Mutual Funds. Pvijaykumar1978.wordpress.com. Test Paper. 1. Units of must be listed on the stock exchange.

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1 Mutual Funds Test Paper 1. Units of must be listed on the stock exchange. a. Sector funds b. Arbitrage funds c. Close ended funds d. Liquid funds 2. Open-ended schemes generally offer exit option to investors through a stock exchange. 3. Sector funds invest in a diverse range of sectors. 4. High yield bond schemes invest in junk bonds. 5. Investment objective is closely linked to. a. Scheme b. Option c. Plan d. SIP 6. The assets of the mutual fund are held by. a. AMC b. Trustees c. Custodian d. Registrar 7. Minimum net worth requirement for a new AMC is. a. Rs. 50 crore b. Rs. 5 crore c. Rs. 4 crore d. Rs. 10 crore 1

2 8. AMC directors are appointed with the permission of trustees. 9. Most investor service centers are offices of. a. Trustees b. Registrar c. Custodian d. Fund Accountant 10. Fund accounting activity of a scheme is to be compulsorily outsourced. 11. SEBI regulates. a. Mutual Funds b. Depositories c. Registrar & Transfer Agents d. All of the above 12. Investment objective defines the broad investment charter. 13. Statement of Account is to be sent to investors within days of NFO closure. a. 3 b. 5 c. 7 d Within days of dividend declaration, warrants will have to be sent to investors. a. 7 b. 10 c. 15 d Unit holders can hold their units in demat form. c. d. 2

3 16. NFOs other than ELSS can be open for a maximum of. a. 7 days b. 10 days c. 15 days d. 30 days 17. Legally, SAI is part of the SID 18. Offer documents of mutual fund schemes are approved by SEBI. 19. Application form is attached to. a. SID b. SAI c. KIM d. None of the above 20. KIM has to be updated every 6 months. 21. Institutional distributors build reach through. a. Employees b. Agents c. Sub-brokers d. Any of the above 22. The maximum initial commission that a scheme can pay to distributors is. a. NIL b. 0.05% c. 1% d. 2% 23. The distributor can charge a fee from the investor. 3

4 24. Stock exchange brokers are permitted to distribute mutual funds without the requirement of passing the certifying test. 25. Trail commissions are linked to valuation of portfolio in the market. 26. Net assets of a scheme are nothing but its investment portfolio 27. The difference between NAV and re-purchase is. a. Entry load b. Exit load c. Expense d. Dividend Stripping 28. NAV of income funds is to be calculated up to decimals. a. 4 b. 3 c. 2 d Securities Transactions Tax is applicable to Equity Schemes. 30. Wealth Tax is payable at the application rates on equity mutual fund units. 31. As per SEBI regulations, foreign nationals are permitted to invest in Indian mutual funds, subject to KYC. 4

5 32. PAN Card is not required for mutual fund investments below Rs. 50,000 per mutual fund per financial year, where payment is in cash. 32. Investments in mutual funds can be made using a. Cheque / DD b. Remittance c. ASBA d. Any of the above 33. Cut-off timing guidelines are not applicable for a. NFO b. International funds c. Both of the above d. None of the above 34. STP is a combination of SIP and SWP 35. Investors KYC details are stored in the server of a. AMC b. AMFI c. SEBI d. KRA 36. Fundamental analysis is evaluation of the strength of the company s price-volume charts. 37. In a top-down approach, sector allocation precedes stock selection. 38. Which of the following is a truly international asset class? a. Real Estate b. Equity c. Debt d. Gold 5

6 39. Which of the following is a truly international asset class? a. Real Estate b. Equity c. Debt d. Gold 40. Loads and taxes may account for the difference between scheme returns and investor returns. 41. The most appropriate measure of returns for a scheme in existence for several years is. a. Simple Return b. Dividend Return c. Annualised Return d. CAGR 42. Risk can be measured by. a. Variance b. Standard Deviation c. Beta d. Any of the above 43. Equity markets are more predictable in the long term than the short term. 44. Arbitrage funds are meant to give better equity risk exposure. 45. The comparable for a liquid scheme is a. Equity scheme b. Balanced scheme c. Gilt scheme d. Savings bank account 6

7 46. Which of the following aspects of portfolio would an investor in a debt scheme give most importance? a. Sector selection b. Stock selection c. Weighted Average Maturity d. Number of securities in portfolio 47. Mutual fund ranking and rating amount to the same. 48. Gold Futures are superior to ETF Gold as a vehicle for life-long investment in gold. 49. As regards wealth tax, ETF Gold is superior to physical gold. 50. The National Pension System is regulated by a. SEBI b. IRDA c. PFRDA d. AMFI 51. An investor under the National Pension System can choose which of the following asset classes? a. Equity b. Corporate debt c. Government securities d. All of the above 52. Risk appetite of investors is assessed through a. Risk Appetizers b. Asset Allocators c. Risk Profilers d. Financial Plan 53. The objective of asset allocation is risk management 7