SEBI - Investor Certification Examination
SEBI - Investor Certification Examination
Q 31. What is the purpose of diversification?
To increase risk
To limit returns
To maximize losses
To focus on a single asset class
Q 32. How should assets be allocated depending on financial goals?
By focusing only on equity investments
By concentrating investments in a single asset class
By distributing investments across various asset classes
By investing in high-risk assets only
Q 33. What is the importance of asset allocation?
It guarantees high returns
It eliminates all risk
It minimizes risk and balances potential returns
It focuses only on long-term investments
Q 34. What is the purpose of diversification within asset classes?
To maximize risk
To increase losses
To minimize returns
To concentrate investments in a single asset
Q 35. What is the primary focus when choosing the right investments for long-term goals?
Minimizing returns
Maximizing returns with diversified asset allocation
Ignoring diversification
Limiting potential growth
Q 36. What does diversification aim to achieve?
Maximizing losses
Minimizing risk
Ignoring returns
Focusing only on short-term gains
Q 37. Why is diversification important in investing?
To increase risk
To concentrate investments in a single asset
To minimize risk by spreading investments
To focus only on short-term gains
Q 38. What does asset allocation consider when distributing investments?
Age and lifestyle only
Family commitments only
Risk tolerance only
Investment horizon only
Q 39. What is the primary goal of diversification?
To maximize risk
To minimize risk
To limit returns
To focus on a single asset class
Q 40. How does asset allocation contribute to achieving financial goals?
By focusing only on short-term investments
By minimizing returns
By maximizing risk
By avoiding diversification
Q 41. What should be considered when classifying financial goals?
Only short-term goals
Only long-term goals
Short-term, medium-term, or long-term time horizons
Only medium-term goals
Q 42. What is the final step in achieving financial goals?
Choose the right investments
Identify specific financial goals
Classify goals into short-term, medium-term, or long-term
Review and revise financial plans
Q 43. Which investment product is considered relatively low risk?
Fixed income securities
Equities
Mutual funds
Cryptocurrencies
Q 44. What are the three pillars of investment?
Risk, return, and safety
Safety, liquidity, and return
Return, liquidity, and risk
Liquidity, safety, and risk
Q 45. Which pillar of investment is about the ease of converting investments into cash?
Safety
Liquidity
Return
Stability