1). Which of the following is the function of the Secondary markets?

a) Provides liquidity for securities issued.

b) Provides a platform for making public issues.
c) Provides information about Public companies.
d) All of the above.

2) The following is the requirement of granting the certificates of registration

under Portfolio Manager Regulation 2020.
a) The applicant is a body corporate.
b) The applicant has necessary infrastructure like office space, equipment and
manpower.
c) The applicant has appointed a compliance officer.
d) All of the above.

3) Which of these are correct when fixed income instrument has positive
convexity?
1. Price rise is more than the duration estimate when interest rate declines.
2. Price rise is less than the duration estimates when interest rates declines.
3. Price falls is more than the duration estimates when interest rates rises.
4. Price fall is less than the duration estimates when interest rates rises.

a) 1&2
b) 1&3
c) 1&4
d) 3& 4

4) The first step in the investment process is the development of …………..

a) Objective Statement
b) Investment policy statement
c) Financial Statement
d) Statement of cash needs.

5) Government securities carry practically no risk of ………… and hence are

called risk free or gilt edge instruments.
a) Tradibility
b) Liquidity
c) Defualt.
d) Negotiability.
6) The following scheme have the features of ……….
1) Continous Sales and purchase of Units at NAV or NAV related prices.
11) Investor can enter and exit the Scheme any time during the life of a fund
111) The Scheme does not have specific time frame.

a) Open Ended
b) Close Ended
c) Interval Fund
d) All of the above.

7) A ……………… is a trust that pools the saving of a number of investor who

share a common financial Goal.
a) Custodian
b) Depository.
c) Bank
d) Mutual fund.

8) Which of the following is essential for the Public issue of a debt security?
a) The debt issue size should be greater than Rs 5000 Cr.
b) The debt instrument must be credit rated.
c) The debt issuer stands as guranantor for the payment of principal and
interest.
d) The debt instrument should have a minimum coupon specified.

9) Which of these is not a significant risk while investing in Governance of India

Securities?
a) Price Risk.
b) Reinvestment Risk.
c) Liquidity Risk
d) Credit Risk

10) Commission received from business forms part of income from

………………….
a) Business and profession
b) capital gains
c) Salary
d) Other Source.
11) According to the ………….. people treat money differently depending on
factors such as the money origin and intended use.
a) Capital market Theory.
b) Modern portfolio theory
c) Propoets theory.
d) Mental accounting thheory.

12) The coorelation coefficient between the return on market portfolio and
return of a risk free assets is ……..
a) 1
b) -1
c) 0
d) None of the above.

13) Which of the following is not a correct with respect to values at Risk (Var)?
1) It is a Simple concept and can be easily commuicated.
2) It provides a basis for comparision
3) Correctly estimates the frequency of extreme events.
4) Takes liquidity of assets into account.
a) Ony 1 & 2
b) Only 2 & 3
c) Only 2 & 4
d) Only 3 & 4

14) For a person to be qualified as a NRI , he must have stayed outside India for
more than ………. days in a previous financial years.
a) 365
b) 280
c) 182
d) 150

15) Which of the following would most closely resemble the market portfolio?
a) Stock
b) Stocks and Bonds
c) Stocks bonds and foreign securities.
d) Stocks, Bonds, foreign securities and coins.
16) In a nifty 50 futire contract the underlying is …………………..
a) The top traded stock of the nifty 50 Index.
b) the average price of the stock of the nifty 50 Index.
c) total market capatilization of the Nifty 50 index.
d) the value of the Nifty 50 Index.

17) Typical putability put option feature of a bond ………………

a) Gives the bond holder the option to convert the bond into another security ,
typically the common stock of the firm issuing the convertible bonds.
b) Gives the holder the right under certain circumstances to sell the bond back
to the issuer.
c) Allows the issuing firms to retire the bonds before the maturity by paying a
prescribed price.
d) Allow the investor to redeem the bond.

18) Under the typical assumption that a stock dividend will grow at a discount
rate, what will be the intrinsic value of the stock of D1= Rs 3, K = 9%, g= 6%
a) Rs 95
b) Rs 105
c) Rs 110
d) Rs 100

19) …………………. Risk arises from the fact that income flows received from an
investment at the coupon rate may not be able to earn the same interest?
a) Reinvestment
b) Defualt Risk
c) Credit Risk
d) None of the above.

20) The implication of efficient markets and alack of superior analyst have led
to the introduction of ………………….
a) Life cycle fund.
b) Short extension fund.
c) January funds.
d) Index Funds.
21) Asset allocation is …………………………….
a) The process of dividing funds into assets classes.
b) Concenred with return variability.
c) Concerned with the risk associated with different assets.
d) Concenred with relationship among the investment return.

22) ………… is the central national aency responsible for receiving processing
analyzing and disseminating information relating to suspect financial
transaction to enforcement agencies.
a) FIU-IND
b) SEBI
c) RBI
d) CBI

23) A criticism of a value weighted Index is that …………

a) Large companies have small influences on the index.
b) They are not useful for the OTC market.
c) Large companies have a disproportionate influence on the index.
d) Small companies have a large influence on the index.

24) Future value of the investment is influenced by……………………..

a) Time period
b) Rate of return
c) Both a and b
d) None of the above.

25) What impact does a stock split have on a price weighted series?
a) Index remains the same, divisor will change
b) Divisor remain the same Index will change
c) Index and divisor will both remain same.
d) Index and divisor will both change.
 A Compilation By:--
Bhardwaj Edumotive Consultancy Bengaluru
sanatbharadwaj@gmail.com

1 D 6 A 11 D 16 D 21 A
2 D 7 D 12 C 17 B 22 A
3 C 8 B 13 D 18 D 23 C
4 B 9 D 14 C 19 A 24 C
5 C 10 A 15 D 20 D 25 A