Practice Questions for NISM VA on Risk, Return & Performance of Funds
Practice Questions for NISM Series VA Exam on Risk, Return and Performance of Funds. The NISM Series VA Exam seeks to create a common minimum knowledge benchmark for all persons involved in selling and distributing mutual funds. Claim your NISM VA Certification. Following are some questions / MCQ for NISM V-A Exam with Answers and explanation on Risk, Return and Performance of Funds. Start practicing questions and pass your NISM exam successfully.
Practice Questions for NISM VA Exam on Risk, Return and Performance of Funds
Q 1. In Equity longer the holding period, the lower is the volatility in the return. State whether True or False.
[a] True
[b] False
Show Answer
Correct Answer: [a] True
Q 2. A person invested in scheme A when the scheme’s NAV was Rs. 100 per unit. The investor redeemed the investment at the NAV of Rs. 130 per unit. Calculate the simple return.
[a] 25%
[b] 30%
[c] 33%
[d] 40%
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Correct Answer: 30%,
Notes: Simple Return = (Later Value – Initial Value)*100/Initial Value
Q 3. A portfolio comprising of debt or money market instrument affected by a credit event, that has been segregated in a mutual fund scheme is known as:
[a] Main portfolio
[b] Separate portfolio
[c] Segregated portfolio
[d] None of the above
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Correct Answer: [c] Segregated portfolio
Read Also:- Questions for MFD Exam on Legal Structure of Mutual Funds in India
Q 4. Which of the following measure the fluctuation in periodic return of a scheme w.r.t. to fluctuation in periodic return of a well diversified stock index (representing the market)?
[a] Alpha
[b] Beta
[c] EPS
[d] CAGR
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Correct Answer: [b] Beta
Q 5. The Beta of a diversified stock index is:
[a] 0
[b] 1
[c] 10
[d] 100
Show Answer
Correct Answer: [b] 1
Notes: Beta of a diversified stock index is always 1.
Q 6. Which of the following measures the fluctuation in periodic returns of a scheme, as compared to its own average return?
[a] Beta
[b] Standard Deviation
[c] Alpha
[d] Variance
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Correct Answer: [b] Standard Deviation
Q 7. Government securities can be considered to be completely risk-free from defaults. State whether True or False.
[a] True
[b] False
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Correct Answer: [a] True
Read Also:- NISM Mutual Fund Distributor Mock Test on Scheme Related Information
Q 8. Which of the following type of analysis track the price and volume data related to trading in the security?
[a] Fundamental analysis
[b] Situation analysis
[c] Quantitative analysis
[d] Technical analysis
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Correct Answer: [d] Technical analysis
Q 9. Unsystematic risk can NOT be reduced through diversification. State whether True or False.
[a] True
[b] False
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Correct Answer: [b] False
Q 10. Which of the following is a measure of fluctuation in periodic return in an equity mutual fund scheme?
[a] Variance
[b] Jensen’s Alpha
[c] Sharpe ratio
[d] Duration
Show Answer
Correct Answer: [a] Variance
Q 11. When price of a equity share goes up, the value of it’s future contract will-
[a] increase
[b] decrease
[c] remain same
[d] None of the above
Show Answer
Correct Answer: [a] increase
Q 12. Value stocks are those stock which –
[a] are currently under valued.
[b] have high growth momentum.
[c] pay high dividend.
[d] are currently over valued.
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Correct Answer: [a] are currently under valued.
Read Also: Questions for MFD Exam on Legal Structure of Mutual Funds in India
Q 13. When interest rates rise, bond price
[a] falls
[b] also rise
[c] dose not affect
[d] either rises or falls
Show Answer
Correct Answer: [a] falls
Q 14. On dividing “Market Price per share” by Earning per Share (EPS), you will get –
[a] Book Value per Share
[b] Price to Book Value
[c] Price to Earnings ratio
[d] Price Earnings to Growth ratio
Show Answer
Correct Answer: [c] Price to Earnings ratio
Q 15. Name the investing style for investing in high growth stocks.
[a] Value investing
[b] Risk free investing
[c] Assured investing
[d] Growth investing
Show Answer
Correct Answer: [d] Growth investing
Notes: Growth investment style entails investing in high growth stock i.e. stock of companies that are likely to grow much faster than the market.
Read Also:- NISM Series VA Mock Test – Mutual Fund Distributors Mock Test
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