Investment-Planning-Mock Test CFP

June 13, 2018 | Author: bitterhoney4871 | Category:Dividend
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Simulated Test 02 Question 1 Marks: 1 Suneel has asked you a practicing CERTIFIED FINANCIAL PLANNER CM about the ownership of CFPCM mark in the world. You have explained to him that _________________
Choose one answer
a. CFPCM mark is owned by FPSB India b. CFPCM mark is owned by FPSB across the world c. CFPCM mark is owned by CFPCM Board across the world d. CFPCM mark is owned by FPSB, Denver (US) outside the United States Question 2 Marks: 1 You, being a Financial Planner, would help your client to set his financial goals in __________
Choose one answer
a. Any term as desired by him b. Both current & future money terms c. Current money terms d. Future money terms Question 3 Marks: 1 Your client has asked you to give him a written assurance that if you prepare a Financial Plan for him, then in no case you would reveal any of his information to any other person, including his family members. As per FPSB Code of Ethics, is it possible for you?
Choose one answer
a. Yes b. No c. Yes but with prior consent of all relevant family members
d. No because client has no authority to demand such type of assurance
Question 4 Marks: 1 Under the efficient market hypothesis, which of the following term best describes the movement of stock prices?
Choose one answer
a. Statistical b. Random
c. Diverse d. Predictable Question 5 Marks: 1 A share holder who has paid for the first call, in a limited company, is liable for _______
Choose one answer
a. His share in the total liabilities of the company b. Partially paid-up amount of the shares allotted to him c. Fully paid-up value of the shares allotted to him d. Only the secured debt of the company Question 6 Marks: 1 Among the given four bonds, each having a 20 years maturity, which one of them is the most volatile?
Choose one answer
a. BB-rated corporate b. Municipal c. Treasury d. Zero Coupon Question 7 Marks: 1 Principal vectors of an active portfolio strategy are:
Choose one answer
a. Market timing
b. Sector rotation
c. Security selection d. All of the above
Question 8 Marks: 1 Share holder in a limited company who has paid for the first call is liable for________
Choose one answer
a. His partially paid-up amount of the shares allotted to him b. His share in the total liabilities of the company c. Fully paid-up value of the shares allotted to him d. Only the secured debt of the company Question 9 Marks: 1
What is the reliable source of pertinent information for the investor in Mutual fund scheme?
Choose one answer
a. Advice of distributor
b. AMFI website c. Financial press d. Offer Document Question 10 Marks: 1
Choose one answer
a. (A) is correct
b. (B) is correct
c. Both (A) and (B) are correct
d. Both (A) and (B) are incorrect
Question 11 Marks: 1 (A)For a Call option: Intrinsic Value = Spot price – Strike Price. Intrinsic value must be positive or zero
(B)For a Put Option: Intrinsic Value = Strike price – Spot Price. Intrinsic value must be positive or zero
Choose one answer
a. (A) is correct
b. (B) is correct
c. Both (A)and(B) are correct
d. Both (A)and(B) are incorrect
Question 12 Marks: 1 (A) Beta reflects the systematic risk of the portfolio
(B) Beta reflects the unsystematic risk of the portfolio
Choose one answer
a. (A) is correct
b. (B) is correct
c. Both (A)and(B) are incorrect
d. Both (A)and(B) are correct
Question 13 Marks: 1 For maintaining flexible ratio of asset allocation, one should ________________
Choose one answer
a. Rebalance the debt/equity allocation very frequently b. Keep fixed percentage of equity and debt investments at all times c. Generally avoid portfolio rebalancing d. Rebalance the debt/equity allocation periodically Question 14 Marks: 1 (A) Constant proportion portfolio insurance policy (CPPI policy) is the worst stock market moves in only one direction, either up or down
policy if the
(B) Constant proportion portfolio insurance policy (CPPI policy) is the best policy if the stock market moves in only one direction, either upordown
Choose one answer
a. (A) is correct
b. (B) is correct
c. Both (A) and (B) are correct
d. Both (A) and (B) are incorrect
Question 15 Marks: 1 If the current share price is S and the set exercise price is X, the intrinsic value of the Call Option is ______
Choose one answer
a. Max ( 0, S-X )
b. Max ( 0, X-S )
c. Min ( 0, S-X )
d. Min ( 0, X-S )
Question 16 Marks: 1 Bond prices are sensitive to the coupon rate of the bond and the maturity term of the bond
Bond prices are less sensitive to changes in interest rates when the bonds have_______
Choose one answer
a. Small coupons and short maturity
b. Large coupons and long maturity c. Large coupons and short maturity d. Small coupons and long maturity Question 17 Marks: 1 Among the given four bonds, each having a 20 years maturity, which one of them is the most volatile?
Choose one answer
a. Zero Coupon
b. Treasury
c. Municipal
d. BB-rated corporate
Question 18 Marks: 1 A PPF account was opened on 10th July 1990. It will mature on ________
Choose one answer
a. 11/07/2005 b. 10/07/2005 c. 09/07/2005 d. 01/04/2006 Question 19 Marks: 1 Convertible debentures are valued on the basis of Market Value
Choose one answer
a. This statement is false
b. This statement is true
c. Cannot say
d. Sometimes
Question 20 Marks: 1 T-bills pay interest to their investors by __________
Choose one answer
a. T-bills pay no interest
b. Coupon interest
c. Possible price appreciation above their discounted price d. Difference between Issue price and face value
Question 21
Marks: 1 The bid-ask spread is________
(A) Broker’s commission (B) Dealer’s gross income from a transaction (C) Larger for illiquid securities than for liquid ones
Choose one answer
a. (A) only b. (B) only c. (C) only d. (B) & ( C) Question 22 Marks: 1 A crucial feature of Group Insurance Plan is that _______
Choose one answer
a. They are not aleatory contracts b. The insured can alter the policy’s terms and conditions c. The insured must be insurable d. They are not portable Question 23 Marks: 1 Client should be helped to set his/her financial goals in _________
Choose one answer
a. Future money terms b. Current money terms c. Current money terms & future money term d. None of the above Question 24 Marks: 1 Suresh, a Certified Financial Planner CM, is preparing a letter to circulate among prospective clients and the letter contains information on services provided by his firm. According to the Code of Ethics and Rules of Professional Conduct, all of the following information should appear in the letter except ________
Choose one answer
a. Details of firm’s portfolio size and composition b. The fees and commission sources of the firm c. Any significant financial relationships or connections with product providers d. Identity of the firm providing the service and the nature of services offered

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