FinanceInsights has created mock tests for the NISM Mutual Fund Distributors V-A exam. Questions are based on NISM Mutual Fund Distributors V-A Workbook Version – Dec 21.
FinanceInsights has created a bank of about 700 questions.
The mock test is based on the actual examination. Every time you take the mock test, 100 random questions from the question bank will be presented. Each question will carry 1 mark each and should be completed in 2 hours. The passing score for the examination is 50 percent. There shall be no negative marking.
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In case of an index fund scheme or exchange traded fund, the total expense ratio of the scheme including the investment and advisory fees shall not exceed ____ per cent of the daily net assets.
Scheme returns published in MF advertisements are often factoring in exit load, if any.
In order to ascertain an investor's risk appetite, one must assess–
When a security's credit rating is downgraded, yield expectations ____.
The total expense ratio of close-ended equity-oriented scheme(s) shall not exceed ____ per cent of the daily net assets of the scheme.
In a 1:3 bonus issue, the investor is allotted _____________.
A scheme may invest in other schemes of the same Mutual Fund or other Mutual Funds. This will be limited to not more than __ percent of the net asset value of the scheme. (not applicable to Fund of Funds)
As per SEBI regulations, the minimum investment in equity and equity related instruments by flexicap funds shall be —
In the event of any issue with the AMC or mutual fund scheme, the investor can directly approach SEBI.
A scheme is considered to be suitable for an investor if its investment objective matches with the investor's needs.
Generally, when interest rates rise, prices of existing fixed-income securities ___ and vice versa.
The yields on debt securities tend to move up as the maturity _____.
Let's say the sale and purchase transactions of a scheme for a year amounted to Rs. 10,000 crores, and the average size of net assets is Rs. 5,000 crores; calculate the scheme's portfolio turnover ratio. Also, calculate the average holding period of investments in the scheme's portfolio.
Which debt fund can invest in government securities across different maturities? This fund needs to have minimum investments in G-Secs of 80 percent of total assets.
The unit capital of a scheme is calculated as —
When a fund imposes a restriction on redemptions, there will be no restriction on redemptions up to Rs ___ lakh(s).
What does 'credit risk' mean in case of bonds and debentures?
Short term capital gains in case of non-equity-oriented funds are taxed at —
Assuming inflation at 8% p.a., how much would goods/services worth Rs 10,000 today cost after 30 years?
If there is a change in the status of the investor under FATCA after the information is first provided, then the same has to be reported to the mutual fund within __ days.
The half yearly portfolio of schemes is available on the AMFI’s website and the website of AMC on or before the ___ day of the succeeding month.
In case of open-ended equity-oriented schemes other than as specified for fund-of-fund and index fund schemes, the total expense ratio of the scheme on the first Rs. 500 crores of the daily net assets is ____ percent.
A retirement solution-oriented scheme has a lock-in of —
Fund managers faced redemption pressure in ____-ended funds.
As per SEBI regulations, liquid funds can invest in debt and money market securities having maturity of —
It is mandatory to have an ARN to become a mutual fund distributor.
Each scheme’s NAV is required to be disclosed at the ___ of each business day.
Minimum investment required in AA+ and above corporate bonds for corporate bond funds is —
A Fund of Funds must have minimum investment in the underlying fund of —
Let's assume all days except Tuesday, Saturday and Sunday are business days. Rakesh submits an application on Monday to buy units of an equity mutual fund scheme for Rs. 3,00,000. The funds are realized on Wednesday by 5 pm. What NAV will be applied?
In case of close-ended funds, investors can purchase and sell units after the NFO —
Which is the standard risk statement that mutual funds have to carry with their advertisements?
Smart beta funds are similar to —
Schemes in the process of winding up are required to be listed on the stock exchange.
Tier 1 and Tier 2 bonds issued by banks and are perpetual in nature, are popularly called _______.
Which funds are expected to perform better?
In case of death of a mutual fund distributor, his nominee/legal heir need not be an ARN holder to claim and receive the commission.
Rajesh invested Rs. 1,00,000 in an equity- oriented mutual fund scheme in 2017 and the value of the investments as on January 31, 2018 was Rs. 2,00,000. He sold the investments completely and realised a value of Rs. 2,20,000 on February 9, 2018. How much would be his taxable capital gains?
What is MF Utilities?
What does 'Availability Heuristic' mean?
In case of interval funds, the maximum duration of the interval period is —
If the investor claims an unclaimed amount within 3 years, then payment is based on the —
KYC is required to comply with —
Index funds are traded on exchanges.
The AMC and schemes can have the same auditor.
Non-Convertible Preference Shares are to be treated as —
The record of investors and their unit-holding is maintained by —
In case of arbitrage funds, the minimum investment in equity and equity related instruments shall be —
Let's say risk free return is 5 percent, and a scheme with Beta of 1.2 earned a return of 8 percent. Calculate its Treynor Ratio.
Mutual funds are governed by the Indian Trusts Act, 1882.
Mutual funds are constituted as ‘Trusts’ in India. Who are the beneficiaries of the trust? (from NISM)
Scheme-wise Annual Report or an abridged summary should be sent to all unitholders ___ months from the date of closure of the relevant accounting year.
Which mutual fund trading platform has the mutual fund industry set up under AMFI?
The process of valuing each security in the investment portfolio of the scheme at its current market value is called ___________.
If the new inflows into a scheme from beyond top 30 cities are at least (a) 30 percent of gross new inflows in the scheme or (b) 15 percent of the average assets under management (year to date) of the scheme, whichever is higher, funds can charge the additional expense of up to ____ percent of the daily net assets of the scheme.
Upfront trail commission for a first time investor is paid to the distributor for SIP investments —
___ percent of unitholders can terminate the appointment of an AMC.
Corporate bond funds invest in corporate bonds rated —
Higher the modified duration, _____ is the interest sensitive risk in a debt portfolio.
No redemption or subscription is allowed in a segregated portfolio.
A mutual fund's trust deed is executed between —
Registrar and Transfer agents don't need to register with SEBI.
Unsystematic risk can be reduced through diversification. State whether True or False. (from NISM)
In case of fund of funds scheme, investing in other than a minimum of sixty-five per cent of assets under management in equity-oriented schemes and liquid schemes, index fund scheme and exchange traded funds, the total expense ratio of the scheme including weighted average of the total expense ratio levied by the underlying scheme(s) shall not exceed ____ per cent of the daily net assets of the scheme.
The principle of caveat emptor (let the buyer beware) applies to mutual fund investments.
The difference between a scheme’s actual return and its optimal return is its _______.
Exit load charged is uniform for all investors.
Certificates of Deposits issued by Banks are for ______.
__ percent of the unitholders (unitholding) can pass a resolution to wind up a scheme.
Which is the most appropriate measure of evaluating how closely an index fund is tracking its benchmark? (from NISM)
SEBI does not handle complaints issued against insurance companies.
Traded securities other than money market and debt securities forming part of a scheme's portfolio shall be valued at the _______.
Commodity derivatives are–
A scheme shall not invest more than __ percent of its NAV in debt instruments (money market and non-money market instruments) issued by a single issuer which are rated not below investment grade. (subject to certain stipulated exceptions)
To reflect the payout of dividend, the NAV will be adjusted ____ record date.
In case of joint holding, the income, be it capital gains or dividend, would be considered to have been earned by the ____.
Demand draft issued against cash for Rs.50,000 or more will not be accepted as payment for investment in a mutual fund.
Investors have bought 20 crore units of a mutual fund scheme at Rs. 10 each. The scheme has thus mobilized 20 crore units X Rs. 10 per unit i.e., Rs 200 crore. An amount of Rs. 140 crore is invested in equities. The balance amount of Rs 60 crore, mobilized from investors, was placed in bank deposits. Interest and dividend receivable (accrued but yet not received) by the scheme is Rs 8 crore, scheme expenses payable (accrued but not paid yet) is Rs 4 crore. Calculate the scheme’s NAV per unit. (from NISM)
If interest rates are expected to fall, a fund manager will invest in ____________.
“Segregated portfolio” means a portfolio, comprising of _____ affected by a credit event, that has been segregated in a mutual fund scheme.
Expenditure in excess of the prescribed total expense ratio limit has to be borne by the ___.
The maximum period for imposing gating or restriction on redemption in mutual funds is ____.
The record date for dividend shall be ____ calendar day(s) from the issue of the notice by the AMC. (this is not applicable for liquid schemes and debt schemes with dividend distribution frequency ranging from daily to monthly.)
When a scheme charges exit load, the repurchase price is ______ than the NAV.
Treynor Ratio comparisons should ideally be restricted to _____ schemes.
What term is used to describe the Net Asset Value (NAV) of the scheme after the dividend is paid out (Remember the NAV would have dropped to the extent of the dividend paid)? (from NISM)
The formula to calculate dividend yield is ___________.
The Income tax Act has ___ categories of mutual fund schemes.
What is the one thing that a POA holder cannot do in an investor's mutual fund account.
____ ratio indicates how much equity investors are prepared to pay in relation to the company’s earnings.
As per SEBI regulations, minimum investment in infrastructure-based securities by infrastructure funds should be —
Open-ended schemes have to re-open for sale/re- purchase within _ business days of the allotment in NFO.
In a multi asset allocation fund, foreign securities are treated as a separate asset class.
Allotment of units or refund of money, as the case may be, should be done within _ business days of closure of the NFO (within _ working day(s) in demat accounts).
Rajesh invested Rs. 1,00,000 in an equity- oriented mutual fund scheme in 2017 and the value of the investments as on January 31, 2018 was Rs. 2,00,000. He sold the investments completely and realised a value of Rs. 1,80,000 on February 9, 2018. How much capital gains tax would he pay?
As per the SEBI guidelines, how often should the mutual fund scheme’s portfolio be published? (from NISM)
The relationship between interest rates and bond prices is —
Gold held by a gold exchange traded fund shall be valued at the AM fixing price of London Bullion Market Association (LBMA) in US dollars per troy ounce for gold having a fineness of _____ parts per thousand.
NRI investors investing through an NRE account, should register __________ with the mutual fund.