NISM Series V-A

Chapter 5 to Chapter 8
Question Set.

# QUESTION OPTION A OPTION B OPTION C OPTION D

Investor has read the OD and
Gets remedy from Gets remedy Gets remedy
1 then the invested in the fund Cant sue the AMC
SEBI from AMC from NSE
and fund goes down, then he
Which of the following is Churning All the associates
Keeping the
against the ethics & Code of investor's money of a distributor
interest of all All of the above
conduct guideline of AMFI to get better should be AMFI
unitholders
2 returns approved.
3 In case of breach of Code of AMFI SEBI Sponsor AMC
conduct, license is canceled
Through monthly Only on AMFI's Once in every six
Factsheet website months in one
Unaudited accounts of the National & one Only on AMC's
scheme must be published Regional website
newspaper
4
5 Which of the following is a BSE SEBI AMFI RBI
Self Regulatory Organization
6 Bank owned mutual fund s SEBI both SEBI & RBI RBI AMFI
are supervised by
If a scheme is launched in the Within 3 months of With 3 months Within 3 months Within 6 months
second months of financial the end of the from the begining from the end of of the end of the
year the the 1st update of the financial Year of Next financial the next financial financial Year
7 SID is due within year year
8 Legally SAI is the part of SID TRUE FALSE
If a scheme is launched in the
first 6 months of the financial
year then the first update of
2 6 5 3
the SID is due with in
months of the end
9 of the financial year .
The asset management
company shall confirm that a Chief Executive Chif Financial Compliance Any of the
10
due diligence certificate is Officer Officer Officer above
signed by the
The mutual fund would update
the current expense ratios on
the website within 5 7 2 10
working days mentioning
11 the effective date of the
Offer documents of mutual
12 fund schemes are approved TRUE FALSE
by SEBI
13 SID is approved by Investor Sponsor AMC and Trustee Custodian

To provide To report the

To give the
To enable adequate performance of
Which of the following is the Fund Manager's
comparison of information about scheme
function of an offer document commentary on
MFs the scheme to the
the market
14 investors
Which of the following is not a Liquidity
Investment Name of the Fund Investment
15 fundamental attribute of a Provisions
Objective Manager Pattern
scheme?
 Which of the following is a Memorandum of Statement of
Key Information
synopsis of the offer Trust Deed Association Additional
Memorandum
16 document? Information
is provided by
is prescribed by is prescribed by Varies to AMC to
17 The format of KIM the Stock
SEBI AMFI AMC
Exchange
Which of the following form a
Investment Performance of
18 part of fundamental attributes Fund Manager All of the above
Objective last 3 years
of a scheme?
19 KIM is to be updated Once in a quarter Once in a month Once in a year Once in 2 years

is changed on MF is not relevant

The names and background
20 is included in SID website every day is included in SAI at all in any
of key personnel in AMC
documents
Unaudited accounts of the
None of the
21 scheme must be published in Every 3 months Every 6 months Every 12 months
above
the news
At the time of NFO, which Memorandum
22 document is to be SID SAI Annual Report and Articles of
compulsorily filed with SEBI Association
Details of Key Expense and Due diligence
Which of the following is not
23 personnel of AMC Tax benefits of MF Load structure of certificate of
included in KIM
the fund. AMC
The information regarding the
category of investors who can
24 Offer document SAI MIN SIN
invest in Mutual Funds, is
given in
25 Standard risks are Uncommon to all Common to all Specific to a Systematic
scheme
26 Offer Document is same as SID SID and SAI SAI KIM sumarry of
SAI + SID.
27 Material changes in KIM Half-yearly Whenever Once in two
needs to be updated Once in material changes years
a year take place

Where In KIM does it mention

that 65% investment will be in Objective of Portfolio of
28 Policy of scheme SAI
equity and equity related scheme scheme
instruments?
29 KIM is attached with Transaction slip Application Form Both A and B Don’t Know
30 The expected return & yield of TRUE FALSE
the scheme is mentioned in
KIM
Details of Minimun Investment None of the
31 Application form Nomination Form KIM
& how to buy units is provided above
A fund which seeks to grow in
value overtime can be said to Capital
32 Safety of capital Capital adequacy Regular income
have it's investment objective appreciation
as
Which of the following entities
33 reaches MF products beyond The Brokers The Custodian The Distributor R & T Agents.
geographical locations
Such distributor Such distributor is Such Distributor
and its approved by AMFI is registered with
A distributor can be representative has Stock Exchange Approved by
empaneled by AMC only if / have cleared SEBI
certifying Exam
34
 In hoardings / posters, the
statement , “ Mutual fund
investments are subject to
6 9 5 8
market risks..." should at least
be
35 inches height .
Who among the following AUM raised over Commission
AUM raised over
would qualify for due diligence Rs. 1 crore from received from None of the
Rs.50 Lacs from
process by AMCs, accroding all the more than 20 Above
HNIs
36 to recent mandate of SEBI AMCs locations
the time
Distributors are provided
37 3 yrs 5 yrs 10 yrs investors stay
commission for up to
invested
SEBI is responsible to
38 develop a cadre of well TRUE FALSE
trained agents and distributors
Mutual Fund Certifying
Examination is mandatory for
39 TRUE FALSE
Individuals from Exempted
Category
Equity Broker NISM certified & Equity broker who
Who can distribute mutual without AMFI registered is NISM Certified
None of the
40 funds through stock certification member but not AMFI
above
exchange? Registered

In India one can invest in a

41 Mutual Fund only through TRUE FALSE
distributor
Security Empanelment
Which of the following is transaction of Distributor of
Inter Scheme
42 prohibited as per AMC's Code Front Running through MF through
transfer
of Ethics associated broker AMC

Sub-brokers / sub-agents Distribution

43 Online platform Banks IFAs
work with Companies
According to Performance
Advertisements the return
44 Annualised Yield Simple Return Absolute return CAGR
shown for equity funds over 1
year is
45 Code of ethics for employees SEBI AMFI Internal Audit Trustee.
of AMC is prescribed by Team
For a distribution channel,
65% of the employees who
46 are engaged in selling MFs TRUE FALSE
should have AMFI
Registration Number
47 Distributors do not get TRUE FALSE
commission on self business
Trail commissions are linked
48 to valuation of portfolio in the TRUE FALSE
market
49 SEBI doesn't allow passing of Distributor Investor Bank IFA
commission to
Institutional distributors needs Registered with Registered with Listed on stock
50 All of Above
to be SEBI AMFI exchange
51 Mutual fund distributors in TRUE FALSE
India are members of AMFI.
 Emerging or new channel for
None of the
52 distribution / marketing of Internet Stock Exchange All of the above
above
mutual funds in India is
An investor The investor An agent invests An Agent retain
A trail commission is justified cancels his redeems his his own money, the Investment
when investment investment in a not that of a client
53 very short time.
When a dividend is paid , the
54 NAV of the unit falls to the TRUE FALSE
extent of dividend paid.
55 The difference between NAV Entry Load Exit Load Contigent Expense
and repurchase price is Deferred Sales
Charge
56 NAV of Income Funds is to be 4 3 2 1
calculated upto
decimals
Transaction Charges for the At the discretion
At the discretion
57 first time investor of Mutal Rs. 100/- Rs. 150/- of the distributor
of Customer
Funds is
Transction Charges of either
Rs.100/- or Rs.150/-
according to the investor
TRUE FALSE
category is deducted by the
AMC from the subscription
58 amount and paid to the
Transaction charge is Rs.10,000/- and
None of the
59 applicable only for Investment Rs.100/- & Above Rs.1000/- & Above Above
Above
of
60 Opting Out of transaction Investor's Level Distributor's Level AMC's Level AMFi's Level
charges shall be available at
Service tax on brokerage and
transaction cost paid for asset
61 TRUE FALSE
purchase, is beyond the
prescribed limit for the
Purchase of debt Redemption of Redemption of
62 STT is applicable on All of above
fund debt fund equity fund
Investor holds 1200 units in a
scheme and that scheme depends on
63 300 400 3600
declares 1:3 bonus. How NAV
many units will the investor
64 Can liquid funds invest in Yes No
short term bank fixed
65 Dividend distribution tax in Nil 10.00% 12.50% 30.00%
liquid fund payable by investor
Fund Management Marketing and
Fee R & T Selling Expenses
66 Recurring expenses includes All of above
Fees

67 There is no TDS on dividend TRUE FALSE

distribution and redemption
Investor should invest in MF
68 with few offices as office TRUE FALSE
expense is charged to the
With-holding tax on income
earned by NRI depends on
the nature of income, nature TRUE FALSE
of investment and investor's
69 country of domicile
 Transfer of close Purchase and
70 Loads are applicable to Redemption Purchase
ended Scheme redemption
An investor looking for a tax Equity Oriented Debt oriented
71 benefit in a hybrid fund must Conservative MIP Balanced Fund Balanced Fund Aggressive MIP
choose
The expense ratio is affected Average account Portfolio Stock market
72 Fund size
by size composition conditions
73 In a mutual fund investors Liabilities Unit capital Deposits None of the
subscriptions are accounted above
for as
A scheme can distribute Realized & None of the
74 Realized profit Profit after tax
dividend on its Unrealized profit above
In which of the following funds Exchange Traded
75 the investor generally bears Funds Balanced funds Commodity funds Fund of Funds
the highest expenses?
In a balance fund with net
assets of 750 crores what is
76 10.13 15.38 17.86 16.125
the maximum expenses that
can be charged?
What is the maximum
77 management fee limit in a 2.25% 1.75% 0.75% 1.50%
Fund of Fund scheme?
Interest / Dividend Expenses of the
The Profitability of a scheme Gain / Loss in the
78 in the scheme scheme All of the above
is impacted by portfolio
79 Initial issue expense that can NIL 1.00% 2.00% 1.75%
be charged to fund is
Market value is 152 crore,
Dividend accrued but not
received is 8 cr, liabilities is 2
200 210.667 213.33 None of above.
cr and No.of outstanding units
is 75 lakhs, the NAV of the
80 scheme is
81 Mutual Fund is exempted TRUE FALSE
from Wealth Tax
NAV on the date NAV of the date
when trustee when notice is
NAV after the None of the
Cum-dividend NAV is approves issued to trustees
date of dividend. above
dividend to finalize the
82 dividend.
Salary of Fund General
Which of the following can be Fees of
Administratives Office rent Administration
charged to the scheme Custodian
83 Expenses
What would be the
84 redemption value of a Unit if 15 15.15 14 14.85
NAV is 15 and Exit load is 1%
Investor holds 2000 Units,
scheme declared 1:4 bonus. Depends on
85 400 500 8000
How many units will the NAV
investor get?
Expenses on General
Which of the expenses cannot investor administration
Service tax Fees of custodian
be charged to scheme? communication expense of
86 AMC
Calculate the Sale price of a
87 unit when NAV is 15 and exit 15 14.85 15.15 15.5
load is 1%
88 STT charges are applicable to Equity Mutual Equity Derivatives Equity Schemes All of Above
Fund
89 Additional Total Expense 15 bps 20 bps 30 bps None of the
Ratio can now be charged above
Additional TER can be atleast 30% of atleast 15% of
charged for new inflows Gross New Inflows Average AUM of
90 Higher of A or B All of the above
beyond T-15 if such inflows in the scheme the scheme
are
91 Separate NAVs for Direct September 13, October 1, 2012 December 10, January 1, 2013
Plans has been w.e.f 2012 2012
92 Fund Management cost is Passive Fund Active Fund Liquid fund insufficient data
more in
The investments in a Mutual Face value of Market value of Book value of
93 Cost of investment
Fund portfolio are valued at portfolio portfolio portfolio
94 Exit loads are generally lower TRUE FALSE
for large investors.
SEBI has put a stop on
Recurring
95 charging Exit load Entry Load CDSC
Expenses
to the
Capital gain or loss from
96 mutual fund investments are 9 months 6 months 12 months 13 months
classified as a short term if
An investor who has invested
Rs.1,00,000 / in a 370 day 20% with
97 7750 750 Insufficient data
FMP and got Rs. 1,07,750/-, indexation benefit
the capital gain in this case is
Payable when Payable when Payable when Payable when
investor buys the investor sells the investor buys the investor sells
Which of the following is true
units of units of units of debt the units of debt
regarding STT
equity Mutual fund equity Mutual fund mutual fund mutual fund
98
Liquid funds cannot charge
management fees on funds
99 TRUE FALSE
parked in a short term bank
deposits.
For an investment Rs.12,000
whose NAV is 12/- per unit
100 <1000 1000 1200 Insufficient data
and Face Value is Rs.10/-, the
number of units alloted would