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—— a vehicle (in the form of a “trust”) to mobilize money from investors, to invest in different markets and securities, in line with stated investment objectives.
Every mutual fund scheme has a pre-announced investment objective.
A mutual fund scheme with an objective of providing liquidity would invest in—-
A mutual fund scheme that aims to generate capital appreciation over long periods, would invest in—
The investment that an investor makes in a scheme is translated into a certain number of ‘——’ in the scheme
Typically, every unit has a face value of —-. The face value is relevant from an accounting perspective
The true worth of a unit of the mutual fund scheme is called:
The sum of all investments made by investors’ in the mutual fund scheme is the entire mutual fund scheme’s size, which is also known as the scheme’s—-
asset under management=
The process of valuing each security in the investment portfolio of the scheme at its current market value is called—-
Mutual funds offer investors the opportunity to earn an income or build their wealth through professional management of their investible funds.
MUTUAL FUNDS DOES NOT PROVIDE DIVERSIFICATION OF PORTFOLIO.
Which of the following are advantage of mutual fund?
Mutual fund provides liquidity but not transparency
The unit holder can influence what securities or investments the scheme would invest into.
A mutual fund is not a guaranteed return product.
Which of the following are disadvantages of mutual fund?
Mutual fund is set up as:
Mutual fund is set up as trust under which act:
When a scheme is first made available for investment, it is called a —-
The asset class in which a fund will invest will be defined by
—– Funds are open for investors to enter or exit at anytime, even after the NFO.
—- Is for a fixed period or tenor. It offers units to investors only during the new fund offer (NFO)
Interval funds combine features of both open-ended and close-ended schemes. They are largely close-ended, but become open-ended at pre-specified intervals.
—- Invest the money in the companies represented in an index such as nifty or Sensex in the same proportion as the company’s representation in the index. There is no selection of securities or investment decisions taken by the fund manager as to when to invest or how much to invest in each security.
—- Select stocks for the portfolio based on a strategy that is intended to generate higher return than the index.
—– Invest in equity shares across various sectors, sizes and industries.
—- Invest in multiple sectors and stocks falling within a theme.
— Invest in a given sector.
Equity funds may focus on a particular size of companies (Based on Market Capitalization) to benefit from the features of such companies.
— Invest in companies with high dividend yield
— Restrict portfolio to a particular number of selected securities. These funds have selection risk.
— Passive funds based on equity indices
— Invest in companies whose earnings are expected to grow at an above average rate
—– Scheme follows a value strategy, identify stocks of good quality companies whose real worth has not been realised yet.
— Scheme should follow a contrarian investment strategy.
Features of equity linked savings scheme (ELSS)
—- Are very short term maturity. They invest in debt securities with less than 91 days to maturity.
— Invest in medium-term and long-term securities issued by the government, banks and corporates, benefit of higher coupon, high interest rate risk due to long term orientation
—- Invest in government securities of medium and long-term maturities.
— Invest largely in floating rate debt securities.
—- Seek higher interest income by investing in debt instruments that have lower credit ratings.
—- Seek flexible and dynamic management of interest rate risk and credit risk, moves across the yield curve depending on the changes in the interest rates.
Features of fixed maturity plans:
For a scheme to be defined as equity fund it must have minimum ——- % investment in Indian equities.
—- That can change proportion between debt and equity depending upon market outlook.
—- Invest in debt securities with a derivative instrument or equity shares. Structured portfolio such that ‘amount invested + interest = investor’s principal.
—- Invests in funds of same fund house or various fund houses.
— Take equal and opposite exposure in different markets, earn a return due to difference in price in the two markets
—- Open-ended funds that track a market index and listed on the exchange.
—- An index fund that invests in gold, gold receipts or gold deposit schemes of banks.
—– Invests directly or indirectly in real estate assets or other permissible assets in accordance with the SEBI (Mutual Funds) regulations, 1996.
In case of real estate mutual fund at least —-percent of the portfolio should be held in physical assets.
_____ Indicates how much money can be generated per unit of mutual fund in case the scheme is liquidated.
Each mutual fund scheme must have a stated investment objective. State whether true or false.
Which of the following is an advantage of mutual funds?
The transparency levels in mutual funds are very low. State whether true or false.
Which amongst the following categories of mutual funds have a fixed maturity date?
Net asset value =