Association of Mutual Funds in India (AMFI) 2008 AMFI Mutual Fund Basic Module Model Mock Test - Question Paper

a. Debenture holder
b. Shareholders
c. Creditors
d. No relationship

47. If beta is higher than 1, the fund is:
a. Less volatile than market
b. More volatile than market
c. Equally volatile than market
d. No relation

48. Volatility in a mutual fund portfolio is caused by ………
a. Investment in blue chip stocks
b. Idle cash lying with the fund
c. Investment in high rated bonds
d. None of these

49. Which is a better investment choice while selecting an equity fund?
a. Ex Marks -75%, Beta – 0.9, Gross Dividend Yield 8%
b. Either one or 3
c. Ex Marks – 80%, Beta- 0.9, Gross Dividend Yield – 8%
d. Ex Marks – 90%, Beta- 0.8, Gross Dividend Yield – 9%

50. An investor asks you in what order he should list the subsequent schemes, going from the scheme with the lowest risk to the 1 with the highest risk – 1. Balanced Fund, 2. A Stock Index Fund, 3. A Liquid Fund, 4. An IT Sector Fund.
a. 1,2,3,4
b. 1,3,4,2
c. 3,1,2,4
d. 2,3,1,4

51. As per Jacob’s recommendation low risk fund portfolio is likely to have.
a. 50% invested in Government Securities Funds and 50% invested in Money Market funds
b. An equal split ranging from Government Securities Funds, Growth Funds and Index Funds
c. Equal investments in Aggressive Growth Funds, Value Funds, Sector Funds and Debt Fund
d. A mix of Balanced and Growth

52. For which of the subsequent would you consider “ avg. maturity” as an important factor in selecting the right 1 for the investor?
a. A debt fund
b. A balanced fund
c. A money market or liquid fund
d. Both a and b above

53. Which of the subsequent is recommended by Jacob for a Low Risk portfolio?
a. 50 % Growth and Income fund + 50% Money Market fund
b. 50% Growth funds + 50% index fund
c. 50% Government Securities fund + 50% Money Market fund
d. 50% Sector Funds + 50 % Money Market fund

54. Which of the subsequent is not a specialty fund?
a. Sector fund
b. Mid cap /small cap fund
c. Foreign securities fund
d. Gilt fund

55. The emergence of Private Funds in Indian Mutual Fund industry came in which Phase of Mutual Funds history?
a. Phase two during the period 1987 to 1993
b. Phase three during the period 1993 to 1996
c. Phase four during the period 1996 to 1999
d. Phase five during the period 1999 to 2004

56. Which of the subsequent is incorrect?
a. An equity fund would invest in ordinary shares, preference shares and warrants
b. A bond fund would mainly buy debt instruments
c. An index fund is indexed to inflation index
d. A sector fund invests in the shares of companies in a particular industry

57. Mutual fund pay commission to their agents:
a. As an incentive for having brought in an investor
b. As compensation for his before and after sales service to the investor
c. To off set any direct expenses that they may incur on sale of units
d. All of the above

58. Board of Trustees appoint Custodians for...
a. Making payment to bankers on behalf of the fund
b. Selling units of a mutual fund
c. Safekeeping of physical securities of the mutual fund or participating in any clearing system.
d. None of these

59. By What name is the Phase of year 2004 onwards of mutual fund industry known?
a. Growth and SEBI Regulation
b. Emergence of Large & uniform industry
c. Emergence of Private funds
d. Consolidation & growth

60. Which of the subsequent can be a actual statement?
a. NAV of debt instruments fluctuates more that liquid
b. Gilt securities are less riskier that other debt securities
c. Equity is more risky
d. All of the above

61. Who is responsible for the redressal and handling of investor complaints?
a. Fund Trustees
b. The AMC
c. Registrar
d. SEBI




62. Who is responsible for filing details of the fund’s portfolio with SEBI?
a. Registrar of the fund
b. Fund trustee
c. Custodian
d. The Fund manager

63. For a person to qualify as a sponsor, he must
a. Contribute at lowest 40% of the AMC’s net worth
b. Should be carrying on business in financial services for at lowest five years prior to registration
c. Should have a sound financial track record
d. All of the above
e. None of the above

64. Board of Trustees appoint Custodians for
a. Making payment to bankers on behalf of the fund
b. Selling units of a mutual fund
c. Safe keeping of physical securities of the mutual fund or participating in any clearing system
d. None of the above

65. Who is the primary guardian of unit holders' funds/assets
a. The AMC
b. The Trustees
c. The Registrars
d. The custodians

66. The fundamental attributes can be changed in an open-ended scheme by subsequent methods
a. Informing all unit holders individually and offering them exit without any load
b. Voting of 75% of the unit holders.
c. Paper Advertisement in daily newsprint
d. Both one and 3.

67. Bank owned Mutual Funds are supervised by
a. SEBI
b. RBI
c. Jointly by SEBI & RBI
d. AMFI

68.The role of AMFI in the mutual funds industry is not to
a. Promote the interests of the unit holders
b. Set a Code of Ethics
c. Regulate mutual funds
d. Increase public awareness of mutual funds in the country

69. Which of the subsequent is an example of Merger of 2 AMCs?
a. Birla and Alliance
b. Zurich and HDFC
c. Apple and Birla
d. HB And Taurus.


70. Which of the subsequent is an example of Scheme Take over?
a. Birla and Alliance
b. Zurich and HDFC
c. Apple and Birla
d. HB And Taurus.

71. Which of the subsequent is an example of AMC Take over?
a. Birla and Alliance
b. Apple and Birla
c. HB And Taurus.
d. None of the above.

72. 1 of the subsequent is NOT needed to be disclosed in the offer document. Which one?
a. Details of Sponsor/Trustees
b. Investors rights and services
c. Performance of the other Mutual Funds
d. Description of the scheme and investment objective

73. A Charitable Trust wants to invest in Mutual Funds. What would you do?
a. Accept the application from with the cheque
b. Refuse to accept the application
c. Refer to the Offer document of the scheme to confirm that a charitable trust is allowed to invest
d. Accept the application form, without the cheque, and forward it for final acceptance by the fund / AMC

74. The investor cannot plead ignorance of procedures while investing in a mutual fund because
a. Mutual fund is a risky investment
b. The legal regulations does not permit the investor to sue the trust
c. While applying the investors signs an agreement stating they have learn and understood the terms and conditions
d. An investor is expected to be careful while investing
e. Mutual fund is based upon trust

75. Along with the application, it is mandatory to distribute
a. Offer document
b. Key info memorandum
c. Prospectus
d. None of the above

Earning:   Approval pending.