NISM Exam

Some close-ended funds are quoted at a discount to their NAV because

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Of high expense ratios
Investors do not expect the current NAV to be sustained in future
The repurchase price fixed by the fund in lower then the NAV
Of the inherent risk involved in investing in such type of funds

Units from an open-ended mutual fund are bought

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On a stock exchange
From the fund it self
From AMFI
From the stock broker

Which of the following fund types, the higest risk is associated with

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Balanced Funds
Gilt Funds
Equity Growth Funds
Debt Funds

Which of the following risk do not affect a debt fund?

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Default issuer on payment of interest or principal
Price flactations of the debt securities
Share price movements
Interest volatility

A fixed Term plan Series is

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An open-ended fund
A close-ended fund
A fixed term bank deposit
A fixed term corporate bond

Which of the following is untrue of an automatic reinvestment plan?

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The plan allows for automatic reinvestment of all income and gains
Automatic reinvestment allows for accumulation of additional units of the fund
The major benefit of automatic reinvestment is compounding
The benefit of automatic reinvestment is often lost on account of the heavy load charge on the heavy load charge on the reinvestment

The performance of a fund is largely measured by the success of

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The marketing function
The operations function
The portfolio market function
None of the above

The maximum load that a fund can change is determined by the :

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AMC
SEBI
AMFI
Disturbution agents based on demand for the fund

Close-ended matual fund has a fixed :

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NAV
Fund size
Rate of return
Number of distributors

Which of the following is not an equity instrument?

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Preference shares
Equity warrants
Ordinary debentures
Convertible debentures

"Load" cannot be recovered

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At the time of the investor entry into the fund
As the fixed amount each year
At the time the investor exit the fund
From the fund's distribution agent

An owner of preference shares is given which of the following rights

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Voting rights
Fixed dividend income from post-tax profits
Voting rights and unlimited dividend income
No guaranteed rights

The NAV of a mutual fund:

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Is always constant
Keeps going up at a steady rate
Fluctuates with market price movements
Cannot go down at all

Debt funds target

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Low risk and stable income
Protedtion of principal
High growth with risk
Low term capital appreciation

An investor in a close-ended mutual fund can get his/her money back by selling his/her units :

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Back to the fund
To the special trust at NAV
On a stock exchange where the funds is listed
To the agent throught which he/she subscribed to the units of the fund

The "load" changed to an investor in a mutual fund is

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Entry fee
Cost of the paper on which the unit certificates are printed
The fee the agent charges to the investor
The expenses incurred by fund managers for marketing a mutual fund scheme

In which of the following do debt funds not invest?

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Government debt instruments
Corporate paper
Financial institution's bonds
Equity of private companies

NAVs of equity funds are not affected by

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Stock market movement
Event affecting the industry sector in which the fund has invested
Happenings in the companies in which the fund has invested
Real estate prices

The NAV of each scheme should be updated on AMFI's website

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Every quarter
Every month
Every hour
Every day

A mutual fund is not

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Owned jointly by all investor
A company that manages investment portfolios of high network individuals
A pool of fund used to purchase securities on behalf of investors
A collective investment vehicle

Generally invest in

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Unlisted
Market-traded
Thinly traded
Privately placed

The drawback of an ordinary share is

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Possibility of capital appreciation
Ownership privilege of the company
Guaranteed dividend income
Do guaranted income or security

The greatest potential for growth in capital is offered by

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Debt funds
Gilt Funds
Growth funds
Balanced funds

The amount required to buy 100 units of a scheme having an entry load of 1.5% and NAV of Rs. 20 is :

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Rs. 2000
Rs. 2015
Rs. 1985
Rs. 2030

A gilt fund is a special type of fund that invests :

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In very high quality equity only
In instrument is used by companies with a sound track record
In short-term securities
In Government securities only

A mutual fund is a owned by

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The Govt.of India
SEBI
All its investor
AMFI

The most important advantage of a money market mutual funds is

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Quick capital appreciation
High regular income
Safety of principal
No loads

An open-ended mutual fund is one that has :

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An option to invest in any kind of security
Units available for sale and repurchase at all times
An upper limit on its NAV
A fixed fund size

Constraints imposed by most funds on check writing are:

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Account balance should not fall below the minimum capital required
Check issued must be for at least the minimum amount specified
Number of check per month must not exceed a specified number
Both (A) and (B)

Assured return or guaranted monthly income plans are essentially

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Hybrid funds
Growth funds
Debt income funds
Sector funds

NISM Exam : Question 1 of 30