Q1.
___________ is a set of rules, behaviours and procedures which are designed to guide the selection of a portfolio of assets, which in turn is aligned to what you want and when you want it.
Q2.
Passive investment strategy seeks to maximize the returns by capitalizing on ups and downs in the market.
Q3.
Which of the following is not one of the four vectors of active investment strategy?
Q4.
____________ fund managers try to outperform the benchmark index.
Q5.
Which of the following statement/s is/are correct about asset allocation? 1. Asset allocation means investing an individual’s money for meeting the goals, needs etc in equities, fixed-income, and cash and equivalents based on the risk profiling and expected return of the individual. 2. Asset Allocation provides for a direction to the future income, cash flows of the investor in terms of where he should invest to achieve his financial goals. 3. Real estate, precious metals and other alternative assets are excluded from the asset classes used for the purpose of asset allocation.
Q6.
Which of the following statements about active investment strategies is incorrect?
Q7.
Asset class/es that provides/ investor with regular income flows with minimal risk is/are:
Q8.
Which of the following is not a disadvantage of real estate as an asset class?
Q9.
Which of the following asset classes is generally used as a hedge against inflation in India?
Q10.
In which of the following asset classes there is no exact measure for valuation?
Q11.
Which of the following are important while arriving at an asset allocation?
Q12.
For a risk free asset, the actual returns should always be equal to the expected return.
Q13.
Which of the following statements is incorrect about a risky asset?
Q14.
Which of the following analysis is/are undertaken by a portfolio manager in a market timing strategy?
Q15.
__________ strategy is based on an outlook of the aggregate market.
Q16.
Value style of investing focuses on stocks which have
Q17.
A strategy in which an investor buys an asset and holds on to the investment with an objective to earn returns over the long term is:
Q18.
Which of the following is not a reason for adopting a passive strategy?
Q19.
________ style/s provides value over the long term on a risk adjusted basis.
Q20.
An investor invests in a stock of a company that is growing rapidly. What is his investment style?
Q21.
In an active investment strategy, the time and effort are required only at the time of constructing the portfolio.
Q22.
Which investment strategy assumes that all securities are fairly valued?
Q23.
A vehicle where you commit yourself to invest a fixed amount regularly for a pre defined period is:
Q24.
A service offered by a mutual fund that provides a specific payout amount to the shareholder at predetermined intervals, generally monthly, quarterly, semi-annually or annually.
Q25.
Which of the following is not a reason for using systematic withdrawal plans?
Q26.
Investors use _______who want to invest lump sum money in schemes with stable returns and ensure small exposure to equity schemes in order to avail of the potential for higher growth through equities.
Q27.
_________ Plan should be used when markets have peaked or the investor is unsure of the further uptrend in the market.
Q29.
Growth investment style bets on popular stocks in the market?
Q30.
Asset allocation of an investor in stocks and bonds is 70:30. The portfolio manager believes that equity markets are headed for a downside and changes the allocation to 40:60. This strategy is known as:
Q31.
An asset that provides returns that are uncorrelated with the risky investments in the market is a risky asset.
Q32.
Which of the following statement/s is/are correct about diversification? 1. Diversification reduces the risk in a portfolio 2. Diversification reduces both potential upside and downside. 3. Cross border diversification is based on the premise that investments are made across the nations whose economic cycles are relatively independent of each other.
Q33.
Arrange the following steps of formal approach of strategic asset allocation in a sequence: 1. Define what would be an efficient frontier (where maximum returns are achieved with minimum risk) containing the entire efficient portfolio’s on the risk return graph. 2. Determine the expected returns and the risk parameters of standard deviation, correlation of the two asset categories of stocks and bonds etc. 3. Choose an asset allocation on the risk return graph where the optimal portfolio is the point of tangency between the efficient frontier and the utility indifference curve. 4. Specify the indifference curves reflecting the risk disposition of the investor. Indifference curves represent the risk and the return profile for a customer which is unique for each individual. All the Points lying on the indifference curves represent the same level of satisfaction.
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Q34.
Buying an asset when it is perceived to be undervalued and selling it when it is perceived to be overvalued is _________ asset allocation.
Q35.
Asset allocation strategy where the asset allocation is linked to the investor’s financial goals is:
Q36.
Which of the following is not a step of informal approach in strategic asset allocation?
Q37.
Markowitz efficient portfolios lie on the
Q38.
All the points lying on the indifference curves represent the same level of satisfaction.
Q39.
Asset allocation where the investor invests in an asset class when it is perceived to be cheaper and sell the asset when it is perceived to be overvalued is:
Q40.
Which of the following stage would comprise of most aggressive proportion into equity and a very small portion into fixed income instruments?
Q41.
In which stage the primary objective of this client is to generate long term capital growth with average emphasis on current income and capital preservation?
Q42.
In which stage the primary objective of this client is to invest in a portfolio that is evenly split between interest bearing securities and growth oriented investments?
Q43.
In which stage, a high level of stable income is sought by investing in fixed income securities with exposures to government bonds and securities and other fixed income asset class?
Q44.
In which of the following stages, capital preservation is most important for the investor?
Q45.
In which of the following stages, would the ideal allocation be 55:45 between income and growth assets?
Q46.
Which of the following is not a step involved in goal linked asset allocation?
Q47.
__________ is the ongoing process of reviewing and valuation of the portfolio composition consisting of various asset classes.
Q48.
__________ is the action of bringing a portfolio of investments that have deviated away from the targeted asset allocation back into its original allocation.
Q49.
In which of the following rebalancing policies, the portfolio is allowed to drift with no steps taken to change the portfolio allocation?
Q50.
In which of the following rebalancing policies, the mix of asset allocation is maintained in accordance to what is its target allocation?
Q51.
In which of the following rebalancing policies, it is ensured that the portfolio value does not fall below a floor price?
Q52.
Which of the following makes need based review necessary?
Q53.
Which of the following is/are the way/s to rebalance a portfolio?
Q54.
Which of the following is not a basic policy in respect to rebalancing?
Q55.
A review or a rebalancing of the portfolio is required to be done based on the market predictions by the portfolio manager.
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