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Security Analysis & Portfolio Management - 1

This document contains a list of attempted questions and answers from a security analysis and portfolio management exam. It includes 20 multiple choice, true/false, and fill-in-the-blank questions on topics like bearish market actions, Dow's principles, return on equity, bond ratings, stock indices, options contracts, futures contracts, and other investment concepts. For each question, the correct answer and the examinee's answer are provided.

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239 views4 pages

Security Analysis & Portfolio Management - 1

This document contains a list of attempted questions and answers from a security analysis and portfolio management exam. It includes 20 multiple choice, true/false, and fill-in-the-blank questions on topics like bearish market actions, Dow's principles, return on equity, bond ratings, stock indices, options contracts, futures contracts, and other investment concepts. For each question, the correct answer and the examinee's answer are provided.

Uploaded by

api-3745584
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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LIST OF ATTEMPTED QUESTIONS AND ANSWERS (Security Analysis & Portfolio Management_1)

Question Bearish actions come from a series of declining peaks and troughs.
Correct Answer True
Multiple Choice Single Answer
Question Who developed Dow's Principles and organised them into a theory as it is known today?
Correct Answer William Peter Hamilton
Your Answer Charles.H.Dow

kk LIST OF ATTEMPTED QUESTIONS AND ANSWERS


Select The Blank
Question ________ is affected by the leverage decisions of the firm.
Correct Answer Return on equity
Your Answer Return on equity

Select The Blank


Question Debentures rated "BB" refers ________ of timely payment of interest and
principal.
Correct Answer Inadequate safety
Your Answer Inadequate safety

Select The Blank


Question S&P NSE 50 index is known as ________.
Correct Answer NIFTY
Your Answer NIFTY

True/False
Question The risk associated to get the required rate of return on the stock is
measure by market beta.
Correct Answer True

Match The Following


Question Correct Answer

NSE&BSE are regulated by Securities Exchange Board of India


Under options contract When you expect prices to fall, then, you
take a long position by buying puts.
A contract where both the parties are equally Futures contract
responsible
The amount which the buyer of the option has to Option price
pay to the option writer to induce him to
accept the risk associated with the contract.

True/False
Question A segment is unattractive if the buyers possess strong or growing bargaining
powers.
Correct Answer True
Your Answer True

Multiple Choice Single Answer


Question Debt instruments that have a maturity period of more than one year are
called as :-
Correct Answer Bonds

1
Multiple Choice Single Answer
Question The present value of all the future cash payments to be paid on the security
to the investor is termed as :-
Correct Answer Intrinsic value of a security

Multiple Choice Multiple Answer


Question What are the features of Retail government securities (G-secs) ?
Correct Answer Safest investment option available , Demat account is required for
investment , Choice of tenure varies from less than 1 year to 30 years

True/False
Question A higher value of current ratio indicates a better short term solvency of the
firm.
Correct Answer True

Select The Blank


Question ________seeks to safeguard against potential losses on the outstanding
position in futures market.
Correct Answer Initial margin
Your Answer Initial margin

Select The Blank


Question Risk can be referred as the ________ in the return with respect to the
expected return.
Correct Answer Volatility
Your Answer Volatility

Multiple Choice Multiple Answer


Question The return to the bond investor can be measured in terms of :-
Correct Answer Current yield , Yield to maturity , Realised yield
Your Answer Current yield , Yield to maturity , Realised yield

True/False
Question Certificate of Deposits offers high rate of interest than Treasury Bills.
Correct Answer True
Your Answer True

True/False
Question American option gives the holder the right, but not the obligation to buy or
sell the underlying instrument on or before the expiry date and the option can be
exercised early.
Correct Answer True

Multiple Choice Multiple Answer


Question Which of the following are important momentum indicators used widely?
Correct Answer Rate of change (ROC) , Relative strength indicator (RSI) , Moving
average convergence divergence(MACD)

Multiple Choice Single Answer


Question What is Gross National Product ?
Correct Answer Gross income generated from within the country
Your Answer Gross income generated from within the country

Select The Blank


Question An ________ is a series of equal payments or receipts occurring at regular
intervals of time.
Correct Answer Annuity
Your Answer Annuity

Multiple Choice Single Answer

2
Question If the price of a share at the beginning of the year was Rs.100/-, no
dividend received during the year and the price at the end is Rs.115/-. What is the rate
of return?
Correct Answer 0.15
Your Answer 0.15

Multiple Choice Single Answer


Question Which market is affected with the improving and higher growth rate in economy?
Correct Answer Stock market
Your Answer Stock market

Multiple Choice Multiple Answer


Question Features of PSU Bonds are :-
Correct Answer No TDS , Transferable by endorsement , No stamp duty on transfer
Your Answer No TDS , Transferable by endorsement , No stamp duty on transfer

Match The Following


Question Correct Answer Your Answer

Ratio used as a measure of relative value PEG ratio


The market value of the firms assets divided by the Market value to replacement cost
replacement cost of these assets ratio
Key determiner of revenue multiples Profit margin
The market value of the equity in a firm reflects the Price to book value ratio
markets expectations of the firms earnings power and
cash flows.

True/False
Question If a rupee weakens against the dollars it has favourable impact for the
exporters.
Correct Answer True
Your Answer True

Multiple Choice Single Answer


Question Credit rating companies assign ratings for which of these investments?
Correct Answer Company deposits
Your Answer Company deposits

True/False
Question If rupee weakens against the dollar, it has favourable impact for the
importers.
Correct Answer False
Your Answer False

Multiple Choice Single Answer


Question What is the objective of Portfolio management?
Correct Answer To Minimize risk and maximize return
Your Answer To Minimize risk and maximize return

Select The Blank


Question Acid test ratio is more stringent measure of liquidity compared to the
________.
Correct Answer Current ratio
Your Answer Current ratio

Multiple Choice Multiple Answer


Question An option is :-
Correct Answer A contract between two parties , Where buyer receives a privilege for
which he pays a premium , Where the seller accepts an obligation
for which he receives a fee

3
Select The Blank
Question ________ is the value at a certain future date today of a stream of cash
flows that occurs over a period of time.
Correct Answer Future value
Your Answer Future value

True/False
Question The basic assumption of Technical analysis is that, price discounts
everything and it is the outcome of all forces affecting a stock.
Correct Answer True
Your Answer True

********************************
Dow Jones transportation average was previously known as Rail average Logistics average
Road average Freight average.

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