Portfolio Management Services (PMS) Distributors Free Demo Test 9

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1. Do investments in the same asset class have high negative correlation?

a) Yes, because they are affected by the same macro economic factors

b) No, they are weakly negatively correlated

c) Yes, due to investor's arbitrage

d) No, they display positive correlation

2 / 10

2. The investment goals of investors can be categorised in a Investment Policy Document, for better clarity, on the basis of ________.

a) Time Period and Return

b) Return and Risk

c) Priority and Return

d) Time Period and Priority

3 / 10

3. An Investor has an old house purchased for Rs.5 crores and some Antique Paintings acquired at Rs.25 lakhs and personal loan and credit card outstanding at Rs.15 lakhs. What is the Estimated Net worth?

a) Minimum 5.1 Crores

b) Minimum 5 crores

c) Cannot be Estimated due to lack of market values of assets

d) Minimum 5.25 crores

4 / 10

4. Which of the following decisions are taken more frequently?

a) Psychographic Classification of Investor

b) Tactical Asset Allocation

c) Strategic Asset Allocation

d) Asset Selection

5 / 10

5. Strategic Asset Allocation decisions focus more on _______.

a) Time taken to Enter the Market

b) Time of the Market

c) Timing the Market

d) Time in the Market

6 / 10

6. Rebalancing Norms of Portfolio find a place in __________.

a) SEBI (Portfolio Managers) Regulations, 2020

b) Investment Policy Statement

c) Fund Scheme Document

d) GIPS Guidelines

7 / 10

7. If the cumulative wealth relative for a 5 year period is 1.4562, then what is the Geometric Mean Return (round off to two decimals)?

a) 9.12 percent

b) 7.81 percent

c) 1.09 percent

d) 1.07 percent

8 / 10

8. Which of the following is a significant challenge in the creation of a customised benchmark?

a) Arriving at the weights to the securities

b) Maintenance cost of the benchmark

c) Finding comparable securities

d) Tracking the performance of the benchmark

9 / 10

9. What is the list which the Compliance Officer of a company maintains to approve trades by Designated Persons?

a) Restricted List

b) Concurrent List

c) Diligent List

d) Approved List

10 / 10

10. In determining the Price of a derivative, which of the following is not used ________.

a) Price Volatility of underlying assets

b) Value at Risk of the underlying Asset

c) Price of underlying asset

d) Expiration period of the derivative contract

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Portfolio Management Services (PMS) Distributors Free Demo Test 9

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