Mutual Fund Management Multiple Choice Questions
1. The First player of the Mutual fund industry was______________.
A. ICICI MF
B. UTI MF
C. SBI MF
D. LIC MF
Answer: B. UTI MF
2. UTI mutual fund was set up in the Year _______________.
A. 1963
B. 1986
C. 1956
D. 1947
Answer: A. 1963
3. _______________ Mutual fund company was set up as a joint venture between RBI and Government of India
A. UTI MF
B. LIC MF
C. SBI MF
D. ICICI MF
Answer: A. UTI MF
4. Who establishes the Mutual Fund in India?
A. Securities Exchange Board of India
B. Asset Management Company
C. Sponsor
D. Shareholders
Answer: C. Sponsor
5. In India, AMC must be registered with____________.
A. Company’s Act, 2013
B. No registration required.
C. Securities Exchange Board of India
D. Reserve Bank of India
Answer: C. Securities Exchange Board of India
6. ___________ is a type of investment vehicle consisting of a portfolio of stocks, bonds, or other securities.
A. Government Securitie
B. Mutual Funds
C. Derivatives
D. Shares
Answer: B. Mutual Funds
7. The value of one unit of investment in Mutual fund is called the _______________.
A. Net Asset Value
B. Issue value
C. Market value
D. Gross Asset value
Answer: A. Net Asset Value
8. ________________ regulates the Mutual fund industry in India.
A. Reserve Bank of India
B. Association of Mutual Funds of India
C. Securities Exchange Board of India
D. State Bank of India
Answer: C. Securities Exchange Board of India
9. What is the full form of NAV?
A. Net Assessment Value
B. National Asset Value
C. Net Asset Value
D. National Asset variation
Answer: C. Net Asset Value
10. _______________ schemes not exposed to sudden and large movements of funds.
A. Fixed maturity plan
B. Open-Ended Funds
C. Close-Ended Funds
D. Interval fund
Answer: C. Close-Ended Funds
11. The feature of a mutual fund, where it spreads the investment in varied stocks and sectors by pooling the funds of various investors, is called as ______________.
A. Professional Management
B. Affordability
C. Diversification
D. Profit
Answer: C. Diversification
12. Dividend income received from mutual in the hands of unit holders
A. Fully Taxable
B. Fully Exempt
C. Partly Exempt
D. Partly Taxable
Answer: B. Fully Exempt
13. Which of the following is not a limitation of mutual funds?
A. No guarantee of return
B. Fees and Expenses
C. Poor Performance
D. Professional Management
Answer: D. Professional Management
14. The Mutual fund industry follows which of the following regulation?
A. SEBI (Mutual fund) regulations 1996
B. Mutual fund regulation 2004
C. Mutual fund regulation 2003
D. RBI
Answer: A. SEBI (Mutual fund) regulations 1996
15. Presently there are __________ AMC in India
A. 40
B. 50
C. 44
D. 39
Answer: C. 44
16. A _________________ is a trust that pools the savings of a number of investors who share common financial goals.
A. Share
B. Mutual Funds
C. Government Securities
D. Derivatives
Answer: B. Mutual Funds
17. What are the reasons for economies of scale to the benefit of Mutual funds?
A. Large volumes of trade
B. Portfolio diversification
C. Risk reduction
D. Loss
Answer: B. Portfolio diversification
18. _____________ are also known as the protectors of the fund and are employed by the fund sponsor.
A. Sponsor
B. Trustees
C. Asset Management Company
D. Custodian
Answer: B. Trustees
19. A minimum start-up capital of about ______________is required for open-ended schemes
A. 500 million
B. 1000 million
C. 350 million
D. 200 million
Answer: D. 200 million
20. A minimum start-up capital of about ______________is required for close-ended schemes
A. 150 million
B. 100 million
C. 350 million
D. 200 million
Answer: A. 150 million
21. The funds in which units can be purchased only during the initial offer period are called
A. Open-Ended Fund
B. Close-Ended Funds
C. Interval Funds
D. Fixed maturity plan
Answer: B. Close-Ended Funds
22. ______________ are considered high-risk funds but also tend to provide high returns.
A. Equity Fund
B. Money Market Funds
C. Balanced or Hybrid Funds
D. Debt Funds
Answer: A. Equity Fund
23. ____________ are funds that invest in company debentures, government bonds and other fixed-income assets.
A. Equity Fund
B. Money Market Funds
C. Balanced or Hybrid Funds
D. Debt Funds
Answer: D. Debt Funds
24. HDFC Sensex ETF is an example of ____________.
A. Sector Fund
B. Index Funds
C. Fund of funds
D. International funds
Answer: B. Index Funds
25. Nippon India Pharma fund is an example of ______________.
A. Sector Fund
B. Index Funds
C. Equity funds
D. Global funds
Answer: C. Equity funds
26. AMFI was incorporated on ________________.
A. 22nd August 1995
B. 12th April 1992
C. 1st April 1935
D. 15th August 1947
Answer: A. 22nd August 1995
27. Which type of fund is more volatile?
A. Large-cap fund
B. Mid-cap funds
C. Small-cap funds
D. Hybrid Funds
Answer: A. Large-cap fund
28. An investor pays a tax on the dividend that he receives from a mutual fund scheme at
A. 10%
B. 20%
C. 30%
D. Tax is not applicable
Answer: A. 10%
29. Investors can enter and exit under _______ at any time
A. Fixed maturity plan
B. Open-Ended Funds
C. Close-Ended Funds
D. Interval fund
Answer: B. Open-Ended Funds
30. The NAV of each scheme should be updated on AMFI’s website
A. Every Day
B. Every month
C. Every hour
D. Every quarter
Answer: A. Every Day
31. Mutual Fund schemes are first offered to investors through.
A. Stock exchange
B. New Fund Offer
C. Initial Public Offer
D. AMFI
Answer: B. New Fund Offer
32. Which of the following banks launched the first mutual fund in India?
A. SBI
B. Canara Bank
C. Bank of India
D. Indian Bank
Answer: A. SBI
33. Which of the following organizations is the Mutual Fund Market regulator in India?
A. SEBI
B. RBI
C. AMFI
D. CIBIL
Answer: C. AMFI
34. A Mutual fund is owned by _____________.
A. SEBI
B. The Government of India
C. AMFI
D. All its investors
Answer: D. All its investors
35. SIP is a _______________.
A. Method of regular investment
B. Name of a mutual fund
C. Brand of a tea stock
D. Method of one time investment
Answer: A. Method of regular investment
36. SIP stands for ______________.
A. Systematic investment plan
B. Simple investment plan
C. Simplified investment programme
D. Single investment plan
Answer: A. Systematic investment plan
37. Day to day operations of a mutual fund is handled by
A. Asset Management Company
B. Sponsor
C. Trustee
D. Shareholders
Answer: B. Sponsor
38. Mutual funds are constituted in India as ____________.
A. Trust
B. Limited liability partnership
C. Companies
D. Non-Government organisations
Answer: A. Trust
39. The susceptibility of a mutual fund’s performance to general stock market conditions is known as
A. Interest rate risk
B. Market risk
C. Exchange risk
D. Corporate risk
Answer: B. Market risk
40. The _________ is the market value of the securities that mutual funds have purchased minus any liabilities per unit.
A. Net asset value
B. Book value
C. Gross asset value
D. Net worth value
Answer: A. Net asset value
41. Which payment mode is not applicable while purchasing mutual fund scheme?
A. Cheque
B. Demand Draft
C. Cash
D. Pay Order
Answer: C. Cash
42. ____________ are an important link between fund managers and investors.
A. Trustee
B. Asset Management Company
C. Custodian
D. Registrar And Transfer Agents
Answer: D. Registrar And Transfer Agents
43. What is an open-ended mutual fund?
A. It is the one that has an option to invest in any kind of security
B. It has units available for sale and repurchase at all times.
C. It has an upper limit on its NAV
D. It has a fixed fund size
Answer: B. It has units available for sale and repurchase at all times.
44. In ____________ funds, the money is invested primarily in short-term or very short-term instruments e.g. T-Bills, CPs etc.
A. Growth fund
B. Income funds
C. Liquid funds
D. Tax-Saving Funds (ELSS)
Answer: C. Liquid funds
45. ________ is a method of investing in mutual funds wherein an investor chooses a mutual fund scheme and invests a the fixed amount of his choice at fixed intervals.
A. Systematic Transfer Plan
B. Systematic Withdrawal Plan
C. Systematic Investment Plan
D. Systematic Innovative Plan
Answer: C. Systematic Investment Plan
46. Mutual funds in India are permitted to invest in___________
A. Securitie
B. Securities and gold
C. Securities other than real estate
D. Securities, gold, real estate
Answer: D. Securities, gold, real estate
47. ……… is the first time subscription offer for a new scheme launched by the Asset Management Company.
A. FFO
B. CFO
C. IPO
D. NFO
Answer: D. NFO
48. A mutual fund is a ……………intermediary (like a trust) regulated in India by the SEBI.
A. financial
B. professional
C. physical
D. Mental
Answer: A. financial
49. Transaction cost is ………… with investment in Mutual Funds.
A. high
B. low
C. very high
D. Nil
Answer: B. low
50. ………………… helps to improve the risk return relationship.
A. Diversification
B. Liquidity
C. Professional Management
D. tax
Answer: A. Diversification
51. Open ended funds can be purchased and sold ………………….
A. Anytime during the day
B. Only at the beginning of the day
C. Only at the end of the day
D. Starting of the day
Answer: C. Only at the end of the day
52. ……………………. is a facility where investor will invest a fixed amount in a mutual fund scheme at regular intervals.
A. SIP
B. SWP
C. STP
D. SRT
Answer: A. SIP
53. …………….. allows an investor to withdraw a fixed amount of money periodically.
A. SIP
B. SWP
C. STP
D. SRT
Answer: B. SWP
54. In …………….. STP investor transfers the profit from one fund and invests in the other.
A. Flexi
B. Capital Appreciation
C. Fixed
D. Net
Answer: B. Capital Appreciation
55. ……………. is a facility provided by banks to investors in new fund offers (NFOs) of mutual funds.
A. ASBA
B. CASBA
C. MASBA
D. NASA
Answer: A. ASBA
56. A ……………… ended scheme shall be wound upon the expiry of duration fixed in the scheme on the redemption of units.
A. Open
B. close
C. Old
D. New
Answer: B. close
57. A mutual fund has a beginning balance of 100 million earns interest of 10 million, receives dividends of 15 million, and has expenses of 5 million. If 10 million shares are outstanding, what is the NAV?
A. 10.50
B. 11.00
C. 12.00
D. 12.50
Answer: C. 12.00
58. You invested 1,000 in a mutual fund with a 4% load when NAV was 20 per share. If you sell your shares at a NAV of 20 per share, what is the return of your investment?
A. 14.8%
B. 15.2%
C. 12.5%
D. 10.8%
Answer: B. 15.2%
59. If a mutual fund NAV Is 50 and its expense ratio is 2% what are the total expenses per share?
A. 2
B. 10
C. 1
D. 5
Answer: C. 1
60. How much money would you need to purchase 400 shares of a mutual fund with a NAV of $55 per share and a 3% load?
A. $22,000
B. $21,450
C. $23,200
D. $22,660
Answer: D. $22,660
61. Investors in high tax brackets will normally achieve higher performance by selecting a mutual
fund that generates
A. long-term dividends
B. long-term capital gains
C. long-term stock dividends
D. short-term capital gains
Answer: B. long-term capital gains
62. What would be the tax consequence of owning a mutual fund that made distributions of 600 resulting from short-term capital gains and $800 resulting from long-term capital gain rate?
A. 420
B. 140
C. 300
D. 260
Answer: D. 260
63. If a scheme has 45Cr units issued and has an FV of Rs. 10 and NAV is at 11.33, unit capital(Rs.Cr) would be equal to
A. 500.85
B. 50.85
C. 950.85
D. 450
Answer: B. 50.85
64. A scheme has average weekly net assets of Rs. 324 Cr and has annual expenses of Rs 3.24Cr, it’s expenses ratio is
A. 1%
B. 10%
C. Can’t say
D. Insufficient information
Answer: A. 1%
65. For a scheme to be defined as an equal fund, it must have a minimum
A. 65% in Indian equities
B. 65% in equities
C. 51% Indian equities
D. 35% in Indian equities
Answer: B. 65% in equities
66. Which of the following characteristics is not true of close-ended funds?
A. They can be load or no-load funds.
B. They do not repurchase shares from investors.
C. They are bought and sold on stock exchanges.
D. They may sell above or below NAV.
Answer: A. They can be load or no-load funds.
67. Regarding load and no-load mutual funds,
A. Load funds usually outperform no-load funds
B. no-load funds perform at least as well as load funds even fees are ignored.
C. Two types of fund perform about the same considering the fees
D. Load funds may be bought directly, whereas no-load funds must be purchased through a broker.
Answer: B. no-load funds perform at least as well as load funds even fees are ignored.
68. On average, actively managed mutual funds have an expenses ratio of about
A. 1.5%
B. 2.5%
C. 3%
D. 5%.
Answer: A. 1.5%
69. The component of the expense ratio that includes a fee charged by some mutual funds to pay brokers is
A. A management fee
B. A 12b-1 fee
C. An administrative expense.
D. A referral fee.
Answer: B. A 12b-1 fee
70. which of the following is a stock mutual fund?
A. Ginnie Mae fund
B. Growth fund
C. Municipal securities fund
D. Treasury securities find
Answer: B. Growth fund
71. Which of the following stock mutual fund focus on medium-sized companies that are more established than small-cap firms, but may have less growth potential?
A. Equity income funds
B. Sector funds
C. Mid-size capitalisation funds
D. Balance growth and income funds
Answer: C. Mid-size capitalisation funds
72. Which of the following is not a reason why Index funds typically incur lower expenses than other mutual funds?
A. Index funds are not actively managed
B. There are no expenses for research
C. The portfolio is reversed infrequently, so the transaction cost is low.
D. The security and Exchange Commission set a limit on index fund expenses
Answer: D. The security and Exchange Commission set a limit on index fund expenses
73. ______ funds are mutual funds that attempt to mirror the movements of the existing board market indicators.
A. Internet
B. Stock
C. Index
D. International
Answer: C. Index
74. Index funds incur _______ expenses and are ______ managed compared to other funds.
A. fewer; not actively
B. fewer; actively
C. more; not actively
D. more; actively
Answer: A. fewer; not actively
75. Index funds offer tax advantages because they ______ In much trading and, therefore, _______ capital gains.
A. engage; generate
B. do not engage; generate
C. engage; do not generate
D. do not engage; do not generate
Answer: D. do not engage; do not generate
76. The difference between an international and a global fund is
A. global funds invest in both U.S. firms and those of other countries wherever International funds focus on firms outside the United States.
B. International funds invest in U.S. firms and those of other countries while global funds invest only in foreign firms.
C. international funds in Treasury securities but no U.S. firms while global funds invest in both.
D. there is no difference except in name.
Answer: A. global funds invest in both U.S. firms and those of other countries wherever International funds focus on firms outside the United States.
77. Which of the following is not true of global and international bond funds?
A. They may be subject to interest rate risk.
B. They may be subject to exchange rate risk.
C. Their expenses may be higher than those of domestic bond funds.
D. They are especially attractive to investors in a high tax bracket.
Answer: D. They are especially attractive to investors in a high tax bracket.
78. High yield (junk-bond funds focus on relatively risky bonds issued by firms that are subject to
A. default risk
B. interest rate risk
C. exchange risk
D. management risk
Answer: A. default risk
79. International bond funds
A. focus on bonds interest by non-U.S. firms or governments.
B. may hold bonds that offer a higher yield then the U.S. bound.
C. are subject to exchange rate risk.
D. All of the above correct.
Answer: D. All of the above correct.
80. _______ mutual funds invest in both foreign bonds and U.S. bonds.
A. International bonds
B. Index
C. Treasury bond
D. Global bond
Answer: D. Global bond
81. Index funds are popular to all of the following reasons except
A. their performance relative to other mutual funds.
B. they incur low expenses.
C. they are not actively manag
Answer: D.
82. Technology funds focus on technology-based firms. Which of the following statements regarding those firms is not true?
A. Many of those firms are relatively young.
B. They have a low degree of risk.
C. They have the potential for a high return.
D. They do not have a consistent record of strong performance.
Answer: B. They have a low degree of risk.
83. Existing shares of closed-ended mutual fund companies are purchased
A. from the investments company directly.
B. from the investment company through a broker.
C. from other investors in the stock market.
D. from a bank.
Answer: C. from other investors in the stock market.
84. In calculation the net assets value (NAV) which of the following is true?
A. Dividends are subtracted and expenses added
B. Interest is subtracted and expenses are added.
C. dividends are added and expenses are subtracted
D. Interest and other expenses are not included
Answer: C. dividends are added and expenses are subtracted
85. To calculate the NAV, the market value of the portfolio liabilities is the dividend by the ______ to arrive at a per-share basis.
A. original number of shares
B. share currently issued by the fund
C. maximum shear to be issued
D. average number of shares incomparable funds.
Answer: B. share currently issued by the fund
86. An open-ended mutual fund may do all of the following except
A. sell shares directly to investors.
B. charge a fee to buy but not sell shares.
C. repurchase shares from investors who want to sell their shares.
D. have its shares traded on a New York Stock Exchange.
Answer: D. have its shares traded on a New York Stock Exchange.
87. The amount by which a close-ended fund’s share price in the secondary market is above the fund’s NAV is called the
A. market value
B. premium
C. discount
D. par value
Answer: B. premium
88. ______ is a tax that is imposed by the government on companies based on dividend paid to a company’s investors.
A. dividend distribution tax
B. return on investment tax
C. goods and services tax
D. corporate tax
Answer: A. dividend distribution tax
89. All dividends in Equity & Equity Oriented Funds will be taxed at _____ from 2018.
A. 5%
B. 10%
C. exempt up to 10%
D. not taxable at all
Answer: B. 10%
90. Sponsor must hold at least _______% of the AMCs networth.
A. 30 %
B. 40 %
C. 50 %
D. 60 %
Answer: B. 40 %
91. AMCs net worth has to be at least __________
A. 5 Crore
B. 7 Crore
C. 10 Crore
D. 12 Crore
Answer: C. 10 Crore
92. At least _____ % of the AMC directors Should be independent .
A. 30
B. 40
C. 50
D. 60
Answer: C. 50
93. The AMC and the Trustees enter into an _____ Agreement.
A. Investment Management
B. Memorandum of Association
C. Legal
D. None of the above
Answer: A. Investment Management
94. If ______ of unit holders approve , The service of the AMC can be terminated.
A. 50%
B. 75%
C. 60%
D. 40%
Answer: B. 75%
95. Scheme take over do not result in merger of ______.
A. Trusts
B. AMC
C. AMFI
D. All of the above
Answer: B. AMC
96. Any grievance against the AMC can be addressed to _______
A. AMFI
B. DCA
C. Trustees
D. AMF
Answer: B. DCA
97. The UTI is governed by _________.
A. UTI Act
B. Company Act
C. Partnership Act
D. HUF Act
Answer: A. UTI Act
98. Listed mutual funds have to abide by __________ of the stock exchanges.
A. Listing Regulations
B. Legal
C. Internal
D. None of the above
Answer: A. Listing Regulations
99. The offer document of an open ended fund is valid for ______ years.
A. 1
B. 2
C. 3
D. 2.5
Answer: B. 2
100. If equity markets move up, P/E tatio will move ________.
A. Up
B. Down
C. No change
D. None of the above
Answer: A. Up
101. If equity markets move down, dividend yield will move ________.
A. Up
B. Down
C. Sable
D. None of the above
Answer: A. Up
102. Investments are accounted for on _______ date.
A. Year end
B. Quarter end
C. Trade
D. Half year end
Answer: C. Trade
103. Initial issue expenses cannot exceed _______% of amount mobilised.
A. 5
B. 6
C. 4
D. 3
Answer: B. 6
104. Initial issue expenses of open-ended funds is amortised over a period not exceeding years_______%
A. 1
B. 2
C. 3
D. 4
Answer: A. 1
105. Mutual funds cannot pay dividend out of _______.
A. Net profit
B. Net loss
C. Unrealised profit
D. Realised profit
Answer: C. Unrealised profit
106. An asset is non-performing if interest and/or principal are due for over ________ months.
A. One
B. Two
C. Three
D. Four
Answer: C. Three
107. An equity shares is considered non-traded if it is not traded for over _______ days.
A. 15
B. 20
C. 25
D. 30
Answer: D. 30
108. Valuation of debt instrument with less than 182 days to maturity is done on _______ basis.
A. Accrual
B. Cash
C. Real
D. None of the above
Answer: A. Accrual
109. Illiquid securities should not exceed _________% of the net assets.
A. 5
B. 7
C. 10
D. 15
Answer: D. 15
110. For an index fund, Ex-Marks will be ________%.
A. 50
B. 70
C. 90
D. 100
Answer: D. 100
111. If fund is assuming higher risk than the market index, its beta will be ________.
A. Greater than 1
B. Less than 1
C. Equal to 1
D. Equal to 2
Answer: A. Greater than 1
112. Graham’s strategy recommends ________% holding in debt funds and 50% holding in equity funds.
A. 50
B. 75
C. 40
D. 60
Answer: A. 50
113. Expenses ratio is very important for _____.
A. Debt fund
B. Index fund
C. Equity fund
D. Currency fund
Answer: A. Debt fund
114. According to Bogle an investor’s exposure to debt investment should be equal to his ___.
A. Sex
B. Age
C. Income
D. Cast
Answer: B. Age
115. Higher expenses ratios lead to _______.
A. Yield sacrifices
B. Profit
C. Income
D. Wealth
Answer: A. Yield sacrifices
116. Closed ended funds were usually trading at _________ to NAV
A. Par
B. Premium
C. Discount
D. Free
Answer: C. Discount
117. If a single unit holder holds more than _________ of net assets , the number of Such unit holders and their percentage holding in the net assets have to be disclosed.
A. 10 %
B. 15 %
C. 20 %
D. 25%
Answer: D. 25%
118. If opening units 10,000 Units subscribe 3000, Units redeem 1000 then Closing units?
A. 10,000 units
B. 13,000 units
C. 12,000 units
D. 14,000 units
Answer: C. 12,000 units
119. If opening units 25,000 ,Units subscribe 7000, Units redeem 2000 then Closing units?
A. 30,000 units
B. 25,000 units
C. 32,000 units
D. 44,000 units
Answer: A. 30,000 units
120. If opening units 1,25,000 Units subscribe 2,00,000, Units redeem 50,000 then Closing units?
A. 3,25,000 units
B. 2,75,000 units
C. 3,75,000 units
D. 2,50,000 units
Answer: B. 2,75,000 units
121. NAV stands for
A. Net Application Value
B. Notional Assets Value
C. Net Assets Value
D. Net Assets
Answer: C. Net Assets Value
122. High yield bonds have ______ potentials.
A. Low
B. High
C. Average
D. none
Answer: B. High
123. Treasury bonds funds with short maturities have ______ default risk.
A. High
B. Low
C. Average
D. Nil
Answer: B. Low
124. Portfolio turnover is ______ for liquid funds.
A. Low
B. High
C. Average
D. Nil
Answer: B. High
125. The benchmark for a balanced fund is Equity index and _______ combined in the same Proportion.
A. Market Index
B. Debt Index
C. Gold Index
D. Currency Index
Answer: B. Debt Index
126. The AMC received no fees on funds are called as _______
A. Full Load
B. Extra Load
C. No Load
D. Half Load
Answer: C. No Load
127. UTI Act was enacted in the year ______.
A. 1975
B. 1955
C. 1963
D. 1995
Answer: C. 1963
128. Expense ratio for a funds should be as ______ as possible.
A. High
B. Low
C. Average
D. NIl
Answer: B. Low
129. Jensen’s Alpha focuses on _____________
A. Systematic Risk
B. Unsystematic Risk
C. Political Risk
D. Legal Risk
Answer: B. Unsystematic Risk
130. A benchmark once chosen cannot be altered without _________ approval.
A. Custodian
B. AMFI
C. Trustees
D. RBI
Answer: C. Trustees
131. Tracking Error of _______ fund has to be minimized.
A. Index Fund
B. Debt Fund
C. Guilt Fund
D. Equity Fund
Answer: A. Index Fund
132. The ________ can issue offer documents on behalf of the trustees.
A. AMC
B. Custodian
C. Agents
D. AMD
Answer: A. AMC
133. Expenses incurred that are above the regulatory limit are borne by sponsor & _____
A. AMC
B. Custodian
C. Agents
D. AMD
Answer: A. AMC
134. A fund with _____ Sharpe ratio than the market is outperforming the market.
A. Lower
B. Higher
C. Average
D. Nil
Answer: B. Higher
135. ________ funds tends to have lower expense than other type of mutual funds.
A. Equity funds
B. Debt Funds
C. Balance Funds
D. Index funds
Answer: D. Index funds
136. Rupee cost averaging means investing fixed amount _________.
A. Periodically
B. Lump sum
C. Yearly
D. Half Yearly
Answer: A. Periodically
137. ETF stands for ____________.
A. Exchange Traded Funds
B. Even Traded Funds
C. Exchange Transactions Funds
D. Extra Traded Funds
Answer: A. Exchange Traded Funds
138. NFO stands for_____________
A. New Funds Offer
B. Net Frauds in Office
C. New Funds in Office
D. Net Frauds Offer
Answer: A. New Funds Offer
139. If Holding Period return are 25% & period is 2 years then Annualized returns ____.
A. 25%
B. 12.5%
C. 50%
D. 37.5%
Answer: B. 12.5%
140. If Holding Period return are 20% & period is 2 years then Annualized returns ____.
A. 20%
B. 10%
C. 40%
D. 15%
Answer: B. 10%
141. Financial year for all mutual fund schemes ends on ……………
A. 31st December
B. 31st March
C. 30th September
D. 30th June
Answer: B. 31st March
142. Risk is less in ………………….
A. Equity fund
B. growth fund
C. index fund
D. debt fund
Answer: D. debt fund
143. Equity funds are exempt from long term capital gain tax when investments are held for at least ………… months from the date of acquisition.
A. 6
B. 3
C. 9
D. 12
Answer: D. 12
144. ……………… funds invest in companies of different sectors across the market.
A. Sectoral
B. Diversified
C. Thematic
D. Index based
Answer: B. Diversified
145. ………… funds are an extension of sector funds.
A. Value
B. Diversified
C. Thematic
D. Index based
Answer: C. Thematic
146. ………… funds use algorithmic, in which computer software takes buy/ sell decisions on the basis of formula
A. Value
B. Quant
C. Thematic
D. Arbitrage
Answer: B. Quant
147. Open-ended funds have to update offer document at least once in………… years
A. 3
B. 2
C. 4
D. 5
Answer: B. 2
148. CAS stands for …………………..
A. Combined Account Statement
B. Consolidated Account Statement
C. Combined Account System
D. Consolidated Account System
Answer: B. Consolidated Account Statement
149. Consolidated Account Statements is sent …………….. to investors in whose folios no transaction has taken place.
A. every 2 months
B. every 3 months
C. every 4 months
D. every 6 months
Answer: D. every 6 months
150. R-squared value range from 0 to ……………
A. 0.5
B. 0.75
C. 1
D. 0.25
Answer: C. 1
151. A …………… risk refers to the possibility of a stock issuer to go bankrupt or facing heavy losses.
A. Business
B. Credit
C. Capital
D. Scheme
Answer: A. Business
152. A …………… risk in a mutual fund refers to a situation when the issuer of a stock is unable to make timely payment of interest and principal to the investors.
A. Business
B. Credit
C. Capital
D. Scheme
Answer: B. Credit
153. …………….. risk refers to the investor losing the money invested in mutual funds.
A. Business
B. Credit
C. Capital
D. Scheme
Answer: B. Credit
154. …………….. risk refers to a risk that affects the entire country or a particular region or a certain industry.
A. Market
B. Credit
C. Capital
D. Scheme
Answer: A. Market
155. ……………… risk refers to a risk when there is political changes or change in investment policy of the government.
A. Market
B. Credit
C. Political
D. Scheme
Answer: C. Political
156. ……………………. Ratio determines how the return of the scheme has compensated and investor for the risk he has taken.
A. Treynor
B. Sharpe
C. Sortino
D. Information
Answer: C. Sortino
157. The risk of losing money invested in mutual funds is called …………
A. Capital risk
B. scheme risk
C. credit risk
D. market risk
Answer: A. Capital risk
158. ……………….. ratio is a measure of the risk-adjusted return of a financial security or asset or portfolio.
A. Treynor
B. Sharpe
C. Sortino
D. Information
Answer: D. Information
159. Returns from non-equity funds are treated as long term capital gains if investments are held for more than ……………….
A. 4 years
B. 2 years
C. 3 years
D. 5 years
Answer: C. 3 years
160. NAV is declared everyday by deducting ……………. expenses
A. Recurring
B. Transaction
C. Exit load
D. Entry load
Answer: A. Recurring
161. ……………….. ratio is the percentage of total assets that are spent to run a mutual fund
A. Treynor
B. Sharpe
C. Expense
D. Information
Answer: C. Expense
162. …………. provides in detail scheme wise information about income and expenditure of mutual fund.
A. Balance Sheet
B. Revenue Statement
C. Cash Flow Statement
D. Fund Flow Statement
Answer: B. Revenue Statement
163. The returns earned from mutual funds are taxed under the head ……………..
A. Income from House Property
B. Salary Income
C. Income from Capital gains
D. Income from other sources
Answer: C. Income from Capital gains
164. When a security is not traded on any recognized stock exchange for a period of …. days prior to the valuation date, the scrip must be treated as a “non-traded “security.
A. 30 days
B. 40 days
C. 45 days
D. 60 days
Answer: D. 60 days
165. ………….. ratio is the percentage of total assets that are spent to run a mutual fund.
A. expense
B. income
C. Profit
D. Turnover
Answer: A. expense
166. Equity related schemes are ………….. risky when compared to debt debt schemes.
A. less
B. equally
C. more
D. Cannot say
Answer: C. more
167. The accounting year for mutual funds ends on ……… of each year.
A. 31st December
B. 31st March
C. 30th September
D. 1st April
Answer: B. 31st March
168. ……………….. of a mutual fund is the price at which units are bought or sold by investor.
A. CP
B. SP
C. NAV
D. NPV
Answer: C. NAV
169. In ………………………. Investors buy shares of Companies who have announced bonus issues, and subsequently sell the original holding at a loss once the stock becomes ex-bonus.
A. Dividend stripping
B. Bonus stripping
C. Capital stripping
D. Asset stripping
Answer: B. Bonus stripping
170. ……………. is a measure of the volatility of a particular fund in comparison to the market as a whole
A. Beta
B. R-squared
C. Standard deviation
D. Alpha
Answer: A. Beta
171. ……………….. measures the dispersion in return.
A. Beta
B. R-squared
C. Standard deviation
D. Alpha
Answer: C. Standard deviation
172. CAGR stands for …………………
A. Calculated Annual Growth Rate
B. Compounded Annual Growth Rate
C. Changed Annual Growth Rate
D. Changed Annual Grown Rate
Answer: B. Compounded Annual Growth Rate
173. ………………… are simply the annual gains that an investment has earned over a specific period of time.
A. Annualized Return
B. Absolute Return
C. Holding period return
D. None of the above
Answer: A. Annualized Return
174. The performance of a scheme is reflected in its ……………..
A. Net asset value
B. Face Value
C. NPV
D. AMC
Answer: A. Net asset value
175. …………………. is a myth about Mutual Fund Investment in India.
A. Small amount is needed to invest in Mutual Funds
B. Higher NAV is better
C. Demat account is compulsory to invest in Mutual funds
D. Big amount is needed to invest in Mutual Funds
Answer: C. Demat account is compulsory to invest in Mutual funds
176. Abridged version of OD is called …………..
A. OD
B. NFO
C. KIM
D. CD
Answer: C. KIM
177. ——————— is a supplementary document that contains additional information of the fund.
A. SID
B. SAI
C. KIM
D. OD
Answer: B. SAI
178. ……………. approve the contents of the Offer document
A. AMC
B. Trustee
C. Custodian
D. Sponsor
Answer: B. Trustee