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Practice Test (Finance)

Description: AMFI MOCK TEST PAPER PREPARATION AND PRACTICE STUDY MATERIAL
Number of Questions: 25
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Tags: AMFI MOCK TEST PAPER Test AMFI MOCK TEST PAPER AMFI MOCK TEST AMFI MOCK PAPER MOCK TEST AMFI EXAM AMFI TEST Market and Instruments
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Once a financial advisor works out ideal Asset Allocation, it can be used for all his investors

  1. True

  2. False


Correct Option: B

Mutual fund investors should be advised to expect

  1. low post tax returns

  2. dramatic results

  3. better returns than available option

  4. only realistic wealth accumulation goals every other


Correct Option: D

Asset Allocation is

  1. keeping certificates of the physical securities in proper places

  2. allocation of the available money to all the securities available

  3. allocating the right proportion of funds to equity, debt and money market securities

  4. None of the above


Correct Option: C

The liquidity needs of an investor through

  1. Equity Funds

  2. Index Funds

  3. Money Market Funds

  4. Sector Funds are met


Correct Option: C

To satisfy a young investor's need for growth, a greater proportion of investment should be advised in

  1. gilt funds

  2. income Funds

  3. equity Growth funds

  4. liquid funds


Correct Option: C

A retired person generally needs a greater proportion of

  1. debt funds

  2. equity funds

  3. money market funds

  4. All of the above


Correct Option: A

The transition phase of an investor's wealth cycle is when the

  1. financial goals have been already met

  2. the investor has retired

  3. financial goals are approaching

  4. investor suddenly gets a windfall


Correct Option: C

A high proportion of investment in income funds is required by

  1. accumulating investors

  2. affluent investors

  3. investors in the inter-generational transfer phase

  4. investors in the distribution phase


Correct Option: D

Retired investors should

  1. not draw down on their capital

  2. not invest in securities, which bear risk of capital erosion

  3. continue holding some portion of their holding in equity growth funds

  4. never invest in equity


Correct Option: B

A very high proportion of investment in all types of equity funds is advisable for investors

  1. in distribution phase

  2. in accumulation phase

  3. in transition phase

  4. who are wealthy affluent individuals?


Correct Option: B

For older investors who want to transfer their wealth

  1. no financial planning is required

  2. the right investment strategy depends upon who the beneficiaries are

  3. the right investment strategy depends upon the state of the stock market

  4. all the funds can be invested in aggressive equity funds


Correct Option: B

Among the following, which is more important for an investor?

  1. Size of the fund

  2. Funds suitability for an investor

  3. Past performance of the fund

  4. Fund Manager


Correct Option: B

Investors who acquire sudden wealth

  1. can speculate with all the acquire, money in the stock markets

  2. should not use any of the new wealth to invest in equity

  3. should take the effect of taxes into account

  4. need not pay any taxes on the newly acquired wealth as it is not a part of their regular income


Correct Option: C

Structural characterization of an equity fund include

  1. costs of investing

  2. the specific securities in which the fund has invested

  3. the number of employees of the AMC

  4. All of the above


Correct Option: B

An equity fund can be said to be concentrated when

  1. it invests in only in two or three stocks

  2. it invests in many companies of the same sector

  3. top ten holdings account for more than 50% of net assets invested

  4. top ten holdings account for more than 25% of net assets invested


Correct Option: C

The size of the market capitalization of a fund's equity holdings is inversely proportional to the

  1. returns that can be expected from the fund

  2. level of risk assumed by the fund

  3. state of the stock market

  4. All of the above


Correct Option: B

Ex-Marks of an equity fund measures its

  1. performance

  2. risk

  3. both the above

  4. None of the above


Correct Option: A

A steady holding of investments in an equity fund's portfolio indicates

  1. long-term orientation

  2. lower transaction costs

  3. both the above

  4. None of the above


Correct Option: C

Debt schemes are popular because

  1. the Indian stock market is always going down

  2. the returns are more predictable

  3. most investors are always in debt

  4. All of the above


Correct Option: B

Yield-to-maturity of a debt fund's portfolio gives an indication of

  1. current income

  2. total return

  3. liquidity

  4. All of the above


Correct Option: B

Beta of an equity fund measures its

  1. performance

  2. risk

  3. both the above

  4. None of the above


Correct Option: B

The best equity fund, relative to others, would have

  1. higher Ex Marks, lower Beta and higher gross Dividend Yield

  2. higher Ex Marks, higher Beta and higher gross dividend yield

  3. lower Ex Marks, lower Beta and lower gross dividend yield

  4. lower Ex Marks, higher Beta and higher gross dividend yield


Correct Option: A

Compared to equity funds, income margins for debt funds are

  1. narrow

  2. higher

  3. the same

  4. almost nil


Correct Option: A

As per current regulations, dividend distribution tax should be taken into account when computing net returns from

  1. equity funds

  2. debt funds

  3. both the above

  4. None of the above


Correct Option: B

The differentiating factor among debt funds of comparable maturity and quality is

  1. gross yields

  2. costs

  3. fund age

  4. tenure of the fund manager


Correct Option: A
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