Worksheets Name

Exam Questions NISM

Class
Total questions: 50

Worksheet time: 25mins

Date
Instructor name: Saloni Daiya

1. Investors decide first and then look for data to support their views. Which kind of behavioural bias is
this?

a) Herd Mentality b) Familiarity Bias

c) Confirmation Bias d) Recency Bias

2. The returns on investment after adjusting inflation is called ____________

a) Interest Rate Risk b) Real Rate of Return

c) Nominal Rate of Return d) Market Risk Rate

3. If the interest rate moved down, the price of the bond would have moved –

a) Up b) Down

c) Equal to Face Value d) Remained the Same

4. Which of the below is not a high-risk fund?

a) Banking Sector Fund b) Pharma Sector Fund

c) Fixed Income Fund d) Diversified Equity Fund

5. An investor in an active fund bears a cost for the fund management, and takes a risks.

a) Higher, Lower b) Lower, Higher

c) Higher, Higher d) Lower, Lower

6. A regular dividend paying mutual fund scheme can be used for capital appreciation - True or False?

a) TRUE b) FALSE
7. Tax Deferral is a key feature of .

a) Arbitrage Fund b) Liquid Schemes

c) Dividend Option d) Growth Option

8. You are expecting interest rates (yields) to rise in the markets. Where would you invest your money
considering this forecast?

a) Long Terms Debt Funds b) Equity Funds

c) Short Term Debt Funds d) Banking Sector Funds

9. An investor wishes to invest in debt mutual funds but wants high liquidity - should he invest in Fixed
Maturity Plans?

a) No b) Yes

10. Investing in can be a risky prospect during periods of Economic Turmoil.

a) Debt Funds b) Gilt Securities

c) Large Cap Funds d) Mid Cap Funds

11. Post the New Fund Offer, investors who wishes to buy units need to pay .

a) the same price as NFO b) a price linked to the inflation index

c) the NFO price plus inflation rate d) a price that is linked to its NAV

12. Dividend is under the Dividend Reinvestment Plan.

a) Reinvested in the scheme at the Cum Dividend b) Accumulated and paid at the end of financial
NAV to buy additional units year

c) Accumulated and paid once a specific amount d) Reinvested in the scheme at the Ex-Dividend
is accumulated NAV to buy additional units

13. The NAV of Gold Sector Fund directly influenced by the current gold prices - True or False ?

a) FALSE b) TRUE
14. Which of the Following is rated by a credit rating Agency?

a) Equity Oriented Mutual Funds b) All of the Above

c) Debt Funds d) Equity Shares

15. AMFI is a regulatory body & a Self – Regulatory Organisation (SRO)

a) True b) False

16. After passing NISM Certification Examination (NISM Series V A Mutual Fund Distributors (MFD)
Certification Examination), what is the next step from the following?

a) None of the Above b) Get Directly Engaged with Selling Mutual Funds

c) Register with AMFI d) Register with an AMC

17. AGNI (AMFI Guidelines & Norms for Intermediaries) is mandated by ____________

a) AMFI & Securities Exchange Board of India b) Reserve Bank of India

(SEBI)

c) Association of Mutual Funds in India (AMFI) d) SEBI

18. The Mutual Fund Investor can pledge the units

a) False b) True

19. At the time of New Fund Offer (NFO), which document is compulsorily filed with SEBI?

a) Statement of Additional information b) Annual Report

c) Memorandum & Articles of Association d) Scheme Information Document

20. Which of the following statements is ‘False’ with respect to SEBI’s Advertising Code for mutual funds?

a) No celebrities shall form part of the b) Advertisements can carry any slogan that is
advertisement exaggerated or unwarranted or slogan that is
inconsistent with or unrelated to the nature and
risk and return profile of the product.

c) No advertisement shall directly or indirectly

discredit other advertisements or make unfair
comparisons.
21. Mutual Funds are constituted as Investment Companies in India - True or False ?

a) FALSE b) TRUE

22. Who is responsible for implementation of uniform KYC.

a) The Mutual Funds through their PoAs b) Registrars

c) KYC Registration Agencies d) Depository Participants

23. The maintains investor records.

a) The specific fund accountants b) The Fund Manager and his team

c) Registrars and Transfer Agents d) The Back Office of AMFI

24. Who receives and delivers securities on behalf of the Mutual Fund ?

a) Authorised Stock Brokers b) The AMC to which the fund belongs

c) Custodian d) Merchant Bankers

25. To create the investment portfolio for a particular scheme of a MutualFund, the fund manager takes
into account .

a) All of the above b) the investment objective of the scheme

c) the risk profile of the investors d) the age and income of the investors

26. Mutual Fund distributors are appointed by .

a) The Custodian b) SEBI

c) The AMC d) The Trustees

27. Who makes the application to SEBI for registration of a Mutual Fund ?

a) The AMC b) The Sponsor

c) The Trust d) The Fund Manager

28. A distributor needs different AMFI Registration Numbers (ARN) for each Asset Management Company
(AMC)?

a) True b) False

29. A Mutual Fund distributor is paid trail commission for –

a) As long as investor holds the investment b) First 5 years of investment done by investor

c) First 5 years of investment done by investor d) First 5 years of investment done by investor

30. ARN refers to ________

a) Account Registration Number b) Application Registration Number

c) AMFI Registration Number d) Agent Registration Number

31. Distributors do not get Commission on self-business.

a) True b) False

32. Accordingly, the AMC / MF is liable to pay GST under reverse charge on commission paid to
unregistered distributors.

a) False b) True

33. Trail commission is linked to valuation of portfolio in the market

a) True b) False

34. As per the fair valuation principles laid out by SEBI, it is important to disclose the valuation policy in a)
Fund FactSheet

a) Statement of Additional information b) Statement of Accounts

c) The fair value principles are not to be put in

public
35. Which of the Following Expenses are charged to a Mutual Fund Scheme?

a) audit fees b) All of the Above

c) in case of a capital-oriented scheme, rating d) custodian fees

fees

36. AMC can charge investment and advisory fees on the segregated portfolio.

a) True b) False

37. While investing a minimum of sixty-five per cent of assets under management in equity oriented
schemes as per scheme information document, the total expense ratio of the scheme including
weighted average of the total expense ratio levied by the underlyingscheme(s) shall not exceed
___________ percent of the daily net assets of the scheme.

a) 1 b) 2

c) 1.50 d) 2.25

38. Long Term Capital Gain Tax is Debt Schemes is charged at .

a) 20% with indexation b) Lower of 1 and 2

c) 10% without indexation d) There is no tax on Debt Schemes

39. As per the Income Tax Act - which of the below option is True?

a) Capital loss, short term or long term, can be set b) Short Term Capital gains is a tax-free income
off against any other head of income

c) Long term capital loss can be set off against d) Short term capital loss is to be set off against
long term and short-term capital gain short term capital gain or long-term capital
gain

40. At what rate is the Securities Transaction Tax charged on sale of units of debt oriented mutual fund in
a stock exchange?

a) 0.10% b) 0.13%

c) 0% d) 0.001%
41. When investing in Equity, the majority of gains generally come through _____.

a) Capital Gains b) Interest Received

c) Tax Savings d) Dividend Income

42. If a client is investing Rs. 1 Crore at 2.30 pm through cheque in GILT Fund, then which day’s Net Asset
Value will he get?

a) Previous Day NAV b) NAV of the day when funds are realised

c) Next Day NAV d) Same day’s closing NAV

43. Mr. Mohan gives an application for investment in an Equity fund at 3.29 pm on Friday at the AMC's
office. Which will be the applicable NAV ?

a) Highest NAV of the above three b) Saturdays NAV

c) Fridays NAV d) Mondays NAV

44. Minors can invest in Mutual Funds - True or False?

a) FALSE b) TRUE

45. If an Institutional Investor is making an application for investing in a Mutual Fund, which additional
document is required?

a) Bank Statements b) Board Resolution

c) Approval letter from SEBI d) Audited Accounts for the last 3 years

46. What is the full form of ASBA?

a) Applicants Supporting Block Amount b) Application Supported by Blocked Amount

c) Applications Superiority by Blocked Amount d) Application Supported by Bankers Acceptance

47. Which one of the below mentioned document is not required for KYC process?

a) Address Proof b) Identity Proof

c) PAN Card d) Income Proof

48. For next 30 days after a New Fund Offer closes, an investor can buy units at face value - True or False?

a) FALSE b) TRUE

49. For which of these documents is Time Stamping mandatory?

a) Transaction slip for buying additional units b) Payment instrument only

c) Both for Application form / transaction slip and d) Application form only
payment instrument

50. A folio which is held by a _______ CANNOT have a nominee.

a) Trust b) Minor

c) All of the above d) Registered Company