VINAYAKA MISSIONS RESEARCH FOUNDATION

AARUPADAIVEEDU INSTITUTE OF TECHNOLOGY

DEPARTMENT OF MANAGEMENT
INTERNAL ASSESSMENT – MODEL EXAM
BRANCH: MBA YEAR/SEM: II/IV
SUBJECT: SECURITY ANALYSIS AND PORTFOLIO MANAGEMENT DATE: 22.06.2022
TIME: 3 HOURS TOTAL: 100 MARKS

Choose the right answer PART – A (10 X 1 = 10)

1. The risk of an investment refers to ______

a. The measurability of its rate of return b. The variability of rate of return
c. The volatility of its rate of return d. The failure of dividend or interest

2. Investment risk commonly measured with ______

a. Arithmetic Mean b. Standard Deviation
c. Correlation coefficient d. Regression

3. ______ is an institution which dematerializes physical certificates and effects transfer of

ownership by electronic book entries.
a. Stock Exchanges b. Depositories
c. Regulators d. Custodians

4. _______ is a pool of capital which is essentially invested in equity shares or equity-linked

instruments of unlisted companies.
a. Mutual Fund b. Venture Capital Fund
c. Capital Reserve Fund d. None of these

5. A growth industry is defined as an industry with ______

a. 15% rate of growth per annum b. Where demand for its product is growing
c. High capital investment d. Average growth > growth of the economy

6. A common stock pay-out ratio

a. Is directly related to the company’s growth rate b. Can be zero for a growth firm
c. Indicates the future cash dividends to be expected d. None of these

7. Dow theory explains

a. New York Stock market movement b. The Dow Jones Industrial averages
c. Security market price movement d. The buy and sell strategy

8. Stock price line rises above the moving average line which is falling .
a. Buy signal b. Sell Signal
c. Neither Buy nor Sell Signal d. None of these

9. Portfolio construction refers to allocation of funds among a variety of _____

a. Financial assets c. Financial liabilities
b. Own resources d. Other assets

10. Markowitz model of portfolio theory deals ____

a. Target risk b. Systematic risk
c. Market risk d. Financial risk
Answer ALL Questions PART - B (10 X 2 = 20)

11. Explain Glit Scheme in Mutual Fund.

12. Explain the NAV.
13. Explain Book building and relevant in market
14. Describe NSDL and its uses.
15. State the factors that affect the EPS of the company.
16. State the industrial classification according to growth.
17. What do you mean by currency option?
18. Explain the basic premises of technical analysis.
19. Explain the term portfolio management.
20. List the assumption of CAPM

Answer ALL Questions PART - C (5 X 14 = 70)

21. a. Explain the investment process in detail. What do you mean by investment and
speculation? Explain investment versus speculation.
Or
b. Define investment risk. Discuss how systematic and unsystematic risk effects
investment?

22. a. Discuss the objectives and functions of SEBI. Explain the organization of SEBI.
Or
b. Explain in detail the features of NSE.

23. a. Describe the basic assumptions of CAPM. Explain the advantages of adopting CAPM
model in the portfolio management.
Or
b. Explain how the efficient frontier is determined using Markowitz approach. What are the
characteristics of assets that lie on the efficient frontier? What are the strength and weakness of
the Markowitz approach?

24. a. How does technical analysis differ from fundamental analysis? Explain the ways in
which the technicians think before they act?
Or
b. Explain the utility of the economic analysis and state the economic factors considered
for this analysis.

25. a. Explain the modern approach in the construction of portfolio. Discuss the factors
relevant for selecting fixed income avenues.
Or
b. Briefly discuss the three basic policies with respect to portfolio rebalancing.