MCQOPTIONS
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MCQOPTIONS
This section includes 173 Mcqs, each offering curated multiple-choice questions to sharpen your Mutual Fund Management knowledge and support exam preparation. Choose a topic below to get started.
| 101. |
A …………… risk in a mutual fund refers to a situation when the issuer of a stock is unable to maketimely payment of interest and principal to the investors. |
| A. | Business |
| B. | Credit |
| C. | Capital |
| D. | Scheme |
| Answer» C. Capital | |
| 102. |
Which of the following is not a reason why Index funds typically incur lower expenses than othermutual 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» E. | |
| 103. |
NFO stands for_____________ |
| A. | New Funds Offer |
| B. | Net Frauds in Office |
| C. | New Funds in Office |
| D. | Net Frauds Offer |
| Answer» B. Net Frauds in Office | |
| 104. |
A fund with _____ Sharpe ratio than the market is outperforming the market. |
| A. | Lower |
| B. | Higher |
| C. | Average |
| D. | Nil |
| Answer» C. Average | |
| 105. |
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» E. | |
| 106. |
Consolidated Account Statements is sent …………….. to investors in whose folios no transaction hastaken place. |
| A. | every 2 months |
| B. | every 3 months |
| C. | every 4 months |
| D. | every 6 months |
| Answer» E. | |
| 107. |
If Holding Period return are 20% & period is 2 years then Annualized returns ____. |
| A. | 20% |
| B. | 10% |
| C. | 40% |
| D. | 15% |
| Answer» C. 40% | |
| 108. |
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» B. Credit | |
| 109. |
………… funds use algorithmic, in which computer software takes buy/ sell decisions on the basis offormula |
| A. | Value |
| B. | Quant |
| C. | Thematic |
| D. | Arbitrage |
| Answer» C. Thematic | |
| 110. |
………… funds are an extension of sector funds. |
| A. | Value |
| B. | Diversified |
| C. | Thematic |
| D. | Index based |
| Answer» D. Index based | |
| 111. |
UTI Act was enacted in the year ______. |
| A. | 1975 |
| B. | 1955 |
| C. | 1963 |
| D. | 1995 |
| Answer» D. 1995 | |
| 112. |
Expenses incurred that are above the regulatory limit are borne by sponsor & _____ |
| A. | AMC |
| B. | Custodian |
| C. | Agents |
| D. | AMD |
| Answer» B. Custodian | |
| 113. |
Rupee cost averaging means investing fixed amount _________. |
| A. | Periodically |
| B. | Lump sum |
| C. | Yearly |
| D. | Half Yearly |
| Answer» B. Lump sum | |
| 114. |
……………… funds invest in companies of different sectors across the market. |
| A. | Sectoral |
| B. | Diversified |
| C. | Thematic |
| D. | Index based |
| Answer» C. Thematic | |
| 115. |
CAS stands for ………………….. |
| A. | Combined Account Statement |
| B. | Consolidated Account Statement |
| C. | Combined Account System |
| D. | Consolidated Account System |
| Answer» C. Combined Account System | |
| 116. |
Expense ratio for a funds should be as ______ as possible. |
| A. | High |
| B. | Low |
| C. | Average |
| D. | NIl |
| Answer» C. Average | |
| 117. |
Tracking Error of _______ fund has to be minimized. |
| A. | Index Fund |
| B. | Debt Fund |
| C. | Guilt Fund |
| D. | Equity Fund |
| Answer» B. Debt Fund | |
| 118. |
A benchmark once chosen cannot be altered without _________ approval. |
| A. | Custodian |
| B. | AMFI |
| C. | Trustees |
| D. | RBI |
| Answer» D. RBI | |
| 119. |
________ 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» E. | |
| 120. |
Jensen’s Alpha focuses on _____________ |
| A. | Systematic Risk |
| B. | Unsystematic Risk |
| C. | Political Risk |
| D. | Legal Risk |
| Answer» C. Political Risk | |
| 121. |
Risk is less in …………………. |
| A. | Equity fund |
| B. | growth fund |
| C. | index fund |
| D. | debt fund |
| Answer» E. | |
| 122. |
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» E. | |
| 123. |
Technology funds focus on technology-based firms. Which of the following statements regarding thosefirms 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» C. They have the potential for a high return. | |
| 124. |
The AMC and the Trustees enter into an _____ Agreement. |
| A. | Investment Management |
| B. | Memorandum of Association |
| C. | Legal |
| D. | None of the above |
| Answer» B. Memorandum of Association | |
| 125. |
Financial year for all mutual fund schemes ends on …………… |
| A. | 31st December |
| B. | 31st March |
| C. | 30th September |
| D. | 30th June |
| Answer» C. 30th September | |
| 126. |
The ________ can issue offer documents on behalf of the trustees. |
| A. | AMC |
| B. | Custodian |
| C. | Agents |
| D. | AMD |
| Answer» B. Custodian | |
| 127. |
R-squared value range from 0 to …………… |
| A. | 0.5 |
| B. | 0.75 |
| C. | 1 |
| D. | 0.25 |
| Answer» D. 0.25 | |
| 128. |
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» E. | |
| 129. |
If Holding Period return are 25% & period is 2 years then Annualized returns ____. |
| A. | 25% |
| B. | 12.5% |
| C. | 50% |
| D. | 37.5% |
| Answer» C. 50% | |
| 130. |
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» D. Interest and other expenses are not included | |
| 131. |
______ is a tax that is imposed by the government on companies based on dividend paid to a company'sinvestors. |
| A. | dividend distribution tax |
| B. | return on investment tax |
| C. | goods and services tax |
| D. | corporate tax |
| Answer» B. return on investment tax | |
| 132. |
Sponsor must hold at least _______% of the AMCs networth. |
| A. | 30 % |
| B. | 40 % |
| C. | 50 % |
| D. | 60 % |
| Answer» C. 50 % | |
| 133. |
Any grievance against the AMC can be addressed to _______ |
| A. | AMFI |
| B. | DCA |
| C. | Trustees |
| D. | AMF |
| Answer» C. Trustees | |
| 134. |
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» E. | |
| 135. |
The amount by which a close-ended fund's share price in the secondary market is above the fund's NAVis called the |
| A. | market value |
| B. | premium |
| C. | discount |
| D. | par value |
| Answer» C. discount | |
| 136. |
At least _____ % of the AMC directors Should be independent . |
| A. | 30 |
| B. | 40 |
| C. | 50 |
| D. | 60 |
| Answer» D. 60 | |
| 137. |
Scheme take over do not result in merger of ______. |
| A. | Trusts |
| B. | AMC |
| C. | AMFI |
| D. | All of the above |
| Answer» C. AMFI | |
| 138. |
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» C. exempt up to 10% | |
| 139. |
Listed mutual funds have to abide by __________ of the stock exchanges. |
| A. | Listing Regulations |
| B. | Legal |
| C. | Internal |
| D. | None of the above |
| Answer» B. Legal | |
| 140. |
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» B. interest rate risk | |
| 141. |
The UTI is governed by _________. |
| A. | UTI Act |
| B. | Company Act |
| C. | Partnership Act |
| D. | HUF Act |
| Answer» B. Company Act | |
| 142. |
AMCs net worth has to be at least __________ |
| A. | 5 Crore |
| B. | 7 Crore |
| C. | 10 Crore |
| D. | 12 Crore |
| Answer» D. 12 Crore | |
| 143. |
If equity markets move down, dividend yield will move ________. |
| A. | Up |
| B. | Down |
| C. | Sable |
| D. | None of the above |
| Answer» B. Down | |
| 144. |
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» B. International funds invest in U.S. firms and those of other countries while global funds invest only in foreign firms. | |
| 145. |
To calculate the NAV, the market value of the portfolio liabilities is the dividend by the ______ to arriveat 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» C. maximum shear to be issued | |
| 146. |
……………. approve the contents of the Offer document |
| A. | AMC |
| B. | Trustee |
| C. | Custodian |
| D. | Sponsor |
| Answer» C. Custodian | |
| 147. |
_______ mutual funds invest in both foreign bonds and U.S. bonds. |
| A. | International bonds |
| B. | Index |
| C. | Treasury bond |
| D. | Global bond |
| Answer» E. | |
| 148. |
If ______ of unit holders approve , The service of the AMC can be terminated. |
| A. | 50% |
| B. | 75% |
| C. | 60% |
| D. | 40% |
| Answer» C. 60% | |
| 149. |
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» D. from a bank. | |
| 150. |
If equity markets move up, P/E tatio will move ________. |
| A. | Up |
| B. | Down |
| C. | No change |
| D. | None of the above |
| Answer» B. Down | |