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NCCMP Test Paper

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Question 1 of 45

1. Spot Nifty is at 5000. One month Nifty put with strike price of Rs. 5200 is trading at Rs. 250 per put. An investor buys 200 Nifty puts. At expiry Nifty closes at 5250. Net profit/loss of the investor is Rs _________.

(+) 30000

(-) 30000

(+)50000

(-) 50000

Question 1 of 45

Question 2 of 45

2. _________ rates are also used to curb the effect of inflation especially when the inflation is high.

Real Interest

Nominal Interest

Interest

Question 2 of 45

Question 3 of 45

3. Properly analyzed and interpreted financial statements can provide valuable insights into a firm's performance.

True

False

Question 3 of 45

Question 4 of 45

4. "In the class of equity derivatives the world over, futures and options on stock indices have gained more popularity than on individual stocks".

True

False

Question 4 of 45

Question 5 of 45

5. A corporate manager can define exposure limits for the branches of the firm.

True

False

Question 5 of 45

Question 6 of 45

6. "____________ are scarce, while human wants are unlimited".

Opportunities.

Business.

Start ups

Resources.

Question 6 of 45

Question 7 of 45

7. Transfer of resources from those having idle resources (investors) to others who have a need for them (corporates) is most efficiently achieved through the __________.

Insurance market

Banking system

Securities market

Corporates.

Question 7 of 45

Question 8 of 45

8. "Controllable, internal factors some what peculiar to industries and / or firms are referred to as sources of ___________ risk".

Systematic.

Unsystematic.

Question 8 of 45

Question 9 of 45

9. __________ shares are issued out of the Company's free reserve or share premium account in a particular ratio to the number of securities held on a record date.

Rights issue.

Bonus issue.

Question 9 of 45

Question 10 of 45

10. _____________ is the rate of interest an investor expects to receive after subtracting inflation.

Real inflation rate.

Real interest rate.

Adjusted interest rate.

Adjusted inflation rate.

Question 10 of 45

Question 11 of 45

11. _________ buy and sell currencies in the hope of profiting from price movements.

Arbitrageurs.

Speculators.

Hedgers.

Question 11 of 45

Question 12 of 45

12. "A _________ is a corporate action which splits the existing shares of a particular face value into smaller denominations so that the number of shares increase, however, the market capitalization or the value of shares held by the investors post - split remains the same as that before the split".

Preferential allotment.

Stock split.

Bonus.

Rights.

Question 12 of 45

Question 13 of 45

13. The products in the commodity derivatives markets can be categorized into Non-Agricultural Products and Agricultural Products.

True

False

Question 13 of 45

Question 14 of 45

14. An investor bought 200 Nifty Futures at Rs. 4500 per future. He sold them at Rs. 5000 per future. Total profit/loss is Rs. ________

(+)5000

(+) 10000

(-) 10000

(-)5000

Question 14 of 45

Question 15 of 45

15. The __________ market is a market for very short-term funds.

Call money.

Put money.

Equity.

Bond.

Question 15 of 45

Question 16 of 45

16. "This is a method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volume."

Technical analysis

Fundamental analysis

Question 16 of 45

Question 17 of 45

17. For the purpose of settlement all clearing members are required to open a separate bank account with NSCCL designated clearing bank for F&O segment.

True

False

Question 17 of 45

Question 18 of 45

18. ____________ is the price demanded by the lender from the borrower for the use of borrowed money.

Interest

Commission

Dividend.

Bonus

Question 18 of 45

Question 19 of 45

19. _____________ are a significant improvement over the forward contracts as they eliminate counter-party risk and offer more liquidity.

Futures.

OTC trades.

Bilateral contracts.

Swaps.

Question 19 of 45

Question 20 of 45

20. ______________ arises from the possibility of default by any one party to the transaction?

Major party risk.

Opposite party risk.

Counter-party risk.

Minor party risk.

Question 20 of 45

Question 21 of 45

21. An investor sold 200 Nifty Futures at Rs. 4500 per future. He bought them back at Rs. 5000 per future. Total profit/loss is Rs. __________

(+)5000

(-)10000

(+)10000

(-)5000

Question 21 of 45

Question 22 of 45

22. The final settlement price is the closing price of the equity index futures contract on the last trading day of the contract.

True

False

Question 22 of 45

Question 23 of 45

23. The _______ provides a central convenient place where buyers and sellers can easily purchase and sell securities.

Money market.

Currency markets.

Stock exchange.

Banks.

Question 23 of 45

Question 24 of 45

24. Spot Nifty is at 5000. One month Nifty call with strike price of Rs. 4800 is trading at Rs.250 per call. An investor buys 200 Nifty calls. At expiry Nifty closes at 4800. Net profit / loss of the investor is Rs. ________.

(-) 50000

(+) 30000

(-) 30000

(+) 50000

Question 24 of 45

Question 25 of 45

25. Financial markets allow a transfer of __________ from those who undertake investments to those who provide funds for those investments.

Risk.

Debt.

Equity.

Goodwill.

Question 25 of 45

Question 26 of 45

26. "The settlement amount for a Clearing Member is ________ across all their Trading Members / clients, with respect to their obligations on MTM, premium and exercise settlement".

Netted.

Grossed.

Question 26 of 45

Question 27 of 45

27. A primary motivation for pre-arranging a buyer or seller for a stock of commodities in early forward contracts was to lesser the possibility that large swings would inhibit marketing the commodity after a harvest.

True

False

Question 27 of 45

Question 28 of 45

28. "When an issue of securities is made by an issuer to its shareholders existing as on a particular date fixed by the issuer (i.e. record date), it is called a __________"

Rights issue

Bonus issue

Question 28 of 45

Question 29 of 45

29. "Inflation can be high, moderate or low."

True

False

Question 29 of 45

Question 30 of 45

30. Spot Nifty is at 5000. One month Nifty put with strike price of Rs. 5100 is trading at Rs. 150 per put. An investor buys 200 Nifty puts. At expiry Nifty closes at 4800. Net profit / loss of the investor is Rs. __________.

(-) 30000

(+) 50000

(-) 50000

(+) 30000

Question 30 of 45

Question 31 of 45

31. An investor sold 100 Nifty Futures at Rs. 4500 future. He bought them back at Rs. 5000 per future. Total profit / loss is Rs. _____________

(+) 4000

(-) 4000

(-) 5000

(+) 5000

Question 31 of 45

Question 32 of 45

32. "An investor buys Rs. 2,00,000 worth of index futures. The maximum brokerage that can be charged to the investor is Rs. ___________."

2000

3000

5000

1000

Question 32 of 45

Question 33 of 45

33. __________ are claims on the borrower's future income or assets.

Assets.

Securities.

Liabilities.

Collateral

Question 33 of 45

Question 34 of 45

34. "In a ______________ contract, the contract price is generally not available in public domain."

Forward.

Futures.

Question 34 of 45

Question 35 of 45

35. "Technical analysis has universal applicability. It can be applied to any financial instrument - stocks, futures and commodities, fixed - income securities, forex, etc."

True

False

Question 35 of 45

Question 36 of 45

36. "As per the Securities Contract Regulation Act, in India, derivatives are legal and valid only if such contracts are traded on a recognized stock exchange".

True

False

Question 36 of 45

Question 37 of 45

37. "By using the _________ forward market to sell dollars forward, the exporter can lock on to a rate today and reduce his uncertainty."

Commodities.

Bond.

Currency.

Equity.

Question 37 of 45

Question 38 of 45

38. "To alert investors to the potential effects of management stock options and convertible securities, a second EPS is calculated by certain companies, which is called the _________ EPS".

Diluted.

Second.

Extra.

Additional.

Question 38 of 45

Question 39 of 45

39. ___________ is spreading your money across a range of investments.

Asset allocation.

Correlation.

Hedging.

Diversification.

Question 39 of 45

Question 40 of 45

40. A __________ economic indicator is one that does not change direction until a few quarters after the economy does.

Lagged.

Leading.

Question 40 of 45

Question 41 of 45

41. Spot Nifty is at 5000. One month Nifty call with strike price of Rs. 4800 is trading at Rs. 250 per call. An investor buys 100 Nifty calls. At expiry Nifty closes at 5500. Net profit / loss of the investor is Rs. _______.

(+)50000

(-)50000

(+)45000

(-) 45000

Question 41 of 45

Question 42 of 45

42. Derivatives can be traded on _________.

Equity.

Forex.

Commodities.

All of the above

Question 42 of 45

Question 43 of 45

43. Doji lines are patterns with the same open and close price.

True

False

Question 43 of 45

Question 44 of 45

44. "A __________ believes that it is possible to identify a trend, invest or trade based on the trend and make money as the trend unfolds".

Fundamental analyst.

Technical analyst.

Question 44 of 45

Question 45 of 45

45. An investor bought 100 Nifty Futures at Rs. 4500 per future. He sold them at Rs. 5000 per future. Total profit / loss is Rs. _________

(+)5000

(-) 5000

(+) 4000

(-) 4000

Question 45 of 45

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