NISM DEPOSITORY OPERATIONS - 5
nism-depository-operations-5
Mock Test with Answer key - Click Here >>
Q 1. ______ can write an option in the Indian stock market.
Common individuals
Market makers
Foreign Financial Institutions (FFIs)
All of the above
Q 2. Future prices are usually more transparent than Forward prices - State True or False?
TRUE
FALSE
Q 3. When there is a ‘Closing buy transaction’, this will have the effect of partly or fully offsetting ________ .
A cross position
A short position
A high position
Long position
Q 4. Which of the following options will result in creating a BEAR SPREAD?
One long put has a higher strike price, and one short put has a lower strike price.
Buying one put and buying one call at the same strike/
Selling one call and buying two puts at the same strike
None of the above/
Q 5. What does a Beta of 1 mean?
This means that the expected percentage in stock price will be greater than the percentage change in the index.
It means that the expected percentage in stock price will be twice the percentage change in the index
It means that the expected percentage in stock price will be less than the percentage change in the index
It means that the expected percentage in stock price will be equal to the percentage change in the index
Q 6. A calendar spread in index futures is treated as _________ in a far-month contract when the near months contract is expired.
long position
hedged position
naked position
Short position
Q 7. A trader sells a lower strike price CALL option and buys a higher strike price CALL option, both of the same scrip and same expiry date. This strategy is called _______ .
Bearish Spread
Bullish Spread
Long term Investment
Butterfly
Q 8. As an option moves more In The Money, the absolute value of Delta will ______.
Increase
Decrease
Remain same
None of the above
Q 9. Delta is the change in option price given a one percentage point change in the risk-free interest rate - State True or False ?
FALSE
TRUE
Q 10. Broker are allowed to and expected to fund margin requirements of their clients - State True or False ?
TRUE
FALSE
Q 11. For a derivative exchange, the networth requirement for a clearing member is always less than that for a non clearing member - State True or False ?
TRUE
FALSE
Q 12. If the interest rate increases, the premium on CALL option will also increase - State True or False ?
TRUE
FALSE
Q 13. An ideal index should contain ____ shares
More than 50
As many as possible
As few as possible
As per the objective of the index
Q 14. Is it true that a buyer of a CALL OPTION cannot lose more than the option premium paid ?
TRUE only for European options
TRUE only for American options
True for all types of options
False for all types of options
Q 15. Losses on derivative transactions can be set off against any other income during the year. In case the same cannot be set off, it can be carried forward to the subsequent assessment year and set off against any other income of the subsequent year. Such losses can be carried forward for a period of ____ assessment years.
4
8
12
16