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1. All advertisements released by the Mutual Fund are required to be

filed with SEBI within
10 days from the date of issue
15 days from the date of issue
07 days from the date of issue
None of the above
2 Marks
2. Equity Warrants :
Offer right to purchase equity
Are in the nature of stock options
Are usually available at a fixed price
None of the above
All of the above
1 Marks
3. As per tax law Capital Gains is equal to
Sale consideration
Sale consideration - (Cost of Acquisition+ Cost of
Improvement+Cost of Transfer
Cost of Acquisition
Cost of Improvement
Cost of Transfer
None of the above
2 Marks
4. Which of the following Portfolios would you recommend to a Young

Unmarried Professional ?
10% in aggressive equity fund, 60% in high yield bond
funds, 30% in money market funds
80% in aggressive equity funds, 20% money market funds
either 1 or 2
None of these
2 Marks
5. The following can act as agent/ distributor for a Mutual Fund
Employees of the Asset Management Company
Directors of the Trustee Company
Directors of the Asset Management Company
All of the above
None of the Above
2 Marks
6. Choice of stocks to be included in the Portfolio should be based on :
Risk Potential
Return Potential
Earnings growth
Objective of the Scheme
2 Marks
7. An investor purchases a flat on Jan 1 1995 for Rs. 10 Lakhs, which he
sells on Feb 15 1999 for a net consideration of Rs 14 Lakhs. He
invests Rs. 40,000 in a mutual fund scheme under section 54EB.Is the
investor eligible for tax exemption under section 54
Yes
No

Insufficient Information
None of the above
2 Marks
8. Exchange rate relates to
foreign exchange
barter
unemployment
Interest rate
1 Marks
9. In UK Close-ended Mutual Funds are set up in the form of
___________
Partnership
Sole-Proprietorship
Corporate entity
Trusts
Any of the above
None of the above
1 Marks
10. Most Mutual funds try to reduce their exposure to the risks of
individual securities through
Diversification
Market Timing
Rupee-cost averaging
None of the above
1 Marks
11. Which of the following issuer classes are permitted to issue

Financial institutions
Corporates
NBFCs
Chit funds
None of these
1 Marks
12. A security having term to maturity less than 182 days to be valued on
:
Amortised - straight line basis
Amortised - purchase yield
Amortised - last traded yield
Last traded price
2 Marks
13. An open-ended Equity Scheme has average weekly net assets of Rs.
550 crore. According to SEBI Regulations it can charge total
expenses of ------Rs. 11.750 crore
Rs. 10.875 crore
Rs. 12.000 crore
Rs. 12.250 crore
None of the above
2 Marks
14. Convertible Debentures are :
Equity Securities
Debt Securities

Hybrid Securities
None of the above
1 Marks
15. Which of the following Portfolios would you recommend to a Young
Couple with Two Incomes and two children ?
50% in aggressive equity fund, 25% in high Yield bond
funds and growth and income funds, 25% in conservative
money market funds
50% Moderately Aggressive Equity fund, 20% Aggressive
equity fund, 15% High yield bond funds, 15% municipal bond
funds
10% in Money market, 30% in Aggressive Equity fund,
25% in high yield bond funds, and long term growth funds,
35% in municipal bond funds
either 1 or 2
None of these
2 Marks
16. A Scheme can make investment in
In listed securities of group companies not exceeding 10%
of the net assets
Unlisted / privately placed debentures of group companies
of the Sponsor
In listed securities of group companies not exceeding 25%
of the net assets
In listed and unlisted securities of group companies
1 Marks
17. Fundamental Analysis involves:
Analysis of the Balance Sheet of the Company
Analysis of the Industry that the Company operates in

Analysis of the quality of management of the Company

All of the above
2 Marks
18. To compute returns in a Liquid Fund, one can use
Simple annualised returns for period less than 30 days
Simple annualised returns for period more than 30 days
Compounded annualised returns for period greater than I
year
All of the above
Only (1) and (3)
Only (2) & (3)
2 Marks
19. When investing for the first time, the investor would be well advised
to refer to the:
Detailed Offer Document
The Key Information Memorandum
Either of the above
None of the above
2 Marks
20. What does disclosure norms in case of Borrowing policy of the
Mutual Fund Consist of ?
the intent and purpose of borrowing
circumstances under which borrowings will be resorted to
regulatory limits on borrowings
expected sources of borrowing and possible collateral used
if any ,

All of the above

None of the above
1 Marks
21. Income earned by a Mutual fund registered with SEBI is exempt
from Income-Tax as per section
10(23D)
10(33)
Total income is taxable @ 33.2%
88
94
None of the above
2 Marks
22. What is the minimum networth prescribed for an AMC in India?
Rs.5 Crores
Rs.25 Crores
Rs.10 Crores
Rs.50 Crores
Rs.40 Crores
None of the above
1 Marks
23. What is the maximum duration for which a Mutual Fund can borrow
money ?
One Year
Two Years

One Month
Six Month
None of the Above
1 Marks
24. A debt security will be categorized as thinly traded security if trading
value during 30 days prior to valuation date is less than :
10 crores
15 crores
20 crores
5 crores
2 Marks
25. An open-ended Debt Fund with average weekly net assets of Rs. 950
crore can charge investment management and advisory fees of -------according to SEBI Regulations
Rs. 9 crore
Rs. 9.5 crore
Rs. 9.75 crore
Rs. 10 crore
2 Marks
26. An Index Fund cannot invest in the following
Nifty
BSE 100
BSE 30
Commodities Exchange
1 Marks
27. The Trustee shall obtain consent of the Unotholders

whenever required by SEBI in interest of Unitholders

When requisition is made by 3 / 4 th of Unitholders of the
Scheme
When the Trustee decides to wind up the Scheme (s)
1 and 2
When the trustee decides to premeturely redeem units
1, 2 3 and 5
2 Marks
28. The Trustee is obliged to convene a meeting on the requisition of
what percentage of the Unitholders of the Scheme?
0.25
0.5
0.75
None of the above
2 Marks
29. Technical Analysis tries to predict future movement of stock price by
analyzing :
The financial workings of a Company
The stock price movements of a Company
Both of the above
None of the above
2 Marks
30. Mutual Fund charges load to investor at the time of his/her entry/exit
in order to cover
Distribution/Sales/Marketing Exp.
Trusteeship Fee

Asset Management Fee

Fee paid to SEBI
2 Marks
31. For availing the Capital Gain Tax exemption under section 54EB the
amount of gain has to invested for
2 yrs
3 yrs
As per Finance Act 2000-01the exemption has been
abolished
5 yrs
7 yrs
None of the above
2 Marks
32. Under normal circumstances [ Except in case of Death etc. ] facility
of transfer of Units , if required is available In case of open-ended schemes
In case of Close-ended schemes
Both type of schemes
None of the above schemes
2 Marks
33. The Offer Documents of the Schemes of the Mutual Fund have to be
updated within
One year from the date of issue
Two years from the date of issue.
Six months from the date of issue
None of the above

2 Marks
34. India's Central Bank is called
Central Bank of India
Bank of India
Indian Bank
Reserve Bank of India
1 Marks
35. For open-ended schemes, the policy with respect to illiquid assets
must be disclosed if
the illiquid assets are likely to be more than 15% of the net
assets
the illiquid assets are likely to be more than 5% of the net
assets
the illiquid assets are likely to be more than 10% of the net
assets
the illiquid assets are likely to be more than 20% of the net
assets
2 Marks
36. No change in Fundamental Attribute of any scheme or theTrust or
fees and expenses payable or any other change which would modify
the sheme and affect the interest of Unitholders can be carried out
unless
a written communication regarding the change is sent to
each Unitholder
An advertisement is given in one English Newspaper
having nationwide circulation
In a newspaper published in the language of the region
where the Head Office of the Mutual Fund is located.
Unitholders are given an option to exit at the prevailing
NAV without any Exit Load

2,3 and 4
1,2,3 and 4
2 Marks
37. Incase of borrowings by Mutual Fund , The Mutual Fund shall not
borrow more than
20 % of the net asset value of the scheme
30 % of the net asset value of the scheme
50 % of the net asset value of the scheme
10 % of the net asset value of the scheme
None of the Above
1 Marks
38. Which Statement is true about Systematic Withdrawal Plan [ SWP ]
being different from MIP?
SWP allows investors to get back the principal amounts
invested while MIP only pays the income generated on a
regular basis
In SWP the requested amount to be withdrawn remains the
same over the requested period whereas in MIP the payout may
vary subject to availability of income
In SWP, amount withdrawn is treated as redemption of
units at applicable NAV , Whereas in MIP the units remain the
same
All of the above
Only 1 & 3
2 Marks
39. Who among the following can nominate?
Unitholder acting as a Trust
Unitholder holding units as holder of an office

Both the above

None of the above
2 Marks
40. Dividend Yield of a Company is the ratio of :
Dividend per share upon Face Value per share
Dividend per share upon Book Value per share
Dividend per share upon Market Price per share
Dividend per share upon replacement cost per share
2 Marks
41. Distribution tax on the income distributedby debt fund is paid as per
the section
88
196
94
194
115 R
None of the above
2 Marks
42. Jacob's Program for Developing a model Portfolio includes
Working with investors to develop Long Term Goals
Determining the asset allocation of the investment portfolio
Avoiding ad-hoc Investment advice or decisions
All the Above
Only 1&3

Only 1&2
2 Marks
43. In India , Mutual Funds are not allowed to borrow except
to meet the initial expenses of launching schemes
to meet the marketing and selling expenses .
to meet temporary liquidity needs for the purpose of
repurchase , redemption of units or payment of interest or
dividend to the unit holder.
to meet registrar service charges for transfer of units sold or
redeemed.
None of the Above
1 Marks
44. When trading in an equity / equity related security in a month is less
than ________________, it shall be considered as thinly traded
Rs. 5 lacs and 50000 shares
Rs. 5 lacs
50000 shares
None of the above
2 Marks
45. A Sectoral Fund investing in debt could invest in all except for the
following
Corporate Debentures
PSU Bonds
Government Securities
Shares in Pharmaceutical Companies
1 Marks
46. In USA Mutual Funds are set up as____________

Public Ltd Cos.

Trusts
Partnership Firms
None of the above
Any of the above
1 Marks
47. Distribution Tax of 10.2% is applicable as per the Finance bill 2001
w.e.f
36251
36982
36617
37043
All of the above
None of the above
2 Marks
48. Filing fees for Offer Document with SEBI is
Rs. 25,000/- per Scheme
Rs. 25,000/- per Offer Document
Rs.10,000/- per Scheme
Rs.10,000/- per Offer Document
2 Marks
49. Everything else being the same, the relationship between coupon and
duration is
inverse

direct
the two are not related
not enough information
1 Marks
50. Which of the following constituent doesn't form part of the Indian
Mutual Fund structure?
Asset Management Company
Custodian
Underwriter
Banker
Any of the above
None of the above
1 Marks
51. Which of the following Portfolios would you recommend to a
Recently retired Couple?
35% in Conservative Equity funds, 25% in moderately
aggressive equity, 40% in money market funds
30% in short term municipal funds, 35% long term
municipal funds, 25% moderately aggressive equity, 10% in
emerging growth equity
50% in aggressive equity fund, 25% in high Yield bond
funds and growth and income funds, 25% in conservative
money market funds
either 2 or 3
None of these
2 Marks
52. Which is a better investment option whilst selecting an equity fund?
Ex Marks- 75%, Beta- 0.9, Gross Dividend Yield- 8%

Ex Marks- 80%, Beta- 0.9, Gross Dividend Yield- 8%

Ex Marks- 90%, Beta- 0.8, Gross Dividend Yield- 9%
Either 1 or 3
2 Marks
53. Investors which invest in stocks that are undervalued are:
Value investors
Growth investors
Cyclical investors
Index investors
1 Marks
54. Which of the following Portfolios would you recommend to a Older
Couple with Single Income ?
10% in Money market, 30% in Aggressive Equity fund,
25% in high yield bond funds, and long term growth funds,
35% in municipal bond funds
10% in aggressive equity fund, 60% in high yield bond
funds, 30% in money market funds
30% in short term municipal funds, 35% long term
municipal funds, 25% moderately aggressive equity, 10% in
emerging growth equity
either 1 or 2
None of these
2 Marks
55. Which is untrue regarding Loans against Mutual Fund units?
SEBI regulation permits the Mutual Funds to give loans
against their Units
SEBI regulation prohibits Mutual Funds themselves from
giving Loan against Units

Several banks lend to investors against Mutual Fund units

held by them
Banks are usually inclined to sanction higher amount
against Unit holding in Liquid schemes
2 Marks
56. Equity Warrants differ from Stock Options in that :
They are compulsorily converted into equity while options
are not
They are issued by the company while stock options are not
They do not have a predetermined conversion price like
options.
None of the above
2 Marks
57. An NRI holds Units in a Mutual Fund. What should he do with his
holding if he takes up a foreign citizenship?
He redeems
He continues
He transfers the units to his mother, who resides in India
None of the above
2 Marks
58. The AMC must have a networth of atleast :
1 crore
5 crores
10 crores
100 crores
2 Marks
59. In case of a dispute, against whom can the Unitholders initiate legal

proceedings ?
Trust
Trustees
AMC
None of the above
2 Marks
60. Which of these instruments are eligible for Repo transactions
Commercial Paper
Certificates of Deposit
Corporate Debentures
Government Securities
1 Marks