McqMate
1. |
Liquidity risk is : |
A. | is risk investment bankers face. |
B. | is lower for small OTC |
C. | increases whenever interest rates increases |
D. | is risk associated with secondary market transactions |
Answer» C. increases whenever interest rates increases |
2. |
Bond holders usually accept interest payment each. |
A. | 1 year |
B. | six months |
C. | 2 months |
D. | 2 years |
Answer» B. six months |
3. |
Passive management is also referred to as.......? |
A. | index fund management |
B. | index folio management |
C. | interest free management |
D. | none of these |
Answer» A. index fund management |
4. |
Multifactor asset pricing model that can be used to estimate the ......rate for the valuation of financial asset. |
A. | discount |
B. | interest |
C. | expense |
D. | risk |
Answer» A. discount |
5. |
Arbitrate pricing theory is an ................. model. |
A. | asset pricing |
B. | risk evaluation |
C. | bond pricing |
D. | none of these |
Answer» A. asset pricing |
6. |
CAMP stands for . |
A. | capital asset pricing model |
B. | capital assessment pricing model |
C. | capital asset placement model |
D. | none of these |
Answer» A. capital asset pricing model |
7. |
An asset risk premium is given by : |
A. | the asset standard deviation |
B. | the assets expected returns |
C. | expected return per unit of standard deviation |
D. | the excess of the assets expected return over the riskless rates |
Answer» A. the asset standard deviation |
8. |
Which of the following is an example of a depreciable asset? |
A. | land |
B. | cash |
C. | account receivable |
D. | equipment |
Answer» D. equipment |
9. |
While bond prices fluctuate , |
A. | yeilds are constant |
B. | coupon are constant |
C. | the spread between yeilds is constant |
D. | short term bond prices fluctuate even more |
Answer» A. yeilds are constant |
10. |
To calculate historical (realised) risk and return, use; |
A. | ex-post data |
B. | mean and variance of expected return |
C. | probability distribution of possible states |
D. | ex- ante data |
Answer» A. ex-post data |
11. |
A price weighted index is an arithmetic mean of |
A. | future prices |
B. | current prices |
C. | quarter prices |
D. | none of these |
Answer» B. current prices |
12. |
A firm that fails to pay dividends on its preferred stock is said to be ……… |
A. | insolvent |
B. | in arrears |
C. | in sufferable |
D. | delinquent |
Answer» B. in arrears |
13. |
............... is not a money market instrument. |
A. | cerftificates of deposit |
B. | a treasury bill |
C. | a treasury bond |
D. | commercial paper |
Answer» C. a treasury bond |
14. |
A bond that has no collateral is called ...................... .? |
A. | collable bond |
B. | a debenture |
C. | a junk bond |
D. | a mortgage |
Answer» B. a debenture |
15. |
The process of addition of more assets in an existing portfolio is called.....? |
A. | portfolio revision |
B. | portfolio addition |
C. | portfolio exchanging |
D. | none of these |
Answer» A. portfolio revision |
16. |
------is the amount left over after individual consumption. |
A. | Investment |
B. | Savings |
C. | Surplus |
D. | Money. |
Answer» B. Savings |
17. |
--- include “expensive stocks” that offer big rewards but have big risk. |
A. | The patient portfolio |
B. | Conservative portfolio |
C. | Aggressive portfolio |
D. | Efficient portfolio |
Answer» B. Conservative portfolio |
18. |
Find the odd one. |
A. | Risk |
B. | Return |
C. | Safety |
D. | Tax evasion |
Answer» D. Tax evasion |
19. |
An investor committed money for very short period expect…. |
A. | Return from price fluctuation |
B. | Dividend |
C. | Benefit from both price variation and dividend |
D. | None of these |
Answer» A. Return from price fluctuation |
20. |
Investment in precious metals are included in ……… asset class. |
A. | Liquid assets |
B. | Financial assets |
C. | Real assets |
D. | Monetary assets |
Answer» C. Real assets |
21. |
The investment process begins with ------ |
A. | Investment policy |
B. | Security analysis |
C. | Portfolio construction |
D. | Fundamental analysis |
Answer» A. Investment policy |
22. |
Total risk includes--------- |
A. | Systematic risk only |
B. | Unsystematic risk only |
C. | Both a and b above |
D. | Only diversifiable risks |
Answer» C. Both a and b above |
23. |
Systematic risk includes------ |
A. | Market risk |
B. | Interest rate risk |
C. | Purchasing power risk |
D. | All the above |
Answer» D. All the above |
24. |
Which among the following statements are true about unsystematic risk? |
A. | It is diversifiable |
B. | It is company specific |
C. | Both a and b |
D. | a only |
Answer» C. Both a and b |
25. |
Which among the following is true about systematic risk? |
A. | It is not diversifiable |
B. | a only |
C. | Its measure is Beta |
D. | Both a and c |
Answer» D. Both a and c |
26. |
According to Graham, a stock should have a current ratio of at least--- |
A. | One |
B. | Two |
C. | Three |
D. | Four |
Answer» B. Two |
27. |
--------is the process of combining together various investment assets to obtain optimum returns with minimum risk. |
A. | Portfolio construction |
B. | Portfolio analysis |
C. | Portfolio evaluation |
D. | Portfolio revision |
Answer» A. Portfolio construction |
28. |
Modern portfolio theory is a contribution by……… |
A. | William sharp |
B. | Benchamin Graham |
C. | Stephen Rose |
D. | Harry Markowitz |
Answer» D. Harry Markowitz |
29. |
MACD stands for ----- |
A. | Managing asset classes for dividend |
B. | Multiple asset class deposit |
C. | Moving average convergence divergence |
D. | Main asset class deposit |
Answer» C. Moving average convergence divergence |
30. |
The concept ’never putting all your eggs in one basket’ is explained in --- |
A. | Markowitz Model |
B. | Sharp single index Model |
C. | Multi Index Model |
D. | APT |
Answer» A. Markowitz Model |
31. |
Who introduced mean variance analysis in portfolio theory? |
A. | William Sharp |
B. | Harry Markowitz |
C. | F.Amling |
D. | Kritzman |
Answer» B. Harry Markowitz |
32. |
Unsystematic risk may arise due to the following reason. |
A. | Change in interest rate |
B. | Increase in population |
C. | Employee strike in the company |
D. | Exchange rate fluctuations |
Answer» C. Employee strike in the company |
33. |
A higher standard deviation is an indicator of---- |
A. | Greater risk and higher potential returns |
B. | Moderate risk and higher potential returns |
C. | Lower risk and higher potential returns |
D. | Greater risk and lower potential returns |
Answer» A. Greater risk and higher potential returns |
34. |
If the returns of two securities are unrelated, the covariance will be--- |
A. | Positive |
B. | Negative |
C. | Zero |
D. | One |
Answer» C. Zero |
35. |
Portfolios included in the risk return space is called------ |
A. | Feasible set |
B. | Efficient portfolio |
C. | High return portfolio |
D. | Risky portfolio |
Answer» A. Feasible set |
36. |
The concept efficient frontier is a contribution by----. |
A. | Robert Rhea |
B. | E.GeorgeSchaefer |
C. | Charles H.Dow |
D. | Harry Markowitz |
Answer» D. Harry Markowitz |
37. |
A fully diversified portfoliocontains securities which have--- |
A. | Only unsystematic risk |
B. | Both systematic and unsystematic risk |
C. | Only systematic risk |
D. | No risk |
Answer» C. Only systematic risk |
38. |
----- is the measure of risk in the case portfolio with two securities. |
A. | Correlation |
B. | Covariance |
C. | Standard deviation |
D. | Beta |
Answer» C. Standard deviation |
39. |
Value of Beta above 1 implies--- |
A. | Higher risk than the market average |
B. | Less risk than market average |
C. | Less risk than risk free investment |
D. | None of the above |
Answer» A. Higher risk than the market average |
40. |
CML stands for. |
A. | Convergence Market Line |
B. | Critical Market Line |
C. | Critical Maturity Line |
D. | Capital Market Line |
Answer» D. Capital Market Line |
41. |
------- is also called characteristic Lines. |
A. | CML |
B. | SML |
C. | Efficient Frontier |
D. | CAL |
Answer» B. SML |
42. |
Efficient frontier is situated at -------- boundary of opportunity set. |
A. | North west |
B. | North east |
C. | South west |
D. | South east |
Answer» A. North west |
43. |
Arbitrage Pricing Theory was introduced by--- |
A. | Charles Dow |
B. | Benchamin Graham |
C. | William sharp |
D. | Stephen S.Rose |
Answer» D. Stephen S.Rose |
44. |
Which pricing model provides no guidance on the determination of the risk premium factor? |
A. | The Multifactor APT |
B. | The CAPM |
C. | Both CAPM &Multifactor APT |
D. | Neither the CAPM nor Multifactor APT |
Answer» A. The Multifactor APT |
45. |
. -------- is an example for oscillators. |
A. | ROC |
B. | RSI |
C. | MACD |
D. | All the above |
Answer» D. All the above |
46. |
The APT differs from CAPM because the APT. |
A. | Places more emphasis on market risk |
B. | Recognizes multiple systematic risk factors |
C. | Recognizes multiple unsystematic risk factors |
D. | Minimizes the importance of diversification |
Answer» B. Recognizes multiple systematic risk factors |
47. |
----------- focus more on past price movement of a firm’s stock than on the underlying determinants of future profitability. |
A. | Credit Analysis |
B. | Fundamental Analysis |
C. | Systems Analysis |
D. | Technical Analysis |
Answer» D. Technical Analysis |
48. |
RAPM stands for ----- |
A. | Risk Adjustment Performance Matrix |
B. | Risk Adjusted Performance Measure |
C. | Risk return Analysis of portfolio management |
D. | Risk Adjusted portfolio Measure |
Answer» A. Risk Adjustment Performance Matrix |
49. |
Reward to variability Ratio is---- |
A. | Traynor Ratio |
B. | Sharp Ratio |
C. | Jenson Ratio |
D. | Book Market Ratio |
Answer» B. Sharp Ratio |
50. |
Reward to volatility Ratio is also called as---- |
A. | Treynor Ratio |
B. | Sharp Ratio |
C. | Jenson Ratio |
D. | Book market Ratio |
Answer» A. Treynor Ratio |
51. |
Michel C. Jenson introduced; |
A. | Reward to variability ratio |
B. | Reward to volatility Ratio |
C. | Differential return measure |
D. | Price book ratio |
Answer» C. Differential return measure |
52. |
Treynor Ratio is calculated using--- |
A. | Standard deviation |
B. | Beta |
C. | Alpha |
D. | Both Alpha and Beta |
Answer» B. Beta |
53. |
When alpha ‘p’ is positive, it shows--- |
A. | Superior return |
B. | Neutral performance |
C. | Worst performance |
D. | None of the above |
Answer» A. Superior return |
54. |
Which of the following is a defensiveshares? |
A. | Beta>1 |
B. | Beta<1 |
C. | Beta=1 |
D. | Beta=0 |
Answer» B. Beta<1 |
55. |
NSE established on--- |
A. | 1875 |
B. | 1785 |
C. | 1990 |
D. | 1992 |
Answer» D. 1992 |
56. |
------- is a person who believes in lower expected return at reduced risk. |
A. | Hedgers |
B. | Arbitrageurs |
C. | Speculators |
D. | Spreaders |
Answer» D. Spreaders |
57. |
Who is the author of the book“Security Analysis and The Intelligent Investor” |
A. | John Maynard Keynes |
B. | Kritzman |
C. | Benjamin Graham |
D. | Harry Markowitz |
Answer» C. Benjamin Graham |
58. |
---‐--- is putting money at risk by betting on an uncertain outcome with the hope that you might win money. |
A. | Investment |
B. | Gambling |
C. | Financing |
D. | Portfolio |
Answer» B. Gambling |
59. |
Total risk is associated with ---- |
A. | Standard deviation |
B. | Beta |
C. | Alpha |
D. | Correlation |
Answer» A. Standard deviation |
60. |
Which of the following is not related with a bond? |
A. | Dividend |
B. | Residential maturity |
C. | ESOP |
D. | Spot interest rate |
Answer» D. Spot interest rate |
61. |
--------- is the bonds issued at a considerable discount and repaid at par. |
A. | Deep discount bond |
B. | Callable bond |
C. | Floating rate note |
D. | Junk bonds |
Answer» A. Deep discount bond |
62. |
Which of the following is a PSU bond? |
A. | Cumulative Interest bonds |
B. | Step up bonds |
C. | Tax free bonds |
D. | Monthly return bonds |
Answer» C. Tax free bonds |
63. |
----- are issued by a group of multinational banks. |
A. | Domestic bonds |
B. | Foreign bonds |
C. | Euro bonds |
D. | Junk bonds |
Answer» C. Euro bonds |
64. |
YTM is the most widely used measure to know the return on----- |
A. | Equity |
B. | Derivatives |
C. | Bonds |
D. | Preference shares |
Answer» C. Bonds |
65. |
------is the discount rate that makes present value of single cash inflow to cost of the bond. |
A. | Current yield |
B. | YTC |
C. | YTM |
D. | Spot interest rate |
Answer» D. Spot interest rate |
66. |
YTC is used in the case of------- bonds. |
A. | Irredeemable |
B. | Callable bonds |
C. | Redeemed on maturity |
D. | Convertible |
Answer» B. Callable bonds |
67. |
Bond price-yield relationship is referred to as ----- |
A. | Concave |
B. | Convex |
C. | Linear |
D. | Rectangular hyperbola |
Answer» B. Convex |
68. |
Bond pricing theorems was introduced by— |
A. | Harry Markowitz |
B. | Kritzman |
C. | F.Amling |
D. | Burton G.Malkiel |
Answer» D. Burton G.Malkiel |
69. |
Bond price will move --------- to market interest changes. |
A. | Inversely |
B. | Positively |
C. | Constant |
D. | Randomly |
Answer» A. Inversely |
70. |
------- is a measure of interest rate sensitivity of a bond. |
A. | YTM |
B. | HTC |
C. | Duration |
D. | Current yield |
Answer» C. Duration |
71. |
The theory of bond immunisation was introduced by------ |
A. | Redington |
B. | F.Amling |
C. | Burton G.Malkiel |
D. | Kritzman |
Answer» A. Redington |
72. |
---------- is a hedging method against the risk associated with changes in interest rates. |
A. | Macaules duration |
B. | Bond convexity |
C. | Bond immunisation |
D. | Effective duration |
Answer» C. Bond immunisation |
73. |
Which of the following relates to industry analysis? |
A. | Infrastructure facilities |
B. | Competitive forces |
C. | Interest rate |
D. | Market share |
Answer» B. Competitive forces |
74. |
Which is the most popular multiplier for valuing shares? |
A. | EPS/ stock price |
B. | P/E Ratio |
C. | Constant growth mode |
D. | One year holding model |
Answer» B. P/E Ratio |
75. |
--------ratio is used to estimate the value of stocks by the investors rather than adopting discounting models. |
A. | Price to sales ratio |
B. | Price to book ratio |
C. | Price earnings ratio |
D. | Dividend pay-out ratio |
Answer» C. Price earnings ratio |
76. |
-------is the study of historical stock prices and stock market behaviour to identify recurring pattern. |
A. | Fundamental Analysis |
B. | Technical Analysis |
C. | Economy Analysis |
D. | Industry Analysis |
Answer» B. Technical Analysis |
77. |
Dow Theory relates to--- |
A. | Primary trend |
B. | Short term trend |
C. | Seasonal pattern |
D. | Intermediate trend |
Answer» A. Primary trend |
78. |
Find the odd one. |
A. | Head and shoulder |
B. | Flags |
C. | Triangles |
D. | Candle sticks |
Answer» D. Candle sticks |
79. |
Price movements inzigzagfashion with any rise or fall interrupted by counter movements are known as-------- |
A. | Trend Reversal |
B. | Consolidation |
C. | Reactions |
D. | Penetration |
Answer» C. Reactions |
80. |
Which among the following is a market indicator? |
A. | Oscillators |
B. | MACD |
C. | Odd-lot-index |
D. | Moving average |
Answer» C. Odd-lot-index |
81. |
Random Walk Theory was popularised by---- |
A. | Burton Malkiel |
B. | Redington |
C. | Charles Dow |
D. | F.Amling |
Answer» A. Burton Malkiel |
82. |
Elliot Wave Theory was introduced in the year---- |
A. | 1949 |
B. | 1934 |
C. | 1926 |
D. | 1926 |
Answer» B. 1934 |
83. |
The oldest approach to common stock selection is----- |
A. | Fundamental Analysis |
B. | Technical Analysis |
C. | Random walk Analysis |
D. | Value Analysis |
Answer» B. Technical Analysis |
84. |
Technical Analysis reflects the idea that stock prices------------ |
A. | Move upward over time |
B. | Move inversely over time |
C. | Move in trends |
D. | Move randomly |
Answer» C. Move in trends |
85. |
Which of the following is a tool in technical analysis to determine whether a security is a good for investment? |
A. | The Price earnings ratio |
B. | Balance sheet |
C. | Income statement |
D. | Trend lines |
Answer» D. Trend lines |
86. |
Line charts are formed by connecting------- of each time frame. |
A. | Average price |
B. | Highest of the day |
C. | Closing price |
D. | Lowest of the day |
Answer» C. Closing price |
87. |
Triangles are ------ patterns. |
A. | Continuation |
B. | Reversal |
C. | Support and resistance |
D. | None of the above |
Answer» A. Continuation |
88. |
--------movements are typically referred to as bullish and bearish. |
A. | Secondary |
B. | Daily |
C. | Major |
D. | Primary |
Answer» D. Primary |
89. |
Process of selling of shares that is not owned by a person is termed as… |
A. | Hedging |
B. | Short-selling |
C. | Broking |
D. | Quoting |
Answer» B. Short-selling |
90. |
At resistance level a technical analysis expect the ----- |
A. | Demand of a stock to decrease substantially |
B. | Demand of a stock increase substantially |
C. | Supply of a stock to Increase substantially |
D. | Supply of a stock decrease substantially |
Answer» A. Demand of a stock to decrease substantially |
91. |
Which of the following represents an upper price limit for a stock, based on the quantity of willing sellers? |
A. | Candle |
B. | Trend line |
C. | Support |
D. | Resistance |
Answer» D. Resistance |
92. |
Which of the following do a technical analysis believe is a lower bound on a stock’s price? |
A. | Candle |
B. | Support |
C. | Trend line |
D. | Resistance |
Answer» B. Support |
93. |
Barometric approach is used for----- |
A. | Economic forecasting |
B. | Trend prediction |
C. | Price estimation |
D. | Dividend forecasting |
Answer» A. Economic forecasting |
94. |
Opportunistic model building is also known as----- |
A. | Econometric model building |
B. | Mathematical model building |
C. | Sectorial analysis |
D. | Anticipatory surveys |
Answer» C. Sectorial analysis |
95. |
The last step in fundamental analysis is |
A. | Economic Analysis |
B. | Industry Analysis |
C. | Company Analysis |
D. | Technical Analysis |
Answer» C. Company Analysis |
96. |
Which of the following is a financial investment? |
A. | Share |
B. | Farm house |
C. | Car |
D. | T. V. Set |
Answer» A. Share |
97. |
Which of the following is tax saving investment? |
A. | Fixed deposit |
B. | Shares |
C. | PPF |
D. | Post office saving |
Answer» C. PPF |
98. |
All personal investing is designed to achieve certain ….. |
A. | Objective |
B. | Investment |
C. | Risk |
D. | Returns |
Answer» A. Objective |
99. |
The object of portfolio is to reduce ……by diversification |
A. | Return |
B. | Risk |
C. | Uncertainty |
D. | Percentage |
Answer» B. Risk |
100. |
The fundamental analysis approach has been associated with ….. |
A. | Uncertainties |
B. | Certainties |
C. | Ratios |
D. | Balance sheet |
Answer» A. Uncertainties |
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