NISM Series VIII - Equity Derivatives Exam Series -3
NISM Series VIII - Equity Derivatives Exam Series -3
Access More Mock Tests Now
Q 1. The calendar spread contract for index futures requires a higher margin compared to the combined margin of two separate futures contracts.
FALSE
TRUE
Q 2. In the Indian derivatives exchange, the matching of bids and offers takes place _____.
online and immediately
at the day's end
at the end of each hour
at the end of each minute
Q 3. In India, the clearing and settlement of derivatives trades would be through ______.
State Bank of India
Euroclear
SEBI approved Clearing Corporation / Clearing House
Interbank Clearing House
Q 4. What is the risk of bad delivery in an index futures contract?
The risk does not exist
The risk is very high
The risk is there but quite low
The risk is around 25% of the total deliveries
Q 5. How can risks be controlled in the derivatives segment by the stock exchange?
By implementing an effective margin system
Having a well-organized control system and audit procedures
By periodic evaluation of member positions
All of the above
Q 6. Future contracts are not symmetrical concerning rights & obligations of the parties involved - State True or False?
TRUE
FALSE
Q 7. In India, futures and options on individual stocks are allowed on__________.
Only a few selected stocks only
All stocks are listed on any of the exchanges
All stocks with stock prices of more than Rs.100 or Rs 50 in A and B group resp.
Only those stocks which are simultaneously listed on all the stock exchanges in India
Q 8. Important element(s) of risk management in the derivatives segment is (are) :
Monitoring capital adequacy requirements of members
Regular evaluation of trading members' positions
Collection of Margins
All of the above
Q 9. The relationship between the spot price and the future price is known as _____.
Dividend
Risk premium
Payout difference
Cost of Carry
Q 10. Compared to the other financial products mentioned here, which one is more difficult to understand?
Treasury Bills issued by the Government of India
Index mutual funds replicating indexes like the Nifty
Index options on a broad-based equity index like Nifty
Index futures on a broad-based equity index like Nifty
Q 11. When ordinary cash dividends are declared, the Call Option value will decrease - State True or False?
TRUE
FALSE
Q 12. What is the rate of Securities Transaction Tax (STT) on the sale of an index or stock futures contract?
0.0004
0.000125
0.0005
0.001
Q 13. A future contract ______.
can be traded on a one-on-one basis by counterparties
will never have a specified maturity
can be squared off at any time before expiry
cannot be squared off before expiry
Q 14. A trader is very bearish on specific companies. However, he is bullish on the market as a whole. Which of the following is the most appropriate strategy to take advantage of this view?
sell the shares of those specific companies in futures and also sell index futures
sell the shares of those specific companies in futures and buy index futures
buy the shares of those specific companies in futures and sell index futures.
do nothing
Q 15. If a Clearing member defaults, the margin paid on his account is only allowed to be used by the clearing corporation to realize its dues from the member. Client's margin remains unaffected - State True or False?
TRUE