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Q 1.
Dividends which are paid by mutual funds can be paid out of ________ .
Profits of the Asset Management Company
Mark to Market profits
All realised and unrealised gains
Distributable surplus only
UnAttempted
CORRECT ANSWER:
Distributable surplus only
Explanation:
SEBI guidelines stipulate that dividends can be paid out of distributable reserves. In
the calculation of distributable reserves:
• All the profits earned (based on accrual of income and expenses as detailed
above) are treated as available for distribution.
• Valuation gains are ignored. But valuation losses need to be adjusted against
the profits.
• That portion of sale price on new units, which is attributable to valuation gains, is
not available as a distributable reserve.
Q 2.
In case of a floater Fund, what is the Required Minimum Investment in
floating rate investment of total assets invested ?
65%
45%
55%
75%
UnAttempted
CORRECT ANSWER:
65%
Explanation:
Floater Fund in an open-ended debt scheme predominantly investing in floating rate
instruments (including fixed rate instruments converted to floating rate exposures
using swaps/derivatives).
Minimum investment in floating rate instruments (including fixed rate instruments

converted to floating rate exposures using swaps/derivatives) shall be 65 percent of
total assets.
https://pass4sure.in/mocktest_attempt.aspx?id=1571 07-May-22
Q 3.
The NAV applicable for purchase in a gilt fund of Rs. 50 Lakhs if the
cheque is received after 2 pm will be _____ .
Same day NAV if received before cut off time.
Closing NAV of day immediately preceding the date of application
Closing NAV of the next business day
NAV of the business day on which the funds are available for utilisation
UnAttempted
CORRECT ANSWER:
NAV of the business day on which the funds are available for utilisation
Explanation:
For all type of debt funds (except liquid funds), if the amount is above Rs. 2 lakh,
irrespective of the time of receipt of application, NAV of the business day on which
the funds are available for utilisation without availing of any credit facility before the
cut-off time (3 pm) of that day is applicable.
Q 4.
Business model, experience and proficiency in the business is a
compulsory criteria for empanelment and review of which of the following
category of mutual fund distributors?
Institutional distributors who have points of presence in more than 10
locations
Individual distributors who have points of presence in more than 10 locations
Distributors who have received commission of over Rs. 1 Crore p.a. across
industry
All of the above
UnAttempted
CORRECT ANSWER:
Distributors who have received commission of over Rs. 1 Crore p.a. across
industry
Explanation:
SEBI has mandated AMCs to put in place a due diligence process to regulate
distributors with respect to 'Business model, experience and proficiency in the
business' who qualify any one of the following criteria:
a. Multiple point presence (More than 20 locations)

b. AUM raised over Rs. 100 crore across industry in the non-institutional category but
including high networth individuals (HNIs)
c. Commission received of over Rs. 1 Crore p.a. across industry
d. Commission received of over Rs. 50 Lakhs from a single mutual fund
Q 5.
A creditable benchmark of a mutual fund scheme should be in sync with
the __________ . A. Size of scheme B. Investment objective of the scheme
C. Investment strategy of the scheme D. Expenses ratio of the scheme E.
Asset allocation pattern of the scheme
B, C and E
A, C and D
B, D and E
A and B
UnAttempted
CORRECT ANSWER:
B, C and E
Explanation:
A credible benchmark should meet the following requirements: It should be in sync
with (a) the investment objective of the scheme; (b) asset allocation pattern; and
(c) investment strategy of the scheme.
Q 6.
A mutual fund distributor cannot charge a transaction fee on which of
these transactions?
Systematic Transfer Plan
A new investor making a purchase in a mutual fund scheme
An existing investor making a purchase in a mutual fund scheme
Systematic Investment Plan (SIP)
UnAttempted
CORRECT ANSWER:
Explanation:
Transaction charges do not apply to transactions other than purchases/subscriptions
that result in fresh inflows.
Transactions like switches, systematic transfers, dividend transfers, dividend re-

investment are not eligible for transaction charges.
Q 7.
Equity Linked Savings Schemes (ELSS) are eligible for deduction under
Section 80C of the Income Tax Act. However, such schemes have a lock-in
period of _______ from the date of investment.
3 years from the date of allotment of each individual unit
3 years from the date of original investment even in case of subsequent
purchases
If tax exemption is NOT availed, there will not be any lock-in period
UnAttempted
CORRECT ANSWER:
Explanation:
The lockin period for an ELSS fund is 3 years from the date of allotment of each
individual unit.
So even for a SIP investment, each SIP will have a lockin for 3 years.
Q 8.
When is a Consolidated Account Statement (CAS) dispatched to the
investor?
When ever the investor asks for a CAS
bi-monthly for dormant investors
Every month, before the 10th working day of the following month
When ever there is a transaction in the folio
UnAttempted
CORRECT ANSWER:
Every month, before the 10th working day of the following month
Explanation:
A Consolidated Account Statement (CAS) for each calendar month is sent by
post/email on or before 10th of the succeeding month provided there has been a
financial transaction in the folio in the previous month.
Q 9.
In which categories of stocks do Multi Cap equity funds invest in ?
Mostly large cap stocks only of various companies
Mostly mid cap stocks only of various companies
Mostly small cap stocks only of various companies
A mix of large, mid and small cap stocks
UnAttempted
CORRECT ANSWER:
A mix of large, mid and small cap stocks
Explanation:
Multi cap funds spread the investments across the market capitalization spectrum in
order to try and benefit from the opportunities across the market. They invest in a mix
of large, mid and small market capitalisation stocks.
Q 10.
Which of the following information about mutual fund distributors who
have multiple points of presence (more than 20 locations) must be
disclosed by the AMCs? A) Distributor-wise gross inflows and net inflows
B) Average assets under management C) Total commission and expenses
paid to distributors
B and C
A and C
A and B
All A, B and C
UnAttempted
CORRECT ANSWER:
All A, B and C
Explanation:
For mutual fund distributors having multiple point of presence (More than 20
locations), mutual funds / AMCs need to disclose the total commission and expenses
paid to distributors, disclosures regarding distributor-wise gross inflows
(indicating whether the distributor is an associate or group company of the sponsor
(s) of the mutual fund), net inflows, average assets under management and ratio of
AUM to gross inflows on their respective website on a yearly basis.
Q 11.
Multi Asset Allocation funds invest in at least _____ asset classes with a
minimum allocation of at least 10 percent in each class.
2
3
4
5
UnAttempted
CORRECT ANSWER:
Explanation:
Multi Asset Allocation: An open-ended hybrid scheme investing in at least 3 asset
classes with a minimum allocation of at least 10 percent each in all three asset
classes.
Q 12.
A bond issued by a company has a coupon of 7%. The interest rate in the
market for bonds of similar tenor and credit quality is now 8%. An investor
holding the bond will see _____ .
The market price of the bond going up
The market price of the bond going down
The coupon of the bond going up
No change in the market price
UnAttempted
CORRECT ANSWER:
The market price of the bond going down
Explanation:
In the above question, the interest rates have risen in the economy. If the coupon
(interest rate) rises, then the bond with lower coupon is no longer an attractive
investment. It will therefore lose value.
Q 13.
Return from a fund is 9% and the risk free rate is 5%, the Standard
deviation is 3 & Beta is 1.6. What will be the numerator for calculating the
Sharpe ratio?
3
6
1.6
4
UnAttempted
CORRECT ANSWER:
Explanation:
The formula for Sharpe Ratio is : ( Return Earned - Risk free Return ) / Standard
Deviation
Here the Numerator is 'Return Earned - Risk free Return' and the Denominator is
'Standard Deviation'
Numerator = Return Earned - Risk free Return
=9-5 =4
Q 14.
An mutual fund application form with multiple holders has to be signed by
______ .
Any of the holders
All the holders
Only the first holder
Only the first two holders
UnAttempted
CORRECT ANSWER:
All the holders
Explanation:
The application has to be signed by all the holders irrespective of the mode of
holding.
Q 15.
Which type of transactions are allowed on a stock exchange platform for
mutual fund trading? A - Redemptions B - Fresh subscription C -
Additional purchases
Only B
A, B and C
A and B
B and C
UnAttempted
CORRECT ANSWER:
A, B and C
Explanation:
Investors can now transact in mutual fund units through the stock exchanges. The
units of close-ended funds and ETFs are compulsorily listed on at least one stock
exchange. At the same time, units of open-ended funds are also available through
special segments on the stock exchanges.
Q 16.
When an investment is done by a minor, what is rule regarding Know Your
Customer (KYC) requirement?
No KYC is required
It depends whether the investment is in equity funds or debt funds
KYC will be required only if the transaction is thorough a stock exchange
KYC of the guardian is required
UnAttempted
CORRECT ANSWER:
KYC of the guardian is required
Explanation:
An investment made for a minor (less than 18 years) is done through a guardian who
has to comply with the KYC and PAN requirements and all other formalities as if the
investment was for themselves.
Q 17.
For KYC verification, __________ is not accepted as a photo identity
documentation for Micro SIP’s.
Credit Card
Employee ID cards issued by companies registered with Registrar of
Companies
Card issued to National Pension System (NPS) subscribers
Photo Debit Card
UnAttempted
CORRECT ANSWER:
Credit Card
Explanation:
Credit card is not accepted because it may not be backed up by a bank account.
Q 18.
In an Arbitrage fund, the minimum investment in equity and equity related
instruments shall be ______ of total assets.
50 percent
55 percent
60 percent
65 percent
UnAttempted
CORRECT ANSWER:
65 percent
Explanation:
Arbitrage Fund: An open-ended scheme investing in arbitrage opportunities.
The minimum investment in equity and equity related instruments shall be 65 percent
of total assets.
Q 19.
The average net assets of a fund were Rs 800 crore and the investment
transactions of the fund were Rs 1600 crore. Calculate the Portfolio
Turnover Ratio.
10 times
0.5 times
2 times
20 times
UnAttempted
CORRECT ANSWER:
2 times
Explanation:
Portfolio Turnover Ratio is calculated as Value of Purchase and Sale of Securities
during a period divided by the average size of net assets of the scheme during the
period.
= 1600 / 800
=2
Q 20.
What is the investment of a constant amount at regular intervals in a
mutual fund scheme called ?
Systematic Withdrawal Plan
Value Investing
Systematic Investment Plan
UnAttempted
CORRECT ANSWER:
Systematic Investment Plan
Explanation:
It is considered a good practice to invest regularly, particularly into volatile markets
such as equity markets. Systematic Investment Plan - SIP is an approach where the
investor invests constant amounts at regular
intervals.
Q 21.
By mistake the ARN number is wrongly mentioned in the application form.
How will such an application be processed?
The application will be rejected
It will be returned for rectification
As an Direct Plan application
As a Regular Plan, provided the error being corrected within a time frame
UnAttempted
CORRECT ANSWER:
As a Regular Plan, provided the error being corrected within a time frame
Explanation:
If the wrong ARN code is mentioned in the application form, then the application will
be processed as a Regular Plan.
However, the AMC will contact the investor/distributor for the right ARN code within
30 calendar days of the receipt of the application form. If the error is not rectified
within these 30 days, the application will be reprocessed as a direct application
without charging any exit load.
Q 22.
A mutual fund has the policy of imposing an exit load of 2% for redemption
upto one year and 1% for redemptions beyond one year. If an investor
redeems 2000 units at an NAV of Rs 40 at the end of six months from the
date of investment, what will be redemption amount receivable by the
investor
Rs. 76500
Rs. 79200
Rs. 80000
Rs. 78400
UnAttempted
CORRECT ANSWER:
Rs. 78400
Explanation:
The investor has redeemed the units within a year of investment, so the exit load
applicable is 2%.
2000 units X Rs 40 = Rs 80000
Less 2% exit load : 2% of 80000 = 1600 (80000 x 2 / 100)
Net amount = 80000 - 1600 = Rs. 78400
Q 23.
Stamp duty is required to be paid for which of these mutual fund
transactions? A. New purchases B. Systematic Investment Plan (SIP) C.
Dividend reinvestment D. Systematic Transfer Plan (STP)
A,B and D
Only A
B and D
A,B,C and D
UnAttempted
CORRECT ANSWER:
A,B,C and D
Explanation:
Stamp duty will be applicable to all transactions pertaining to scheme inflows:
• Purchase
• Additional Purchase
• Dividend reinvestment
• Systematic Investment Plan (SIP)
• Systematic Transfer Plan (STP)
• Dividend Transfer Plan (DTP)
Q 24.
Calculate the Treynor Ratio from the following data - Return from a mutual
fund scheme is 7.5 %. The beta is 0.62. The risk free rate of return is 6%.
11.60
4.77
3.08
2.42
UnAttempted
CORRECT ANSWER:
2.42
Explanation:
Treynor Ratio = (Return Earned - Risk Free Return) / Beta
= (7.5 - 6) / 0.62
= 1.5 / 0.62
= 2.42
Treynor Ratio is a risk premium per unit of risk. Higher the Treynor Ratio, better the
scheme is considered to be.
Q 25.
Which strategy can be used to ensure that a mutual fund scheme is
suitable to the investors need and situation ?
Indexation
Dividend Stripping
Asset Allocation
Tax harvesting
UnAttempted
CORRECT ANSWER:
Asset Allocation
Explanation:
Asset Allocation is a process of allocating money across various asset categories in

line with a stated objective which is as per the needs and situation of the investor.
Q 26.
Where are the 'Standard Risk Factors' of a Mutual Fund scheme disclosed?
Fund Fact Sheet
Addendum
Statement of Additional Information (SAI)
Scheme Information Document (SID)
UnAttempted
CORRECT ANSWER:
Explanation:
The Scheme Information Document (SID) highlights two broad categories of risks, (1)
Standard risk factors, and (2) Specific risk factors.
The standard risk factors are the risks that all mutual fund investments are exposed
to whereas there are certain risks specific to individual asset category.
Q 27.
Which certification examination is mandated by SEBI for becoming a
mutual fund distributor in the India?
NCFM Series VA Mutual Fund Distributors
NISM Series VA Mutual Fund Distributors
AMFI VA Mutual Fund Distributors
SEBI VA Mutual Fund Distributors
UnAttempted
CORRECT ANSWER:
NISM Series VA Mutual Fund Distributors
Explanation:
Distributors need to pass the NISM certification Examination (NISM-Series- V-A:

Mutual Fund Distributors (MFD) Certification Examination) and register with AMFI to
become mutual fund distributors in India.
Q 28.
Identify the TRUE statement - A) The AMC is not liable for any losses
suffered by the foreign portfolio investors due to adverse currency
movements B) The AMC has to compensate to foreign portfolio investors
for any losses suffered due to adverse currency movements
Only A
Only B
Both A and B
UnAttempted
CORRECT ANSWER:
Only A
Explanation:
The AMC does not manage currency risk for Foreign Portfolio Investors and it is the
sole responsibility of the Foreign Portfolio Investors to manage or reduce currency
risk on their own.
The Sponsor/Fund/Trustees/ AMC are not liable for any loss to Foreign Investors
arising from such changes in exchange rates.
Q 29.
What can happen if an investor has an Overconfidence bias?
He will make careful investment choices
He will take higher risks in his investments
His portfolio will have all good blue chip shares
He will keep the risks low in his investment portfolio
UnAttempted
CORRECT ANSWER:
He will take higher risks in his investments
Explanation:
Overconfidence : This bias refers to a person’s overconfidence in one’s abilities or
judgment. This leads one to
believe that one is far better than others at something, whereas the reality may be
quite different.
Under the spell of such a bias, one tends to lower the guards and take on
risks without proper assessment.
Q 30.
Which of these is an important criteria for choosing either Growth option
or Dividend option in the same mutual fund scheme?
Returns on the scheme
Fund Manager
Tax status of the investor
Assets Managed by the scheme
UnAttempted
CORRECT ANSWER:
Tax status of the investor
Explanation:
Mutual funds offer options, whereby the investor can let the money grow in the
scheme for several years. By selecting such options, it is possible for the investor to
defer the tax liability.
So if the investor wants to differ his tax payments, he should choose the Growth
option. However, if the tax liability of the investor is low, he can choose the dividend
option so that even the dividend can taxed at a low rate every year.
Q 31.
What should an investor see to evaluate the Consistency of Mutual Fund
scheme performance ?
Point to Point
Standard Deviation
Discrete annual returns
Beta
UnAttempted
CORRECT ANSWER:
Discrete annual returns
Explanation:
The discreet annual returns help in assessing the consistency of the fund’s
performance over different market scenarios.
Discretely compounded interest is calculated and added to the principal at specific

intervals (e.g., annually, monthly, or weekly). Continuous compounding uses a natural
log-based formula to calculate and add back accrued interest at the smallest possible
intervals.
Q 32.
Indian mutual funds cannot invest in ______ .
Real Estate
Art
Securitised Debt
Gold
UnAttempted
CORRECT ANSWER:
Art
Explanation:
Investment in Art is not permitted for mutual funds in India.
Q 33.
What is the role of the custodian of a mutual fund?
To issue statement of funds holding to the investors
To execute the buy and sell orders in the stock market
To keep the safe custody of the securities of the mutual fund scheme
To issue account statements to the Mutual Fund unit holders
UnAttempted
CORRECT ANSWER:
To keep the safe custody of the securities of the mutual fund scheme
Explanation:
The custodian has custody of the assets of the fund. As part of this role, the
custodian needs to accept and give delivery of securities for the purchase and sale
transactions of the various schemes of the fund. Thus, the custodian settles all the
transactions on behalf of the mutual fund schemes.
Q 34.
As per the Principles of fair valuation of mutual funds, the valuation of the
securities shall be ________ .
done aggressively
done conservatively
always rising
reflective of the realizable value of the securities
UnAttempted
CORRECT ANSWER:
reflective of the realizable value of the securities
Explanation:
As per Principle No.1 of SEBI's Fair Valuation Principles -
The valuation of investments shall be based on the principles of fair valuation i.e.
valuation shall be reflective of the realizable value of the securities/assets. The
valuation shall be done in good faith and in true and fair manner through appropriate
valuation policies and procedures.
Q 35.
Identify the duty of a SPONSOR of a mutual fund -
Guards the interest of the mutual fund unit holders
Contributes to the capital of the Asset Management Company
Looks after the day to day administration of the mutual fund
Regularly report to SEBI on the working of the fund
UnAttempted
CORRECT ANSWER:
Contributes to the capital of the Asset Management Company
Explanation:
The application to SEBI for registration of a mutual fund is made by the
sponsor. Thereafter, the sponsor invests in the capital of the AMC.
Q 36.
Which of these documents have to be updated once in a year?
Mandatory portfolio disclosures
Scheme Information Document
Fund factsheet
All of the above
UnAttempted
CORRECT ANSWER:
Scheme Information Document
Explanation:
The Scheme Information Document (SID) of each scheme needs to updated once
every year, accordingly, the scheme performance numbers have to be updated as a
part of this exercise.
Mandatory portfolio disclosures are done every six months and Fund fact sheets are
published every month.
Q 37.
Which amongst the following bias can lead to concentrated portfolio?

Familiarity Bias
Herd Mentality
Overconfidence Bias
Recency Bias
UnAttempted
CORRECT ANSWER:
Familiarity Bias
Explanation:
Familiarity Bias - An individual tends to prefer the familiar over the novel, as the
popular proverb goes, “A
known devil is better than an unknown angel.” This leads an investor to concentrate
the investments in what is familiar, which at times prevents one from exploring
better opportunities, as well as from a meaningful diversification.
Q 38.
Which of these documents is NOT required to be submitted by institutional
investors while investing in mutual funds?
Profit and Loss Statement
PAN card copy
List of authorised signatories
Memorandum of Association and Articles of Association
UnAttempted
CORRECT ANSWER:
Profit and Loss Statement
Explanation:
A Profit and Loss Statement is not required to be submitted by an institutional

investor while making investments in mutual funds.
Q 39.
Asset allocation must primarily match ________ .
Long term value creation
Investment needs
Financial goals
Tax saving needs
UnAttempted
CORRECT ANSWER:
Investment needs
Explanation:
The investor’s need from the investment will determine the asset class that is most
suitable for the investor.
Along with the need from the investment, the investor’s ability to take risk and the
investor’s investment horizon is equally important to select the appropriate
asset class.
Q 40.
______ is / are Non Financial transaction(s) in a mutual fund. A) Switch B)
Pledge of units C) Nomination D) Transmission
A, B and C
B, C and D
A, C and D
C and D
UnAttempted
CORRECT ANSWER:
B, C and D
Explanation:
Pledge of units. Nomination and Transmission are Non Financial transactions in a

mutual fund.
A switch is a redemption from one scheme and a purchase into another combined
into one transaction and is a financial transaction.
Q 41.
Floating interest rate is _________ .
A rate which is payable only on maturity
Base Rate + Spread
Prime rate of lending
the yield on spread
UnAttempted
CORRECT ANSWER:
Base Rate + Spread
Explanation:
Interest rates on floating rate securities are specified as a “Base + Spread”.
For example, 5-year G-Sec + 2 percent, this means that the interest rate that is
payable on the debt security would be 2 percent above whatever is the rate prevailing
in the market for Government Securities of 5- year maturity.
Q 42.
A mutual fund has to report which of the following information of an
investor who comes under the Foreign Account Tax Compliance Act
(FATCA)?
The entire investment value of all the folios of the investor
The identity of the account holders
The identity of the beneficial holders
All of the above
UnAttempted
CORRECT ANSWER:
All of the above
Explanation:
To comply with the requirements of Foreign Account Tax Compliance Act (FATCA),
the mutual fund application form requires information to be provided if the
citizenship/nationality/place of birth/tax residency are places other than India for all
categories of investors, the entire investment value of all the folios held, the identity
of the investors and their direct and indirect beneficiaries and controlling persons etc.
Q 43.
The expenses on ________ cannot be charged to the mutual fund scheme.
Custodian fees
Depreciation on fixed assets of the Asset Management Company
Trustee Fees
Marketing Expenses
UnAttempted
CORRECT ANSWER:
Depreciation on fixed assets of the Asset Management Company
Explanation:
The depreciation on fixed assets of the Asset Management Company cannot be

charged to a particular mutual fund scheme.
Q 44.
The loss booked from a equity investment of 18 months can be set off
against ________ .
Long term capital loss only
Long term capital gain only
Short term capital gain only
Short term capital gain or long term capital gain
UnAttempted
CORRECT ANSWER:
Long term capital gain only
Explanation:
A capital gain or loss from an equity investment of more than than 12 months is
considered as Long term.
Long term capital loss can only be set off against long term capital gain.
Q 45.
If a person has to trade in units of a closed-ended mutual fund on the stock
exchange platform then the units have to be held in _______ .
Dematerialized form
Physical form
UnAttempted
CORRECT ANSWER:
Dematerialized form
Explanation:
Trading in mutual fund units on stock exchange platform can be done only in
dematerialized form.
Schemes, where the money can be recovered from the mutual fund only on closure of
the scheme like a closed-ended fund, are compulsorily listed on a stock exchange. In
such schemes, the investor can sell
the detmaterialzed units through the stock exchange platform to recover the
prevailing value of the investment.
.
Q 46.
Which of these investors is/are exempted from proving PAN deatils for
investments in Mutual Funds?
Systematic investment plans, where annual investment does not exceed Rs
50000
Investors residing in the state of Sikkim
Transactions undertaken on behalf of Central/State government
All of the above
UnAttempted
CORRECT ANSWER:
All of the above
Explanation:
The following categories of investors are exempt from producing PAN:
- In case of transactions undertaken on behalf of Central/State government and by
officials appointed by the court.
- Investors residing in the state of Sikkim.
- UN entities/Multilateral agencies exempt from paying taxes/filing tax returns in India.
- Investments (including SIPs and lump sum investments) in Mutual Fund schemes
upto Rs. 50,000/- per investor per year per mutual fund.
Q 47.
SEBI Advertisement Code for Mutual Funds mentions the various

guidelines to be followed by __________ .
the investors who are interpreting the performance of their investments
the AMC’s while it is advertising the performance of their funds
the distributors while advertising their various services
the fund managers while monitoring the performance of the schemes they
manage
UnAttempted
CORRECT ANSWER:
the AMC’s while it is advertising the performance of their funds
Explanation:
There are various guidelines laid down by SEBI which have to follwed by the
AMC while it is advertising the performance of its funds.
For eg - a) Performance advertisement of mutual fund schemes shall be provided in

terms of CAGR for the past 1 year, 3 years, 5 years and since inception.
b) Where the scheme has been in existence for less than one-year, past performance
shallnot be provided ..etc.
Q 48.
Which document will an investor look at if he has to know the fundamental
attributes of a mutual fund scheme?
Key Information Memorandum (KIM)
Addendum
Statement of Additional Information (SAI)
UnAttempted
CORRECT ANSWER:
Explanation:
The Scheme Information Document contains the fundamental attributes of a scheme

under the 'Information about the scheme' column.
Q 49. Return from a fund is 11.5% and the risk free rate is 7%, the Standard
deviation is 3 & Beta is 1.9. What will be the denominator for calculating
the Sharpe ratio?
4.5
3
1.9
11.5
UnAttempted
CORRECT ANSWER:
Explanation:
The formula for Sharpe Ratio is : ( Return Earned - Risk free Return ) / Standard
Deviation
Here the Numerator is 'Return Earned - Risk free Return' and the Denominator is
'Standard Deviation'
So the Denominator is the Standard Deviation = 3
Q 50.
With respect to the procedure for getting empanelled as a mutual fund
distributor with AMC, the applicant needs to sign a declaration for
_______ .
Guarantee of adding a minimum of 5 investors every month
declaring the rebates given back to the investors
ensuring that all employees who are selling mutual funds will have more than
on ARN code
Commitment to abide by statutory codes, guidelines and circulars
UnAttempted
CORRECT ANSWER:
Commitment to abide by statutory codes, guidelines and circulars
Explanation:
The applicant needs to sign a declaration which provides for, among other
conditions, the commitment to abide by instructions given, as also statutory codes,
guidelines and circulars.
Out of 50 questions 50 are un attempted.

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Welcome to Pass4Sure Page 1 of 26

Distributable surplus only

Minimum investment in floating rate instruments (including fixed rate instruments

a. Multiple point presence (More than 20 locations)

Systematic Transfer Plan

Transactions like switches, systematic transfers, dividend transfers, dividend re-

3 years from the date of allotment of each individual unit

A mix of large, mid and small cap stocks

The market price of the bond going down

Numerator = Return Earned - Risk free Return

All the holders

KYC of the guardian is required

Systematic Investment Plan

2000 units X Rs 40 = Rs 80000

Less 2% exit load : 2% of 80000 = 1600 (80000 x 2 / 100)

Net amount = 80000 - 1600 = Rs. 78400

Treynor Ratio = (Return Earned - Risk Free Return) / Beta

Asset Allocation is a process of allocating money across various asset categories in

Scheme Information Document (SID)

NISM Series VA Mutual Fund Distributors

Distributors need to pass the NISM certification Examination (NISM-Series- V-A:

He will take higher risks in his investments

Tax status of the investor

Discrete annual returns

Discretely compounded interest is calculated and added to the principal at specific

Investment in Art is not permitted for mutual funds in India.

reflective of the realizable value of the securities

As per Principle No.1 of SEBI's Fair Valuation Principles -

Contributes to the capital of the Asset Management Company

Scheme Information Document

Which amongst the following bias can lead to concentrated portfolio?

Profit and Loss Statement

A Profit and Loss Statement is not required to be submitted by an institutional

Pledge of units. Nomination and Transmission are Non Financial transactions in a

Base Rate + Spread

All of the above

Depreciation on fixed assets of the Asset Management Company

The depreciation on fixed assets of the Asset Management Company cannot be

Long term capital gain only

All of the above

SEBI Advertisement Code for Mutual Funds mentions the various

the AMC’s while it is advertising the performance of their funds

For eg - a) Performance advertisement of mutual fund schemes shall be provided in

Scheme Information Document (SID)

The Scheme Information Document contains the fundamental attributes of a scheme

So the Denominator is the Standard Deviation = 3

Commitment to abide by statutory codes, guidelines and circulars

Out of 50 questions 50 are un attempted.

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