Investment Adviser (Level 1) Free Demo Test 5

1 / 11

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

a) Arbitrage

b) Shorting an asset

c) Speculation

d) Hedging

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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%

3 / 11

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

4 / 11

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

5 / 11

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

6 / 11

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

7 / 11

7. 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

8 / 11

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

a) Offer for sale of shares

b) Preferential Issue

9 / 11

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

a) Public Issues

b) Rights Issues

c) Both the above

10 / 11

10. 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

11 / 11

11.

A Merchant Banker applicant should have a minimum of two persons in their employment who are experienced to conduct the business of a Merchant Banker.

a) 1

b) 4

c) 2

d) 3

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Investment Adviser (Level 1) Free Demo Test 5

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