NISM Series X-A Investment Adviser (Level 1) Cert. Mock Test - 1

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NISM Series X-A Investment Adviser (Level 1) Cert. Mock Test – 1

1 / 50

A debenture holder has the right to __________.

a) Dividend

b) Vote

c) Interest

d) None of the above

2 / 50

Diversification across companies can reduce non-systematic risk in an equity portfolio.

a) True

b) False

3 / 50

A person aged 26 years, with a long-term goal of maintaining the current lifestyle post-retirement, would likely have the largest asset allocation of funds in ____________.

a) Bank saving account

b) Traditional insurance schemes

c) Recurring account

d) Equity and equity oriented mutual fund schemes

4 / 50

Who qualifies as a Qualified Institutional Buyer?

a) Scheduled commercial bank

b) SEBI registered Venture capital fund

c) SEBI registered mutual fund

d) All of the above

5 / 50

The significance of T + 2 rolling settlement is _______.

a) Trades are netted after two days and delivery will take place on the second day after such netting

b) Settlement of trades on the second working day from the date of trade

c) Trades done on a particular day are settled on the date of trade

d) Same as account period settlement

6 / 50

The concept of time value of money suggests that

a) Due to inflation, money has a lower purchasing value in future

b) Current cash inflows can be re-invested to earn a return that increases future value

c) Money should be invested immediately without wasting time

d) The timing of investment influences final returns

7 / 50

Who among the following individuals is required to adhere to the registration requirements under SEBI (Investment Advisers) Regulations, 2013?

a) An IFA who charges advisory fees to investors

b) A Chartered Accountant practicing his profession

c) A distributor of a mutual fund who only receives commission from the AMC.

d) Fund Manager of an AMC

8 / 50

________ typically results in an increase in the Earnings Per Share (EPS) of a company.

a) Split

b) Bonus Issue

c) Share Buyback

d) Dividend

9 / 50

_________ has created a centralized web-based system for submitting and monitoring investor complaints, known as SCORES.

a) RBI

b) PFRDA

c) SEBI

d) IRDA

10 / 50

The fundamental market outlook of an investor who holds a long put is __________.

a) Neutral

b) No view

c) Bullish

d) Bearish

11 / 50

The _____ of a share is used to figure out how much dividend should be paid for that share.

a) Market Value

b) Face value

c) Book value

d) All the above

12 / 50

Which of the following is not considered a part of small savings schemes in India?

a) Public Provident Fund Scheme

b) Kisan Vikas Patra

c) Sovereign Gold Bond Scheme

d) Sukanya Samriddhi Account Scheme

13 / 50

Which ratio informs investors about the company’s profit earned for each equity share they own?

a) Price to Earnings Ratio

b) Price to Book Value

c) Earnings per Share

d) Book Value per Share

14 / 50

Is it true or false that the top-down approach starts with macro factors and then identifies sectors and stocks based on the recognition of macro trends?

a) True

b) False

15 / 50

Which of the following does not fall under the fiduciary responsibilities of a financial planner towards their client?

a) Serve the client's best interest

b) Act in utmost good faith

c) Disclose all material facts

d) Get the best returns on client's investments

16 / 50

Is it true or false that the Department of Economic Affairs manages all affairs related to the disinvestment of the Government of India’s shareholding in Central Public Sector Enterprises?

a) True

b) False

17 / 50

Expand the acronym IGMS.

a) Insurance General Management System

b) Integrated Grievance Management System

c) Intelligent Grievance Management System

d) Indian General Management System

18 / 50

Who oversees the issuance of government securities and manages public debt?

a) PFRDA

b) SEBI

c) RBI

d) IRDA

19 / 50

Public limited companies must make public offers only in dematerialized form if the offer exceeds ____ crore.

a) Rs. 15 crore

b) Rs. 25 crore

c) Rs. 50 crore

d) Rs. 10 crore

20 / 50

Credit Risk funds invest in corporate debt instruments rated ______ and lower.

a) AA

b) AAA-

c) A

d) BBB

21 / 50

A retail investor in a public issue is an investor ______.

a) Who is not an institutional investor

b) Who does not have a demat account

c) Who applies for atleast 100 shares

d) Who invests not more than Rs. two lakhs

22 / 50

A U.S. citizen invested $1,000 in an Indian bank fixed deposit at a 10% interest rate for one year when the exchange rate was Rs. 45 for US$1. After a year, the rupee depreciated, and the exchange rate became Rs. 50 per USD. Did the U.S. citizen make a profit or loss?

a) Profit

b) No change

c) Loss

d) None of the above

23 / 50

Which mutual fund schemes must be officially listed on the stock exchange according to SEBI regulations?

a) All Equity scheme

b) Closed Ended schemes

c) All Debt schemes

d) Open Ended schemes

24 / 50

What among the following represents a financial goal?

a) A sizable sum needed to buy a new car in two years’ time

b) Rs.6 lakhs required for sister’s wedding

c) Rs.5 lakhs needed after two years to pay child’s tuition fees

d) Rs. 10 lakhs needed for purchasing a flat

25 / 50

If the US Dollar-Rupee exchange rate changes from 43.00 to 43.30, the US Dollar has __________ and the Rupee has ___________.

a) Appreciated, Strengthened

b) Appreciated, Depreciated

c) Depreciated, Weakened

d) Depreciated, Appreciated

26 / 50

Assuming a constant growth rate in a stock’s dividend, what would be the intrinsic value of the stock given D1 = Rs. 3, k = 9%, and g = 6%?

a) Rs. 95

b) Rs. 105

c) Rs. 110

d) Rs. 100

27 / 50

Which of the following is/are types of accounts in Portfolio Management Services (PMS)?

a) Non-discretionary portfolio management

b) Advisory services

c) Discretionary portfolio management

d) All of these

28 / 50

What does a fundamental analyst study among the following?

a) Companys financials

b) Competitive position in industry

c) Companys management

d) All the above

29 / 50

A company with an equity capital of Rs.50 crores generates a gross profit of Rs.100 crores and a net profit after tax of Rs.50 crores. If the market price of its equity share is Rs.100, what will be its P/E ratio.

a) 5

b) 50

c) 20

d) 10

30 / 50

SEBI does not deal with any complaints which fall under the purview of the other regulatory bodies i.e. IRDA , PFRDA etc. State whether True or False.

a) True

b) False

31 / 50

Harish’s dad gave him something called a “general power of attorney.” What does that mean?

a) He has given Harish the immediate right to make decisions in all matters and take action on his behalf

b) He has disinherited Harish, but Harish has the right to decide who will inherit his father's estate

c) He has given Harish the right to make decision to deal with the renting out of an apartment only

d) He has given Harish the right to appoint himself as the sole beneficiary of estate

32 / 50

In the span of 18 months, the growth option of a plan increased from Rs 10 to Rs 16. What is the Compound Annual Growth Rate (CAGR)?

a) 40%

b) 60%

c) [(16/10)^(12/18)]-1

d) [(16/10)^(18/12)]-1

33 / 50

A technical analyst studies _____________.

a) Share price trends

b) Share trading volumes

c) Both the above

d) Human behaviour

34 / 50

An investor buys shares in a sugar-producing company. The returns from the investment do not face

a) Systematic Risk

b) Interest rate risk

c) Credit risk

d) Business risk

35 / 50

What does a portfolio’s beta measure?

a) Credit risk

b) Volatility of investment returns in comparison to a benchmark

c) Rolling returns

d) Returns in comparison to a benchmark

36 / 50

Sensex falls by 10% at 2:45 PM. The market will be halted for ____________.

a) Two hours

b) One hour

c) No Halt

d) Half an hour

37 / 50

Mr. Manish initially invested 50% in equity and 50% in debt. Later, he adjusts his asset allocation to 70% equity and 30% debt based on his market view. This is known as:

a) Strategic Asset Allocation

b) Index Asset Allocation

c) Tactical Asset Allocation

d) Optimal Asset Allocation

38 / 50

The Department of Economic Affairs handles all matters related to the disinvestment of the Government of India’s shareholding in Central Public Sector Enterprises. Is this statement True or False?

a) True

b) False

39 / 50

An investor bought mutual fund units at an NAV of Rs. 11. After 450 days, he sold them for Rs. 13.50. What is the compounded rate of return?

a) 22.70%

b) 18.42%

c) 18.07%

d) 23.50%

40 / 50

_______ is the market where issuers raise capital by issuing securities to investors for the first time.

a) Primary Market

b) Secondary Market

c) Money Market

d) Forward Market

41 / 50

Taking advantage of unusual price differences in the market to make money is called “_________.”

a) Arbitrage

b) Shorting an asset

c) Speculation

d) Hedging

42 / 50

An investor from India put Rs. 50 lakhs into a US equity fund when the exchange rate was 70 Rupees per US dollar. The fund gained 15%, and during this time, the Rupee strengthened to 65 per US dollar. What is the total return the investor has earned?

a) 7.15%

b) 6.79%

c) -7.15%

d) 15%

43 / 50

What is the purpose of the Depositories Act of 1996?

a) Providing for maintenance of ownership records in a book entry form.

b) Making securities of public limited companies freely transferable

c) Dematerialising the securities in the depository mode;

d) All of the above

44 / 50

Selling a call option involves

a) Paying the Premium and Obligates the seller of the option to buy a security on a specified date in future at the specified price

b) Receiving the premium and Gives the Seller of the option the right to buy a security on a specified date in future at the specified price

c) Receiving the Premium and Obligates the seller of the option to sell a security on a specified date in future at the specified price

d) Paying the Premium and Gives the buyer of the option the right to sell a security on a specified date in future at the specified price

45 / 50

What factors are usually assessed in fundamental analysis?
I. Interest rates, gross domestic product, inflation, unemployment, and inventories
II. Market activity and overall market trends
III. Past records of assets, earnings, sales, products, management, and markets
IV. Balance sheets and income statements of companies

a) I, II, and III only

b) I, II, and IV only

c) I, III, and IV only

46 / 50

In ASBA, the money is reserved or blocked in.

a) Trading members account

b) Issuing Company Account

c) Investors Own Account

d) All of the above

47 / 50

The Standard deviation for stocks A & B are 0.2041 and 0.2944 respectively. Correlation between the two stocks is 0.8488. Calculate the covariance between the stocks?

a) 0.041

b) 0.051

c) 0.4101

d) 0.5101

48 / 50

How do promoters typically reduce or sell their ownership in publicly traded companies?

a) Offer for sale of shares

b) Preferential Issue

49 / 50

Under ASBA facility, investors apply in __________ by using their bank account.

a) Public Issues

b) Rights Issues

c) Both the above

50 / 50

Further Public Offer (FPO) can be made only through book building issues through the stock exchange route. State whether True or False?

a) True

b) False

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NISM Series X-A Investment Adviser (Level 1) Cert. Mock Test - 1

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