NISM Series V-A – Interactive Practice (Part 4: Questions 151–200)
Click an option to see instant inline feedback. This file contains Q151–Q200.
151. What is the primary objective of an ELSS fund?
a) High liquidity
b) Tax saving under Section 80C
c) Guaranteed returns
d) Long-term debt investment
152. Which type of fund focuses on preserving capital and liquidity?
a) Liquid fund
b) Equity fund
c) ELSS
d) Balanced fund
153. What is the typical lock-in period for ELSS?
a) 1 year
b) 2 years
c) 3 years
d) 5 years
154. Which risk cannot be diversified away?
a) Unsystematic risk
b) Systematic risk
c) Credit risk
d) Liquidity risk
155. What is the meaning of SIP?
a) Systematic Investment Plan
b) Scheduled Investment Payment
c) Single Investment Plan
d) Standard Investment Procedure
156. What is 'exit load'?
a) Charge levied at entry
b) Fee levied on redemption within specified period
c) Management fee
d) Distributor commission
157. Which document contains scheme features, objectives, and risk factors?
a) KIM/SID
b) Offer letter
c) AMC internal memo
d) Investor statement
158. Which fund invests primarily in government securities?
a) Equity fund
b) Gilt fund
c) ELSS
d) Balanced fund
159. Which entity regulates mutual funds in India?
a) AMFI
b) SEBI
c) RBI
d) NSDL
160. What is NAV?
a) Net Asset Value per unit
b) Total assets of AMC
c) Dividend payout
d) Expense ratio
161. What is the minimum investment for most mutual funds?
a) ₹500
b) ₹1,000
c) ₹5,000
d) ₹10,000
162. What is the role of the fund manager?
a) Manage portfolio and investment decisions
b) Audit mutual fund
c) Distribute units
d) Maintain investor KYC
163. What does 'AMFI' stand for?
a) Association of Mutual Funds in India
b) Asset Management Fund India
c) Annual Mutual Fund Index
d) Authorized Mutual Fund Institution
164. Which plan allows dividends to be reinvested automatically?
a) Growth option
b) Dividend reinvestment option
c) SWP
d) STP
165. Which is an example of systematic withdrawal?
a) SIP
b) SWP
c) STP
d) Lump-sum
166. Which is a key advantage of diversification?
a) Eliminates market risk
b) Reduces unsystematic risk
c) Guarantees returns
d) Increases NAV
167. What is the function of a custodian?
a) Maintain unit holder registry
b) Hold and safeguard securities
c) Regulate fund
d) Distribute units
168. Which is a type of debt instrument?
a) Commercial Paper
b) Equity share
c) ELSS unit
d) ETF
169. Who audits mutual fund accounts?
a) AMFI
b) Independent auditors
c) SEBI
d) RTA
170. Which type of fund invests both in equity and debt?
a) Equity fund
b) Balanced fund
c) Liquid fund
d) Gilt fund
171. Which document is mandatory for KYC compliance?
a) PAN card
b) Aadhaar
c) Bank statement
d) Passport
172. How often is NAV declared for open-ended funds?
a) Daily
b) Weekly
c) Monthly
d) Quarterly
173. What is the main goal of a liquid fund?
a) Capital appreciation
b) Short-term liquidity
c) Tax saving
d) Equity exposure
174. Which fund has higher potential returns?
a) Gilt fund
b) Equity fund
c) Debt fund
d) Liquid fund
175. What is a fund of funds?
a) Invests in stocks
b) Invests in other mutual funds
c) Invests in gold only
d) Invests in real estate
176. What is the lock-in period for NPS Tier 1?
a) 5 years
b) 10 years
c) Until retirement
d) 3 years
177. Which of these is a money market instrument?
a) Treasury bills
b) Equity shares
c) ELSS units
d) Balanced fund units
178. Who issues Key Information Memorandum (KIM)?
a) SEBI
b) AMC
c) RTA
d) AMFI
179. Which fund is suitable for short-term parking of surplus?
a) Liquid fund
b) Equity fund
c) Gilt fund
d) Balanced fund
180. Which type of fund invests in a specific sector?
a) Sectoral fund
b) Equity fund
c) Debt fund
d) Liquid fund
181. What is systematic transfer plan (STP)?
a) Regular withdrawal
b) Periodic transfer between schemes
c) Lump-sum investment
d) Dividend reinvestment
182. Who pays distributor commission?
a) Investors
b) AMC out of scheme revenues
c) SEBI
d) Registrar
183. Which ratio measures risk-adjusted return?
a) Alpha
b) Beta
c) Sharpe ratio
d) Expense ratio
184. Which is a long-term capital gains tax threshold for equity funds?
a) 12 months
b) 24 months
c) 36 months
d) 60 months
185. What is a close-ended fund?
a) Open for subscription anytime
b) Fixed maturity, traded on exchange
c) Allows SIP only
d) Only government investors
186. Which type of fund has high credit risk?
a) Gilt fund
b) Corporate bond fund
c) Liquid fund
d) Balanced fund
187. Which is an example of systematic investment?
a) Lump-sum
b) SIP
c) Dividend reinvestment
d) SWP
188. Which is true about beta of a fund?
a) Measures fund volatility relative to market
b) Measures NAV
c) Measures expense ratio
d) Measures tax efficiency
189. What is front-end load?
a) Entry fee
b) Exit fee
c) Trail commission
d) Dividend payout
190. What is back-end load?
a) Entry fee
b) Redemption fee
c) Management fee
d) Dividend option
191. Which fund primarily aims at tax saving?
a) Gilt fund
b) ELSS
c) Liquid fund
d) Balanced fund
192. Who maintains investor complaints registry?
a) AMC
b) SEBI
c) RTA
d) AMFI
193. Which is an open-ended fund?
a) Equity fund
b) NFO closed fund
c) FMP
d) Corporate bond scheme
194. What is the typical expense ratio range?
a) 0.5–3%
b) 5–10%
c) 10–15%
d) Above 15%
195. Which option represents dividend payout?
a) Reinvested units
b) Cash paid to investor
c) SIP installment
d) SWP withdrawal
196. Which fund is more volatile?
a) Equity fund
b) Debt fund
c) Liquid fund
d) Gilt fund
197. What is redemption?
a) Buying new units
b) Selling units and receiving cash
c) Transferring units to AMC
d) Switching schemes
198. Which type of risk is specific to an individual company?
a) Systematic risk
b) Unsystematic risk
c) Interest rate risk
d) Liquidity risk
199. What is alpha of a fund?
a) Risk-free return
b) Excess return over benchmark due to manager skill
c) NAV per unit
d) Expense ratio
200. Which fund is suitable for retirement planning with long-term horizon?
a) ELSS
b) Balanced fund
c) Liquid fund
d) Gilt fund