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TEST 1 - Correct answers are shown in Green. Attempted answers, if

wrong, are in Red
Q. 1) A mutual fund distributor is paid commission for..
A)

First 5 years of Investment done by investor

B)

First 3 years of Investment done by investor

C)

First 10 years of investment done by investor

D)

As long as investor held the investment

Q. 2) The guideline issued by AMFI for intermediaries are known as...

A)

AGNI

B)

ACE

C)

AMFI

D)

none of above

Q. 3) The investment in MF portfolio are valued at

A)

Face value of portfolio

B)

cost of investment

C)

Market value of portfolio

D)

Book value of portfolio

Q. 4) Exit loads are generally lower for large investors.

A)

TRUE

B)

False

Q. 5) Time stamping arrangement is must at..

A)

Offices of distributors

B)

AMC offices

C)

Bank distributor's branch

D)

Offices declared as point of acceptance.

Q. 6) SEBI has put a stop on charging ____________ to the scheme.

A)

Exit load

B)

Entry Load

C)

Recurring Expenses

D)

CDSC

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Q. 7) Unaudited accounts of the scheme must be published
A)

through monthly fact sheet T

B)

Only at AMFI website

C)

Once every six month in one national & Regional news paper

D)

Only on AMC's website

Q. 8) Capital gain or loss from mutual fund investment are classified

as a short term investment are if sold within
A)

9months

B)

6 months

C)

12 months

D)

13 months

Q. 9) An investor invested Rs.100000/in a 370 day FMP and got Rs.

107750/-, what is capital gain in this case?
A)

7750

B)

750

C)

Insufficient details

D)

10% Plus surcharge or 20% after index benefit

Q. 10) Which of the following is true

A)

STT is payable when investor purchase equity MF

B)

STT is payable when investor does redemption from equity MF

C)

STT is payable when investor purchase debt MF

D)

STT is payable when investor sale debt MF

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Q. 11) Liquid funds can not charge management fees of funds parked [1
in a short term bank deposits.
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A)

TRUE

B)

FALSE

Q. 12) STT is charged on

A)

Equity share trading

B)

Derivatives trading

C)

Equity MF

D)

All of the above

Q. 13) Which of the following is not required for KYC norms.

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A)

Proof of investment

B)

Proof of Identity

C)

Proof of address

D)

All of the above

Q. 14) The information on minimum investment amount, investor's

service centers, and how to make purchase is provided in.
A)

Application form

B)

Nomination Form

C)

KIM

D)

None of the above

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Q. 15) Which of the following document is not require to be submitted [1

by charitable trust to invest in MF?
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A)

Trust deed

B)

List of authorized signatories

C)

Board resolution and Memorandum and article of association

D)

certificate of registration

Q. 16) SIP is a good investment strategy because..

A)

Investor gets units at a discount to NAV

B)

It offers benefits of rupee cost averaging

C)

It helps regular income for investor

D)

No load investment done

Q. 17) Relaxation from documentation requirements for micro SIP is

available for..
A)

HUF

B)

Non Individual

C)

NRI

D)

PIO

Q. 18) NRI can not make repartition investment in MF using demand

draft.
A)

TRUE

B)

FALSE

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Q. 19) An investor plans to invest Rs.12000 in a scheme whose NAV is [1

12 and FV is 10, how many units is he likely to be obtained.
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A)

<1000

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B)

1000

C)

1200

D)

cant say

Q. 20) An investor is doing a liquid investment, fund is available and

time is 12.30. NAV would be applicable for the ________

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A)

Next working day

B)

Same day

C)

Closing NAV of Day immediately preceding the date of application

D)

Closing NAV of Day immediately preceding next business day

Q. 21) Investor invest 50 lakh in GILT at 3.30 pm with a local cheque.

he gets NAV of
A)

Closing NAV of day fund are available

B)

Same day

C)

Next business day

D)

Next preceding day.

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Q. 22) Time stamping needs to start with serial no 1 on every business [1

day.
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A)

TRUE

B)

FALSE

Q. 23) Funds pay dividend in

A)

Dividend Option

B)

Dividend Re-Investment option

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D)

Growth option

Q. 24) Offering for repurchase, constant amounts worth of units at

regular interval basis is called
A)

SIP

B)

STP

C)

SWP

D)

Value investment

Q. 25) A company's PE ratio may be low because it is unlikely to

replicate it's past performance
A)

TRUE

B)

FALSE

Q. 26) Fundamental analysts are called "Chartists"

A)

TRUE

B)

FALSE

Q. 27) If absolute return was 2.4% over 50 days, annualized return

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would be____________
A)

0.05

B)

0.024

C)

1.20

D)

0.175

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Q. 28) In case of liquid fund, investment less than 3 months old. which [1
return would be calculated?
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A)

Total return

B)

CAGR

C)

Absolute return

D)

Simple annualized

Q. 29) In case of equity fund, if fund has higher allocation to cash in

bullish market the performance is likely to..
A)

Be comparable to that of benchmark index

B)

Be worse than benchmark return

C)

Better than benchmark return

D)

cant say

Q. 30) CRISIL's indicator for highest safety in a debenture is

A)

AAA

B)

High

C)

Good

D)

P1+

Q. 31) During the period of turmoil, gold prices

A)

Go down

B)

Go up

C)

Remain steady

D)

Mirror equities

Q. 32) Performance of fund must always be measured relative to the.

A)

Index

B)

Benchmark

C)

Asset Class

D)

Investment objective

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Q. 33) Difference between scheme's actual return and optimal return
for it's risk is
A)

Sharpe

B)

Treynor

C)

Alpha

D)

Spread

Q. 34) While evaluating return for an index fund across a peer group,
which of the following is more important?
A)

BETA Coefficient

B)

Past performance

C)

Tracking error

D)

R-squared

Q. 35) Balance funds are for

A)

Aggressive investors

B)

highly aggressive investor

C)

Moderate conservative

D)

Highly conservative

Q. 36) The lower risk among equity fund is

A)

Index Fund

B)

Value Fund

C)

Dividend yield fund

D)

Growth fund

Q. 37) Probabilities of losing money in equity is negligible if

investment horizon is for at least
A)

6 months

B)

5 years

C)

1 years

D)

3 years

Q. 38) Returns in international fund is dependent on

A)

Exchange rates

B)

Asset class performance

C)

Both of the above

D)

None of the above

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Q. 39) Mutual funds in India are not permitted to invest in

A)

Gold

B)

Real estate

C)

Art

D)

Secularized debt

Q. 40) A value fund is expected to have ________ exposure to front

line stocks
A)

Entire

B)

High

C)

Half of it's

D)

Low

Q. 41) Index funds are safer because their NAV does not go down
A)

TRUE

B)

FALSE

Q. 42) Which of the followings are least comparable

A)

Liquid and Savings account

B)

Liquid and Current account

C)

ETF and Index fund

D)

GILT and Sector fund

Q. 43) An investor seeking capital appreciation, having high risk

tolerance and long term horizon must invest in
A)

Bonds

B)

Bank FD

C)

Real-Estate

D)

PPF

Q. 44) Credit rating enables an investors to judge the

A)

Duration of loan

B)

Extent of securities against the borrowing

C)

Risk of default by borrower

D)

Interest rate risk

Q. 45) Which of the following is not government saving scheme?

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A)

Infrastructure Bonds

B)

RBI Bonds

C)

POST

D)

KVP

Q. 46) An investor looking for capital appreciation, having a high risk

tolerance and long tem horizon must invest in
A)

Bank FD

B)

Equity

C)

Bonds

D)

Gold

Q. 47) Which of the followings is physical asset?

A)

Securised debt

B)

Real estate

C)

Real estate fund

D)

Gold future

Q. 48) In new pension scheme(NPS) Tier I account new pension

scheme is called pension account
A)

TRUE

B)

FALSE

Q. 49) Investor in MF can choose asset class but not investment

manager
A)

TRUE

B)

FALSE

Q. 50) Financial Planning Involves

A)

Helping client to select the out performing stock

B)

Assessing the clients financial information

C)

Advising client to invest only in secured investments

D)

None of the above

Q. 51) Value stocks

A)

Have high current dividend

B)

Yield high growth in earning

C)

Are currently under valued

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D)

None of the above

Q. 52) A better performance than the return on index is given by

A)

Passive fund manager

B)

An active fund manager

C)

All fund managers

D)

Non fund manager

Q. 53) Emerging or new channel for distributors/marketing of mutual

funds in India is
A)

Internet

B)

Stock Exchange

C)

All of the above

D)

None of the above

Q. 54) Trail commission means paying

A)

No commission at all

B)

The entire commission upfront

C)

Part of commission up front and balance in phases

D)

The entire commission after five years

Q. 55) Agents are compensated by mutual funds

A)

Through salaries

B)

Through commission

C)

Through an annual fees

D)

Not in cash but in kind

Q. 56) The fund sponsors should have a sound financial track record
of
A)

7 years

B)

5 years

C)

12 months

D)

3 years

Q. 57) Which of the following are self regulatory organization(SRO)

A)

BSE

B)

SEBI

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C)

AMFI

D)

RBI

Q. 58) Bank owned mutual fund are supervised by

A)

SEBI

B)

Jointly by SEBI & RBI

C)

RBI

D)

AMFI

Q. 59) A passive fund manager

A)

Researches stocks extensively

B)

Does not buy and sell stocks often

C)

Does not have to go through the process of stock selection

D)

Does not have to track stocks

Q. 60) Debt securities bought at a discount to their face value are

generally
A)

Interest bearing

B)

Zero coupon bonds

C)

Paying interest at a floating rate

D)

None of the above

Q. 61) When interest rates rise, bond prices

A)

Also rise

B)

Are not affected

C)

Falls

D)

Fluctuate either up or down

Q. 62) The maturity period of RBI relief bonds is

A)

5 years

B)

7 years

C)

6 years

D)

8 years

Q. 63) A trail commission is justified when

A)

An investor cancels his investment

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B)

The investor redeems his investment in a very short time

C)

An agent invests his own money, not that of client

D)

An Agent retain the Investment

Q. 64) A debt fund distributes 10% dividend . how much tax does the
investor have to pay on this dividend
A)

10.00%

B)

20.00%

C)

12.00%

D)

None

Q. 65) What is the current PPF rate

A)

8.00 Percentage

B)

8.50 Percentage

C)

7.75 Percentage

D)

7.50 Percentage

Q. 66) What is the recurring expense on first 100 cr for equity schemes
A)

2.00 Percentage

B)

1.75 Percentage

C)

2.25 Percentage

D)

2.50 Percentage

Q. 67) Risk adjusted return is measured by

A)

Sharpe ratio

B)

Standard deviation

C)

Treynor ratio

D)

A&C

Q. 68) Intra day trading can be done on the basis ofA)

Fundamental analysis

B)

Technical analysis

C)

Economic analysis

D)

Political analysis

Q. 69) Mid cap stocks are risky in the time of

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A)

Boom

B)

Recession/Economic turmoil

C)

Political instability

D)

All of the above

Q. 70) Who Appoints the AMC

A)

Custodian

B)

R&T

C)

Trustee

D)

Distributors

Q. 71) Which of the following has lowest risk

A)

Liquid fund (mmmf)

B)

Gilt funds

C)

Diversified debt fund

D)

Diversified equity fund

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Q. 72) Long term capital gains in a debt fund without indexation for an [1
investor is
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A)

10.00%

B)

15.00%

C)

20.00%

D)

No tax

Q. 73) What of the following is not a reason for investor to prefer

mutual fund over Bank FD
A)

Tax benefits

B)

Possibility of capital gain

C)

Deposit insurance

D)

Investment convenience

Q. 74) In the NPS each investment manager appoints own distributor

A)

TRUE

B)

FALSE

Q. 75) In the NPS each investment manager appoints own distributor

A)

TRUE

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B)

FALSE

Q. 76) Need of Life insurance in life is

A)

Must

B)

Not required

C)

can be done without

D)

None of above

Q. 77) All investor have similar requirements at similar stage in the

life/wealth cycle
A)

TRUE

B)

FALSE

Q. 78) Name of asset allocation strategy if it is fixed @ 50 %

A)

Tactical Allocation

B)

Strategic Allocation

C)

A&B

D)

None of above

Q. 79) Model portfolio should be determined based on commission

income possibility for distributor
A)

TRUE

B)

FALSE

Q. 80) Which of the following is true for model portfolio

A)

Stipulated by SEBI

B)

Guaranteed by AMC

C)

Decided by financial planner

D)

Common across industry

Q. 81) As the no of earning member in a family increases risk appetite

A)

Increases

B)

Decreases

C)

Stays constant

D)

None of above

Q. 82) Equity investment through sip can be suggested for investor

looking for

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A)

Long term growth

B)

Short term target

C)

Portfolio churning

D)

Tax benefit

Q. 83) How to compare index fund

A)

performance

B)

expenses

C)

Tracking error

D)

None of above

Q. 84) What type of bond fund carries least interest rate risk
A)

Short term bonds

B)

Long term Bonds

C)

Mid term Bonds

D)

All of above

Q. 85) Arbitrage fund are not equity fund

A)

TRUE

B)

FALSE

Q. 86) Which of the following is true for FMP

A)

NAV do not fluctuate

B)

Capital Guaranteed

C)

Fixed income

D)

None of above

Q. 87) Index funds are_____________fund

A)

Passive fund

B)

Active fund

C)

Both

D)

None of above

Q. 88) The role of insurance is more critical for physical assets than
financial assets
A)

TRUE

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B)

FALSE

Q. 89) When price of gold goes up a buyer of gold future contract see [1
it's value
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A)

Go up

B)

Go down

C)

Retain the same value

D)

None of above

Q. 90) The investment portfolio is created based on

A)

Market views of fund manager

B)

Investment objective of fund

C)

risk appetite of investor

D)

profile of unit holder

Q. 91) Commodities as an asset class does not include

A)

Food crops

B)

Industrial metals

C)

Real Estate

D)

Gold

Q. 92) Subsequent to NFO, open ended funds are

A)

open for purchase by existing investor & new investor

B)

open for purchase only for existing investor

C)

available on stock market

D)

None of above

Q. 93) If a fund seeks to grow in value overtime it can be said that it's
investment objective is
A)

capital appreciation

B)

safety of capital

C)

Capital adequacy

D)

Regular income

Q. 94) Hybrid funds are invested in

A)

across equity market capitalization

B)

International markets

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C)

both equity and debt

D)

None of above

Q. 95) Mutual fund are constituted in India as

A)

Companies

B)

Trusts

C)

Partnerships

D)

NGO

Q. 96) Mutual Fund sponsor can be compared to

A)

Depositor of a company

B)

Company director

C)

Promoter of Company

D)

CEO of a company

Q. 97) Which of the following is not a function of R&T agent

A)

Creating maintaining and updating the investor record

B)

Updating unit capital of fund

C)

Processing dividends & redemption payouts to investors

D)

Settling investment transaction of the fund

Q. 98) Prior approval of SEBI needs to be taken before a person is

appointed as trustee
A)

TRUE

B)

FALSE

Q. 99) Person, other than Indian residents, should also comply with
RBI guidelines for investment in Indian mutual funds
A)

TRUE

B)

FALSE

Q. 100) The first step of financial planning is

A)

Evaluating the various alternatives

B)

data gathering and goal setting

C)

establishing the client planner relationship

D)

Plan Review

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