NISM 5A
NISM 5A Investment Knowledge Quiz
Test your knowledge of investment principles and practices with our NISM 5A quiz! This quiz is designed to assess your understanding of mutual funds, risk management, and regulatory frameworks.
Key Features:
- Multiple choice questions
- Immediate feedback on your answers
- Ideal for both beginners and experienced investors
The nomination made in a folio applies to all the investments held under the folio.
True
False
The nominee can be an individual, including minors and NRIs, central and state governments and local authorities.
True
False
Redemption requests for units held in demat mode have to be submitted to the depository or through the stock exchange platform.
True
False
Investors can register up to ten bank accounts with a mutual fund for individual investors and 5 for non-individuals.
True
False
The investor also has the option to convert the demat units into physical form. This process is called re-materialisation.
True
False
Variance measures the fluctuation in periodic returns of a scheme, as compared to its own average return.
True
False
Standard Deviation is equal to the square root of variance.
True
False
Non -systematic risk is measured by its Beta.
True
False
Government securities do not have a credit risk.
True
False
Better the credit rating of an issuer, higer is the spread
True
False
To ensure fair treatment to all investors in case of a credit event and to deal with the liquidity risk, in December 2018, SEBI permitted creation of segregated portfolio of debt and money market instruments by mutual funds schemes
True
False
Creation of segregated portfolio was made optional and at the discretion of the AMC.
True
False
Segregated portfolio shall be effective from the day of credit event.
True
False
AMC will charge investment and advisory fees on the segregated portfolio
True
False
NAV of both segregated and main portfolio shall be disclosed from the day of the credit event.
True
False
Choice of benchmark is simplest for an index fund.
True
False
The benchmark for a scheme is decided by the AMC in consultation with the trustees.
True
False
AMCs can change the benchmark in consultation with the trustees
True
False
Liquid schemes invest in securities of up to 91 days’ maturity. Therefore, a short-term money market benchmark such as NSE’s MIBOR or CRISIL Liquid Fund Index is suitable.
True
False
Gold price would be the benchmark Gold ETF
True
False
Which amongst the following is a measure of risk-adjusted returns of mutual fund scheme?
Standard deviation
Beta
Variance
Sharpe ratio
The fund factsheets are an official source of information of the fund’s objective, performance, portfolio and basic investment requirements issued by the fund house each month.
True
False
Tracking error is a measure of the consistency of the out-performance of the fund manager relative to the benchmark.
True
False
Alpha - The difference between a scheme’s actual return and its optimal return is its Alpha—a measure of the fund manager’s performance.
True
False
Higher the Treynor Ratio, better the scheme is considered to be
True
False
Capital gains are classified into two categories: short term capital gains and long-term capital gains.
True
False
Equity mutual funds were exempt from long term capital gains tax earlier,now taxable
True
False
Dividend income from mutual funds used to be tax-free in the hands of the investor
True
False
STT is applicable on purchase of units of an equity scheme.
True
False
GST on all the fees other than investment and advisory fees shall be charged to the scheme within the maximum limit of TER.
True
False
The commission payable to the distributors of mutual funds may be subject to GST
True
False
Redemption from which of the following mutual fund schemes would attract Securities Transaction Tax (STT) for an investor?
Multi-cap mutual fund
Government Securities Fund
Liquid Fund
Overnight Fund
In the non-equity-oriented funds, the rate of long-term capital gains tax is 20 percent with indexation
True
False
AMC prepares the Scheme Information Document for the NFO.
True
False
The Registrars and Transfer Agents (RTAs) maintain investor records.
True
False
The auditor appointed to audit the mutual fund scheme accounts needs to be different from the auditor of the AMC.
True
False
Scheme auditor is appointed by the Trustees, the AMC auditor is appointed by the AMC.
True
False
The appointment of RTA is done by the AMC.
True
False
It is not compulsory to appoint an RTA. The AMC can choose to handle this activity in-house
True
False
The objectives of AMFI are: To define and maintain high professional and ethical standards in all areas of operation of the mutual fund industry.
True
False
A major role of AMFI involves the registration of mutual fund distributors, by allotting them AMFI Registration Number (ARM), which is mandatory for becoming a mutual fund distributor.
True
False
Reserve Bank of India (RBI) that regulates the banking system
True
False
Pension Fund Regulatory and Development Authority of India (PFRDA) that regulates the pension market.
True
False
SEBI issued the mutual fund regulations in 1997 in the form of SEBI (Mutual Funds) Regulations, 1997.
True
False
The Mutual Fund will buy and sell securities on delivery basis.
True
False
In standard warning, both the visual and the voice-over reiteration containing 18 words running for at least 8 seconds may be considered as clear and understandable.
True
False
Advertisement issued by mutual funds shall be in terms of Sixth Schedule of SEBI (Mutual Fund) Regulations, 1996
True
False
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.
True
False
AMCs shall ensure that a true and fair view of the performance of the fund manager is communicated by providing additional disclosures if required.
True
False
What minimum percentage of the mutual fund scheme corpus must be invested in equity and related instruments in the case of Equity Linked Savings Schemes (ELSS)?
65 percent
70 percent
80 percent
100 percent
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