NISM Series XIX-C AIF Managers Certification Exam - 17

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Q 1. How does the definition of NRI differ between FEMA and the Income Tax Act, of 1961?

a) FEMA classifies NRIs based on their residential status only

b) The Income Tax Act 1961 gives preferential treatment to NRIs

c) FEMA considers only citizens of India as NRIs, while the Income Tax Act of 1961 includes OCI holders

d) None of the above
 
Q 2. How should financial information be provided to bodies, corporations, and trusts seeking accreditation?

A) Financial information from the previous financial year

B) Financial information as per the most recent internal audit

C) Financial information as per the statutory audit

d) Financial information from the last five years
 
Q 3. What is the ownership basis for identifying Ultimate Beneficial Owners (UBOs) structured as a company?

a) 25 percent ownership or control

b) 15 percent ownership or control

c) 50 percent ownership or control

d) None of the above
 
Q 4. What action must AIFs take if their shareholding or voting rights in an investee company aggregate to five percent or more?

a) Disclose their aggregate shareholding and vote within two working days

b) Submit a report to SEBI

c) Increase their shareholding

d) All of the above
 
Q 5. What is the minimum continuing interest required for the Manager or Sponsor of a Corporate Debt Market Development Fund (CDMDF)?

a) INR 1 crore

b) INR 2 crore

c) INR 5 crore

d) INR 15 crore
 
Q 6. What is the primary focus of venture capital investing?

a) Investing in well-established companies

b) Providing financing to government projects

c) Direct investment in early-stage companies

d) Providing loans to established businesses
 
Q 7. What is a common limitation associated with alternative investments?

a) Transparency

b) Simplified contractual terms

c) High liquidity

d) Standardized investment templates
 
Q 8. What types of investors typically contribute funds to Alternative Investment Funds (AIFs)?

a) General public

b) Institutional investors and high-net-worth individuals

c) Retail investors

d) Small businesses
 
Q 9. How does investing in mutual funds contribute to risk reduction?

a) By guaranteeing returns

b) Through active trading in the stock market

c) By investing in high-risk assets

d) Through speculative investments
 
Q 10. When was the term "hedge funds" first used?

a) 1920

b) 1935

c) 1949

d) 1960
 
Q 11. What distinguishes equity shares from other types of investments?

a) Fixed income stream

b) Limited liability

c) Right to vote on company affairs

d) Guaranteed returns
 
Q 12. Why are institutional investors interested in exploring new avenues for diversification?

a) To minimize investment risks

b) To maximize regulatory oversight

c) To guarantee high returns

d) To achieve improved returns and diversification
 
Q 13. What is one direct outcome of the observed anomaly related to book value to price ratio in the context of investment strategies?

a) Emergence of speculative trading

b) Decrease in market volatility

c) Introduction of complex trading algorithms

d) Increase in market efficiency
 
Q 14. How does indexing capitalize on the concept of market efficiency?

a) By encouraging speculative trading

b) By minimizing transaction costs and tax implications

c) By relying on market trends for investment decisions

d) By discouraging long-term investment strategies
 
Q 15. Under the weak form of efficiency, what does the current market price fully reflect?

a) All future expectations

b) All historical information

c) All private information

d) All technical analysis
 
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