NISM Series XIX-C AIF Managers Certification Exam - 39
NISM Series XIX-C AIF Managers Certification Exam - 39
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Q 1. What is the formula for calculating the value of a price-weighted index?
a) (Sum of current prices of constituent securities) / Divisor
b) (Sum of market values of constituent securities) / Divisor
c) (Sum of earnings of constituent securities) / Divisor
d) (Sum of the returns on equity of constituent securities) / Divisor
Q 2. Why do style indexes generally have higher turnover than broad market indexes?
a) Because they focus on sector representation
b) Because they focus on historical performance
c) Because valuation ratios change over time
d) Because they track specific investment strategies
Q 3. What role do indices play in assessing systematic risk?
a) They eliminate systematic risk
b) They provide diversification
c) They serve as proxies for the market portfolio
d) They predict future market trends
Q 4. What is the purpose of setting up a Supervisory Committee by the manager of a fund?
A) To replace the mandatory consent of the Investors for certain matters
B) To oversee the day-to-day operations of the fund
C) To make investment decisions on behalf of the Investors
d) To manage the fund's marketing and promotional activities
Q 5. What type of investors are Private Equity funds primarily?
a) Individual investors
b) Institutional investors
c) Government investors
d) Angel investors
Q 6. What determines the nature of positions taken in equities or derivatives contracts in a Long-only Equity Strategy?
a) Market volatility
b) Regulatory requirements
c) Investment manager's discretion
d) Industry trends
Q 7. What is the main purpose of the full ratchet method in anti-dilution calculations?
a) To protect the interests of the founders
b) To calculate the new issue price based on future growth parameters
c) To convert preference shares into equity shares at the lowest available price
d) None of the above
Q 8. What type of analysis is commonly used for fair valuation in the Long-Short Equity Strategy?
a) Technical analysis
b) Fundamental analysis
c) Quantitative analysis
d) Sentiment analysis
Q 9. What is the primary focus of private equity (PE) investments?
a) Early-stage companies
b) Start-ups with high growth potential
c) Mature businesses in traditional industries
d) Cryptocurrency projects
Q 10. What are some of the key metrics angel investors consider while evaluating start-ups?
a) Revenue growth rate
b) Market share
c) Customer Lifetime Value (CLV)
d) Profit margin
Q 11. What triggers the activation of a liquidation preference?
a) Sale of company shares or substantial assets
b) Hiring new employees
c) Launching a new product line
d) None of the above
Q 12. What are some central themes in fund governance?
a) Limited transparency and reporting
b) High levels of conflicts of interest
c) Outsourced independent valuation
d) Lack of segregation of functions
Q 13. During which phase of due diligence does the IDD process begin?
a) Before signing the term sheet
b) After finalizing the legal documentation
c) During the negotiation phase
d) None of the above
Q 14. Who are considered key service providers in the context of fund governance?
a) Retail investors
b) Individual shareholders
c) Custodians, prime brokers, and administrators
d) Regulatory authorities
Q 15. What risk does a high Beta signify in the context of the Market-Neutral Strategy?
a) Market risk
b) Systematic risk
c) Liquidity risk
d) Operational risk