads from investors
8. the NSE Fifty Index
9. create a reserve
9. the BSE Sensex
10. sell investments
10. none of the above
122. Trail commission means paying
9. no commission at all 129. An agent's appointment by a fund
9. requires SEBI's approval
10. the entire commission up-front
10. is a lengthy and cumbersome process
11. part of the commission up-front and the
balance in phases 11. is mandatorily preceded by an AMFI test
12. the entire commission after five years 12. does not require any approval
123. Sub-brokers serve as agents of the principal 130. An investor does not have recourse to his
broker and a mutual fund is not answerable for agent in case of errors, problems or the quality of
their activities the investment
9. True 3. True
10. False 4. False
124. In India, Mutual fund agents' rate and services 131. An agent can offer and sell a funds's units at
are at present defined by
9. any price he chooses
7. SEBI rules
10. a price determined by competition among
8. stock exchange bye-laws agents
9. AMFI rules 11. a price based on demand for that fund's units
10. convention 12. the public offering price currently in effect
125. Along with the application, it is mandatory to 132. All buy orders through an agent do not
distribute become valid till the fund accepts and confirms
9. investment rebate the orders
9. True
10. offer document
10. False
11. key information memorandum
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 10/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
162. A transfer in the management of a close- 169. The role of an AMC is to act as
ended scheme does not require the consent of
11. unit holders with 75% voting rights 1. promoters
2. investment managers
12. SEBI
13. Trustees 3. distribution agents
4. regulators
14. AMC
13. atleast 40% of the AMC's networth 14. Trustees of the fund
165. Issuing and redeeming units of a mutual fund 14. none of the above
is the role
13. the custodian 172. As per SEBI's principles, the AMC and the
Board of Trustees of a fund should belong to the
14. the transfer agent same sponsors
15. the trustees 13. True
16. the bankers 14. False
166. The fund sponsors should have a sound 173. After UTI, the first mutual funds were started
financial track record of by
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 13/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
179. For a close-ended scheme to change its 186. The amount of authority enjoyed by a
fundamental attributes, it must obtain the
consent of 1. self-regulatory organisation is defined by
13. 50% of unit holders 2. the apex regulatory authority
14. 50% of trustees 3. company law board
15. 75% of unit holders
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 14/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
11. receiving of a copy of the annual financial 13. jointly by SEBI & RBI
statements of that fund 14. AMFI
12. approving investment decisions of the fund
199. Investor does not have the right to receive
192. Shortfalls in the case of assured returns any interest from an AMC if his redemption
schemes are met proceeds are not despatched within 10 working
days
11. by sponsors of such schemes
13. True
12. only if the offer document specifically
provided such a guarantee by a named 14. False
sponsor
13. the Government of India 200. If an investor failed to claim his redemption
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 15/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
proceeds within 3 years, he can claim the 19. include the terms of the scheme
proceeds at
11. Par 20. are not necessary for deciding whether to
invest in the scheme or not
12. Prevailing NAV
13. the on the date he has applied for redemption 207. The offer document
14. 15% below the prevailing NAV 17. contains the terms of issue
18. gives no information relevant for making an
201. After closure of the initial offer an open
ended scheme, on going sales and repurchases investment decision
must start within 19. is not the operating document describing the
15. One week scheme
16. 30 days 20. cannot be called a reference document
17. 45 days
208. SEBI does not require the following to be
18. 180 days included in the offer document issued by a
mutual fund
202. For scheme to be able to change its 17. details of the Sponsor and the AMC
fundamental attributes, it must obtain the 18. Description of the Scheme & investment
consent of
objective/strategy
15. 50% of the unit holders
19. Investors' Rights and Services
16. 50% of the trustees
20. Performance of other mutual funds
17. 75% of the unit holders
18. none of the above 209. 'Key Information Memorandum' is
15. an abridged version of the offer document
203. The prospectus or Offer Document 16. the Memorandum & Articles of Association of
containing the details of new scheme is first
registered with the the AMC
17. AMFI 17. a sheet containing historical NAVs of other
fund schemes
18. SEBI
18. Annual Report of the AMC
19. Bombay Stock Exchange
20. Ministry of Finance 210. The offer document for a scheme remains
valid even if
204. The offer document issued by mutual funds 17. the AMC is reconstituted
does not serve the purpose of 18. entry or exit load are changed
17. announcing the scheme
19. the scheme's NAV changes
18. giving detailed information about the scheme
20. new plans are added to existing schemes
19. inviting the the investors
20. giving the fund manager's investment outlook 211. The offer document has to be fully revised
for the next quarter and updated
17. every six months
205. The prospectus of a close-ended fund is 18. once in two years
issued
15. every year 19. every quarter
218 The offer document is not a legal document 226 A fund manager managing an index fund
15. True 15. has to keep fund expenses low
16. False 16. does not have to research stocks
219 Initial issue expenses are charged to a scheme 17. does not have to balance his portfolio
in the first year itself 18. none of the above
13. True
14. False 227 A growth manager looks for
17. high current income
220 Scheme-wise annual report of a mutual fund 18. undervalued stocks
need not be
17. sent to all unit-holders 19. above average earnings growth
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 17/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
244. Debt securities bought at a discount to their 251. Government securities are issued through the
face value are generally RBI
13. interest bearing 19. True
14. a fixed rate plus a variable portion 22. floating rate method
247. In the wholesale debt market, the largest 254. Which of the following do not represent the
proportion of trading is seen in amount an investor of a debt security will be paid
upon maturity
1. Government Securities
21. par value
2. Corporate Bonds
22. face value
3. T-Bills
23. fair value
4. PSU Bonds
24. redemption value
17. Indian banks 21. the amount rate of interest paid on par value
of the bond
18. financial institutions
22. none of the above
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 19/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
258. A call provision in a debt issue allows the 265. It may not be possible to reinvest interest
issuer to received at the same rate as principal. This is
21. call out the names of the investors known as
22. redeem the debt on maturity 19. reinvestment risk
260. Current yield relates interest on a security to 267. If a bond cannot be sold at a price near its
21. its current market price value, it means that investment in this bond has
22. its face value 19. high liquidity risk
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 20/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
19. technicians
292. The most suitable measure of fund
20. statisticians performance for all fund types is
21. economists & econometricians 19. NAV Change
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 22/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
302. Turnover rates would be most relevant to 309. The choice of an appropriate benchmark for
analyse the performance of evaluating a fund's performance depends on
303. Transaction costs include 310. An actively managed equity fund expects to
25. all expenses related to trading 25. be able to beat the benchmarks
26. all expenes charged to the fund 26. earn the same returns as the benchmark
28. none of the above 28. underperform when compared with the
benchmark
304. Which of the following are not included in 311. For evaluating funds, the preferred benchmark
Transaction costs? would be the
25. brokerage commissions 25. BSE Sensex
26. stamp duty on transfers 26. S&P CNX Nifty
27. custodians fees 27. BSE 200
28. agent commissions 28. S&P CNX Sectoral Indices
305. Which of the following transaction costs are 312. To evaluate a close-ended debt-fund, a
not quantified in the offer document suitable benchmark would be
23. brokerage commissions 19. BSE Sensex
24. dealer spreads 20. I-Sec's I-BEX
25. custodian's fees
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 23/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
318. Financial plans do not alter in any way the 326 Financial planning is primarily tax planning
amount of tax an investor pays as the tax is on his
income 23. True
21. True 24. False
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 24/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 25/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 26/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
28. sum assured 362. Gold and real estate are attractive
29. face value investment options only in high inflation
economies
30. real value 29. True
30. False
356. Dividends distributed by mutual funds are
27. taxed at source
363. Direct investment in stock market can be a
28. taxed in the hands of the investors better option than investing through mutual
funds if the investor
29. are subject to capital gains tax
23. wants better returns than those offered by
30. are tax-free in the hands of the investor mutual funds
24. has large capital, knowledge and resources
357. Investing through mutual fund is a better for research
option than investing directly in the stock
market because 25. has identified a bullish phase in the stock
market
identifying stocks is a difficult process 26. wants to invest for the long term
agents get commissions on mutual fund investme
returned are guaranteed by mutual funds 364. Deciding on strategies such as long-term
all of the above compounding, cost averaging, value averaging,
active switching, all depend on the
27. stock market situation on date
358. A small investor can build a diversified
portfolio by 28. amount of money to be invested
27. buying one share each of all listed 29. investor's risk tolerance
companies
30. phase through which the economy is
28. investing in a mutual fund passing
29. borrowing enough money to buy shares of
well-managed companies 365. Financial Planning involves
30. none of the above 27. studying financial management
28. managing the risks of investing
359. Which of the following is not an advantage
of mutual fund investment over direct 29. financing the client's investments
investment
30. none of the above
29. Higher liquidity
30. Lower transaction costs 366. Greater returns come only from assuring
higher risks, and a higher risk portfolio
31. Greater convenience guarantees higher returns
32. guaranteed returns 23. True
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 27/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
23. True
378. Diversification reduces
24. False
27. company specific risk
371. By their very nature, growth funds are 28. market level risk
considered as high risk funds 29. both of the above
27. True
30. none of the above
28. False
379. Which of the following is most risky?
372. Short Term bond funds are 25. Investing in a money market mutual fund
27. low risk funds
26. Investing in an index fund
28. moderate risk funds
27. Short term investment in an equity fund
29. high risk
28. Long term investment in an equity fund
30. of the above depending on the market
380. A fund with a high beta coefficient gives
373. The risk level of commodity funds is greater returns in a rising market, and is more
risky in a falling market
25. high risk category
27. True
26. determined by the commodity price
movements 28. False
27. cannot be specified
381. Which of the following is a disadvantage
28. low risk category of Standard Deviation as a measure of risk
17. Standard Deviation measures total risk, not
374. As compared to a fund with fluctuating just market risk
total returns, a fund with stable positive
earnings 18. It is based on past returns, which does not
necessarily indicate further performance
23. gives higher returns
19. It is an independent number
24. is less risky
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 28/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
20. All types of funds can be measured with 27. Equity Funds
standard deviation
28. Index Funds
382. The role of an agent is to 29. Money Market Funds
27. point out the features and benefits of 30. Sector Funds
various investments options
28. help the investor develop the right approach 389. A retired person generally needs a greater
to investing proportion of
29. recommend some investment option 27. Debt funds
available 28. Equity funds
30. offer ad hoc advise whenever the investor
29. Money Market funds
has surplus money available
30. All of the above
383. One of the most effective ways to invest
through mutual funds is to 390. To satisfy a young investor's need for
25. develop a model portfolio growth, a greater proportion of investment
should be advised in
26. buy a few units of every mutual fund
27. Gilt funds
scheme available
27. invest all the money in one fund scheme 28. Income Funds
28. invest all the money in different schemes of 29. Equity Growth funds
the same fund family 30. Liquid funds
384. Mutual fund should be advised to expect 391. A very high proportion of investment in all
29. low post tax returns types of equity funds is advisable for investors
30. dramatic results 29. in distribution phase
31. better returns than every other available 30. in accumulation phase
option 31. in transition phase
32. only realistic wealth accumulation goals 32. who are wealth preserving affluent
individuals
385. Asset Allocation is
27. keeping certificates of the physical 392. The transition phase of an investor's
securities in proper places wealth cycle is when
28. allocation the available money to all the 25. the financial goals have been already met
securities available 26. the investor has retired
29. allocating the right proportion of funds to 27. financial goals are approaching
equity, debt and money market securities
30. none of the above 28. investor suddenly gets a windfall
386. Once a financial advisor works out ideal 393. A high proportion of investment in income
Asset Allocation, it can be used for all investors funds is required by
whom he/she advises 27. accumulating investors
27. True 28. affluent investors
28. False 29. investors in the inter-generational transfer
phase
387. Asset distribution among equity, debt and 30. investors in the distribution phase
money market securities should correspond to
the investors' need for capital growth, income
and liquidity 394. Retired investors should
21. True 25. not draw down on their capital
22. False 26. not invest in securities which bear risk of
capital erosion
388. The liquidity needs of an investor are met 27. continue holding a major portion of their
through holding in equity growth funds
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 29/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
28. never invest in equity redeems his units from the fund is known as
31. recovery charge
395. For older investors who want to transfer 32. repurchase load
their wealth
25. no financial planning is required 33. redemption weight
26. the right investment strategy depends upon 34. exit load
who the beneficiaries are
27. the right investment strategy depends upon 403. The load amount charged to a scheme over
a period of time is called
the state of the stock market
33. entry load
28. all the funds can be invested in aggressive
equity funds 34. exit load
35. deferred load
396. Investors who acquire sudden wealth
36. no-load
23. can speculate with all the acquired money in
the stock markets
404. Contingent Deferred Sales Charge (CDSC)
24. should not use any of the new wealth to
invest in equity 33. is higher for investors who stay invested in the
scheme longer
25. should take the effect of taxes into account
34. is lower for investors who stay invested in the
26. need not pay any taxes on the newly scheme longer
acquired wealth as it is not a part of their
regular income 35. is the same for all investors irrespective of how
long they stay invested
397. Only if a specialty offshore fund has 36. is not allowed to be charged to mutual fund
consistently given very good performance, it investors in India
can be considered for investment by a retiree
25. True 405 A fund's declared NAV does not include loads
26. False 31. True
32. False
398. Past performance should not be solely
relied on for selecting a fund
406. Which of the following fund types are
24. True comparable
25. False 31. An aggressive equity fund and a money
market mutual fund
399. Between the past performance of a fund 32. A value fund and a government securities fund
and its suitability for an investor, past
performance is more important 33. A bond fund and a debt fund
27. True 34. A diversified equity fund and a debt fund
28. False
407. Who is the primary guardian of unitholders'
funds/assets
400. Structural characterisations of an equity
fund include 31. The AMC
27. costs of investing 32. The Trustees
28. the specific securities in which the fund has 33. The Registrars
invested 34. The custodians
29. the number of employees of the AMC
30. all of the above 408. In case of a fund merger or Take-over
401. An equity fund's age and size are irrelevant 33. High Court approval may not be necessary
when selecting a fund for investment
34. SEBI approval is a must
29. True
35. all unitholders must be informed
30. False
36. all of the above
412. The size of the market capitalisation of a 419. Debt schemes are popular because
fund's equity holdings is inversely proportional to 25. the Indian Stock Market is always going down
the returns that
26. the returns are more predictable
27. can be expected from the fund
27. most investors are always in debt
28. level of risk assumed by the fund
28. all of the above
29. state of the stock market
30. all of the above 420. Yield-to-maturity of a debt fund's portfolio is
more important when the investment objective is
413. A steady holding of investments in an equity 29. current income
fund's portfolio indicates
30. total return
31. long-term orientation
31. liquidity
32. lower transaction costs
32. all of the above
33. both the above
34. none of the above 421. Compared to equity funds, income margins
for debt funds are
414. Ex-Mark of an equity fund measures its 31. narrow
31. performance 32. higher
32. risk 33. the same
33. both the above 34. almost nil
34. none of the above
422. Debt funds with long-term investments carry
415. Beta of an equity fund measures its higher risk of capital loss
425. All debt fund investors are exposed to risk of 432. An application form for investment in a
principal loss mutual fund is available with
31. True 29. the offer document
32. False 30. the abridged annual report
31. the key information memorandum
426. Running a money market mutual fund
requires more of 32. a bank challan
29. credit analysis skills
433. An aggrieved unit-holder of a mutual fund
30. equity analysis skills can sue
31. patience 33. the AMC
32. trading skills 34. the trustees
35. the sponsor if returns have been guaranteed
427. Which is the most important in selecting by them
debt fund for better return
36. none of the above
31. past performance
32. level of interest rates 434. As per SEBI regulations for valuation of
33. fund expertise investments held by mutual funds, a security is
considered "non-traded" when it
34. the securities in which it has invested 31. has not been traded for 60 days prior to
valuation
428. Investors should be advised to avoid 32. has not been traded for 30 days prior to
investing in a debt fund with a
valuation
29. lower rated portfolio and higher expense ratio
33. is not listed on any stock exchange
30. higher rated portfolio and lower expense ratio
34. is held by the mutual fund without buying or
31. lower rated portfolio and lower expense ratio selling
32. lower rated portfolio and higher expense ratio
435. An Ex-Mark of 100% is possible for
429. An ideal money market mutual fund must 29. a growth fund
have 30. an aggressive growth fund
29. lower returns
31. an index fund
30. lower expense ratio
32. a balanced fund
31. low quality of investments
32. all the above 436. A trail commission is justified when
23. an investor cancels his investment
430. Circumstances that might cause an investor 24. the investor redeems his investment in a very
to change the composition of his portfolio
short time
21. cyclical changes in economy
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 32/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
25. an agent invests his own money, not that of a 33. has its sale and repurchase price declared
client periodicaly by UTI
26. an agent sells many mutual funds 34. has its price determined by market forces
437. Of the following, which type of fund would 443. The Indian debt market
have a higher P/E multiple in comparison to the
average market multiple 29. is Wholesale in nature
31. A Value Fund 30. comprises large players like financial
institutions and banks
32. A Growth Fund
31. witnesses large scale trading in government
33. An Index Fund securities
34. Could be any of the above three, one cannot 32. all of the above
generalise
444. A fund that charges a load is better than a
438. Which of the following is not true as per SEBI no-load fund
Regulations for Debt Funds?
29. True
31. Investment in rated debt securities of a single
issuer should not exceed 15% of NAV 30. False
32. Total investment in unrated debt securities of
a single issuer should not exceed 25% of NAV 445. An AMC can approach investors either
directly or with the help of
33. Total investment in unrated debt securities
27. individual agents
below investment grade should not exceed
25% of NAV 28. banks and non-banking finance companies
34. Total investment in rated debt securities below 29. distribution companies
investment grade should not exceed 25% of
NAV 30. all of the above
439. A Money Market Mutual Fund is most likely 446. Which of the following is true for Equity
to invest in Linked Savings Scheme (ELSS)
31. Corporate Bonds 27. A tax rebate is available to investors in these
32. Equity Shares schemes
28. The investment has to be locked in for 3 years
33. Government Securities with maturity less than
1 year 29. The minimum amount for investment is fixed
34. All of the above 30. All of the above
440. Of the following, which would be suitable for 447. A prospective investor
a retiree with a modest risk appetite
26. has the same status as a unit-holder of a fund
33. Value Fund
27. can sue the AMC/trustee
34. Diversified Equity Fund
28. has no legal recourse
35. Growth Fund
29. all of the above
36. Balanced Fund
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 33/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
g g g
32. False would never
37. describe the past performance of the scheme
450. An exit load guarantees a higher return 38. compare the fund with other mutual funds
27. True 39. assure a rate of return
28. False 40. compare the fund with other financial
451 Bonds held in the portfolio of a mutual fund products
are valued at yield to maturity
31. True 459. An investor buys one unit of a fund at an
NAV of Rs.20. He receives a dividend of Rs.3
32. False when the NAV is Rs.21. The unit is redeemed at an
NAV of Rs.22. Total Return is
452 The Valuation of non-traded equity shares is 31. 25.71%
done at the trading price 30 days prior to
valuation date 32. Rs.27.51
35. True 33. 21.27%
36. False 34. Rs.21.75
453 If a unit-holder does not agree to the merger 460. A fund sells 100 units of face value Rs.10/-
of his fund with another, he has not exit option at an NAV of Rs.12.25. How much would be
credited to unit capital?
37. True
35. Rs.1225
38. False
36. Rs.225
454. The most important factor look for when 37. Rs.1000
investing in a corporate fixed deposit is the
38. none of the above
37. yield
38. rate of interest 461. When a scheme with assured returns is being
launched, which of the following need not be
39. credit rating of the deposit published in the offer document?
40. none of the above 35. Means of fulfilling the guarantee
36. Information for all schemes launched by the
455. The most important reason for an investor to fund in the past
prefer a bank deposit to a mutual fund is
37. comparison with other mutual funds
33. the credit worthiness of the bank
38. Investment objective
34. because the bank does not invest in securities
35. that the bank offers a guarantee 462. Mutual fund units can be distributed by
36. all of the above 31. trustees of the fund
32. the AMC
456. A deep discount bond
33. Non-banking finance companies
35. is always sold at a discount to its issue price
34. banks
36. bears interest annually
37. is redeemed at a price much higher than issue 463. A debt fund distributes 10% dividend. How
price much tax does the investor have to pay on this
38. bears interest at varying interests dividend?
35. 10%
457. A mutual fund in India is a 36. 12%
35. body corporate 37. 20%
36. company 38. None
37. trust
38. an asset management company 464. A debt fund distributes a 10% dividend. How
much tax does the fund have to pay?
35. 10%
458. When selling a mutual fund, a good agent
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 34/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
467. Why should one buy an insurance policy? 31. his capital base is large
33. It gives high current returns 32. he is able to carry out detailed investment
research and monitor the stock market
34. It gives good capital appreciation over its term
33. both the above
35. It should be bought due to the need for
insurance and not as an investment 34. none of the above
30. 1996
475. Which of the following is a disadvantage
suffered by a mutual fund investor?
469. Expenses incurred by a fund for printing of 33. High liquidity
Key Information Memorandum can be amortised
over 34. diversification
29. 10 Yrs
35. no tailor made portfolio
30. 5 Yrs
36. low investment
31. 15 Yrs
32. Cannot be amortised 476. A disadvantage suffered by mutual fund
investor is that he has no control over the costs of
investing
470. A mutual funds' investments are guided by 33. True
the
33. AMC 34. False
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 35/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
38. It was not given a monopoly status 36. 2% - 4% of gross domestic savings
37. 7% - 10% of gross domestic savings
478. Which scheme has the largest investor base?
38. 25% - 40% of gross domestic savings
33. ULIP
34. UTI Mastershare 485. Which of the following about Public
Providend Fund (PPF) are untrue
35. US-64
33. 50% of the balance of the 4th year can be
36. SBI Magnum withdrawn in the 7th year
34. The interest is tax free
479. Which was the first diversified equity
investment scheme in India 35. The rate of interest is 12% p.a.
33. SBI Magnum 36. contributions upto Rs.60000 are eligible for
34. UTI Mastershare tax rebate
38. Indian Bank MF 38. The name and address of the compliance
officer
482. The organisation responsible for a
comprehensive set of regulations for all mutual 488. Offer Document of a mutual fund is
funds in India is 35. required by investors
33. RBI
36. required by the AMC for its own reference
34. SEBI
37. required as per SEBI regulations
35. AMFI
38. not mandatory as per SEBI
36. SHCIL
489. The units of a scheme being sold and
483. The 1999 Union Government Budget helped repurchases as per the procedure laid down is one
the Mutual Fund industry by of the fundamental attributes of a scheme
37. regulating the industry practices 35. True
40. selection of fund managers and schemes, 34. Gross dividend yield 12%, Beta 1.2, Ex-Marks
sector selection, asset classification 80
491. Compounding of interest is best explained by 496. A mainstream diversified debt fund is most
a affected by
33. balanced fund 31. reinvestment risk
34. growth fund 32. liquidity risk
35. value fund 33. interest rate risk
36. income fund 34. default risk
492. From whom can a unit-holder seek redressal 497. If yields fall, a debt fund manager will do all
if his complaint is not entertained by the mutual of the following except
fund
30. sell short maturity securities and buy long
35. AMC maturity securities
36. Board of Trustees 31. see that the fund's average duration becomes
longer than the market's average duration
37. SEBI
32. sell long duration securities and buy short
38. RBI duration securities
33. sell high coupon securities and buy low
493. An investor wishes to switch between a coupon securities
money market mutual fund and an equity fund.
What would you advise him?
498. In which type of schemes should an
33. It would be better to stick to one type of fund, unmarried professional working HLL invest
the one that meets his investment objective.
33. Scheme investing 80% in debt securities
34. He should keep switching parts of his
investment from the equity fund to the 34. 50% in equity funds and 50% in income
money market fund as the market rises and funds
switch back to the equity fund when the 35. 90% in equity funds having a higher P/E Ratio
market falls
than the market
35. He should switch from the money market fund
to the equity fund in a rising market and switch 36. all the money in a balanced fund
back to money market fund when the market
falls 499. An investor buys units in a fund that has
36. none of the above given excellent returns in the past, but his
expectations are not met as the fund does not
perform well this year. The investor can
494. For choosing an appropriate benchmark to
measure a scheme's performance, all of the 33. sue the AMC
following are required except 34. sue the Trustees
31. the composition and size of the portfolio
35. sue the agent
32. the investment objective
36. none of the above
33. historical data of fund performance
34. the nature of investments 500. A fund's investments at market value total
Rs.700 crores, Total liabilities stand at Rs.50 lacs
and the number of units outstanding is Rs.28
495. Which of the following characterise the fund Crores. What is the NAV
that a risk averse investor should choose
29. Rs.30.19
31. Gross dividend yield 15% Beta 1.5, Ex-Marks
90 30. Rs.24.98
32. Gross dividend Neil 10%, Beta 1, Ex-Marks 70 31. Rs.32.15
33. Gross dividend yield 11%, Beta 0.9, Ex-Marks 32. Rs.40.49
80
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 37/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 38/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
An An An An
Q. No Q. No Q. No Q. No Q. No Ans
s s s s
251 a 301 a 351 b 401 b 451 a
252 b 302 a 352 a 402 c 452 b
253 d 303 a 353 d 403 c 453 b
254 c 304 d 354 b 404 b 454 c
255 c 305 b 355 b 405 a 455 a
256 a 306 b 356 d 406 c 456 c
257 a 307 d 357 a 407 c 457 c
258 d 308 d 358 b 408 d 458 c
259 b 309 b 359 d 409 d 459 a
260 a 310 a 360 b 410 a 460 c
261 c 311 d 361 d 411 c 461 c
262 b 312 c 362 a 412 b 462 d
263 b 313 d 363 b 413 c 463 d
264 c 314 d 364 c 414 a 464 c
265 a 315 c 365 b 415 b 465 d
266 b 316 b 366 b 416 a 466 a
267 a 317 b 367 c 417 a 467 c
268 b 318 b 368 c 418 a 468 d
269 a 319 b 369 b 419 b 469 b
270 d 320 a 370 a 420 b 470 c
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 39/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
Share:
Related Posts:
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 40/41
9/4/2018 NISM - 500 Question Bank - VA Series ~ NISM & MARKET NEWS
2 comments:
Needed to put you one little observation so as to thank you as before about the striking
opinions you've featured on this page. It has been simply shockingly open-handed with you to
make freely precisely what many individuals would have sold for an e book to end up making
some profit for their own end, especially seeing that you might well have tried it if you
considered necessary. ειδησεισ ελλαδασ τωρα
Reply
good
Reply
http://onlinenism.blogspot.com/2017/02/nism-500-question-bank-va-series.html 41/41