NISM MUTUAL FUND FOUNDATION 10
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Mock Test with Answer key - Click Here >>
Q 1. What is the maximum percentage of perpetual bonds issued by a single issuer that a mutual fund can own?
a) 5%
b) 7%
c) 8%
e) 12%
Q 2. What impact did the dividend distribution tax (DDT) have on the investor's after-tax returns?
a) Increased after-tax returns
b) Decreased after-tax returns
c) Had no impact on after-tax returns
e) None of the above
Q 3. How are bonus and rights units credited to demat account holders?
a) Indirectly through the fund manager
b) Directly into the investor's bank account
c) Through physical certificates
e) Through the regulator
Q 4. What information needs to be provided if units are to be held in a demat account?
a) Name of the bank
b) IFSC code
c) Details of the beneficiary account and name and ID of the depository participant (DP)
e) Copy of the bank passbook
Q 5. In which situations are investors exempt from producing a PAN card for mutual fund investments?
a) Investments made on behalf of the Central/State government
b) Investments in the state of Sikkim
c) Investments by UN entities/Multilateral agencies
e) None of the above
Q 6. What is the purpose of the advertising and public relations campaigns conducted by the AMC during the NFO process?
a) To attract new fund managers
b) To inform investors about the Scheme Re-Opening Date
c) To comply with SEBI's advertising code
e) To distribute profits to existing investors
Q 7. When must investors make their choice of scheme, plan, option, and pay-out option?
a) After making the application
b) Before making the application
c) At the time of redemption
e) Never, it is automatically chosen by the mutual fund company
Q 8. Are there currently mutual fund schemes investing in real estate?
a) Yes
b) No
c) Only in certain countries
e) None of the above
Q 9. What does Modified Duration measure in relation to debt securities?
a) Sensitivity to changes in interest rates
b) Fluctuation compared to a benchmark index
c) Sensitivity to market volatility
e) None of the above
Q 10. What risk is associated with the inability to sell securities held in a mutual fund scheme's portfolio?
a) Credit risk
b) Interest rate risk
c) Currency risk
e) Market risk
Q 11. What is the standard benchmark for an Equity scheme?
a) S&P BSE100 Index
b) NSE 100 Index
c) Sensex
e) AAA Bond Index
Q 12. What is the main difference between diversified funds and focused funds?
a) Investment objective
b) Investment strategy
c) Portfolio diversification
e) Liquidity
Q 13. What risk measurement tool is used for measuring credit risk?
a) Diversification
b) Avoidance
c) Credit rating
e) Credit spreads
Q 14. How do recurring expenses affect investor returns?
a) They have no effect on investor returns
b) Higher expenses lead to higher investor returns
c) Higher expenses result in lower net asset value (NAV) and lower investor returns
e) None of the above
Q 15. How does diversification help manage investment risks?
a) By eliminating all investment risks
b) By concentrating investment in a single asset class
c) By reducing the impact of losses from individual investments
e) By minimizing the need for market knowledge