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Advanced Wealth Management Course (IIBF) - Paper 5
Ch 1: Concept and Role of Mutual Fund
Q
1
.
(I) Mutual funds are ‘get rich quick investments’. (II) Mutual fund is a universal solution to all investment needs.
Both the statements are correct
Only statement (I) is correct
Only statement (II) is correct
Both the statements are wrong
Q
2
.
A mutual fund product with ____________ allows the investor to maintain a target mix of debt and equity in one’s portfolio.
Systematic Investment Plan (SIP)
Systematic Transfer Plan (STP)
Systematic Withdrawal Plan (SWP)
Flexi Withdrawal Plan (FWP)
Q
3
.
Which plan enables withdrawal of different amounts of money for different months?
Systematic Withdrawal Plan (SWP)
Systematic Investment Plan (SIP)
Flexi Withdrawal Plan (FWP)
Systematic Transfer Plan (STP)
Q
4
.
(I) Systematic Withdrawal Plan (SWP) is a mirror image of SIP. (II) Mutual funds are assured return investments.
Both the statements are correct
Only statement (I) is correct
Only statement (II) is correct
Both the statements are wrong
Q
5
.
(I) Mutual funds are risk free investments. (II) A mutual fund product with Systematic Investment Plan (SIP) refers to the practice of investing a constant amount every month.
Both the statements are correct
Only statement (I) is correct
Only statement (II) is correct
Both the statements are wrong
Q
6
.
The systematic risk that can be effectively diversified by investing in adequate number of securities.
True
False
Q
7
.
Which is the wrong advantage that mutual funds offer to the investors over direct investing?
Risk reduction through diversification
Lower transaction and other costs
Regulatory protection
Convenience
None of the above
Q
8
.
Mutual fund unit holders are the funds shareholders, while bank depositors are the banks’ creditors.
True
False
Q
9
.
The term ‘mutual’ is used in the sense that all its returns, plus its expenses, are shared by the fund’s unit holders.
True
False
Q
10
.
(I) Mutual funds are subject to strict regulation and oversight by SEBI. (II) SEBI requires the open-ended fund to stand ready to redeem the units on a daily basis at its NAV based price.
Both the statements are correct
Only statement (I) is correct
Only statement (II) is correct
Both the statements are wrong