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Saturday, February 6, 2016

Security Analysis & Portfolio Management SCDL Solved Exam Paper 59

This solved paper of SCDL Security Analysis & Portfolio Management of SCDL Pune has been contributed by Deepak Goyal
 
Thanks To: Deepak Goyal
 
LIST OF ATTEMPTED QUESTIONS AND ANSWERS
 True/False
  Question 
In case of assured returns, A scheme cannot promise returns unless such returns are fully guaranteed by sponsor or AMC.
  Answer 
TRUE
 Multiple Choice Multiple Answer
  Question 
What are the features of short-term trends?
  Answer 
They last from 1 to 3 or 4 weeks , They interrupt the course of the intermediate cycle , They are usually influenced by random news events
 Multiple Choice Single Answer
  Question 
Who operates the sinking fund under the sinking fund provision of a firm?
  Answer 
The bond trustee or the issuer
 True/False
  Question 
Certificate of Deposits offers high rate of interest than Treasury Bills.
  Answer 
TRUE
 Multiple Choice Multiple Answer
  Question 
What developments had taken place during the year 2000 in case of Bharat Forge Ltd.?
  Answer 
Demerger of investment division and windmills , Nominee director of UTI resigned and ceased to be the director - nomination withdrawn by UTI
 True/False
  Question 
While calculating geometric mean calculation of root is not important.
  Answer 
FALSE
 Multiple Choice Single Answer
  Question 
The objective of fundamental analysis for a security in a market is to identify either it is :-
  Answer 
Under priced and over priced
 True/False
  Question 
A higher value of current ratio indicates a better short term solvency of the firm.
  Answer 
TRUE
 True/False
  Question 
A rise in interest rates will push the market prises of outstanding bonds where as a fall in interest rates will depress the market prices down.
  Answer 
FALSE
 Select The Blank
  Question 
The ________ phase carries a lot of significance because it marks the turning point between a rising and a falling market.
  Answer 
Transitional
 Match The Following
Question
Answer


Equity shares
High risk


Government Securities
No risk


Bank Deposits
Low risk


Mutual Funds
Average risk
 Select The Blank
  Question 
Secondary reactions occurs because of ________ which arise in the market as a result of over optimism and over pessimism.
  Answer 
Technical distortions
 True/False
  Question 
Bearish actions come from a series of declining peaks and troughs.
  Answer 
TRUE
 Multiple Choice Single Answer
  Question 
What is an open ended fund or scheme?
  Answer 
Which is available for subscription and repurchase on a continuous basis
 Match The Following
Question
Answer


Turnover ratios
Help measure the efficiency of utilisation of assets


Debt Equity ratio
Debt / Equity


Quick assets
Highly liquid assets


Average collection period
Similar to debtors turnover
 Multiple Choice Single Answer
  Question 
The present value of all the future cash payments to be paid on the security to the investor is termed as :-
  Answer 
Intrinsic value of a security
 Select The Blank
  Question 
Dow Jones transportation average was previously known as ________.
  Answer 
Rail average
 True/False
  Question 
The basic assumption of Technical analysis is that, price discounts everything and it is the outcome of all forces affecting a stock.
  Answer 
TRUE
 Multiple Choice Multiple Answer
  Question 
The commonly used charts to measure the movements in price under the technical analysis are :-
  Answer 
Line Charts , Bar Charts , Point and Figure Charts
 Multiple Choice Multiple Answer
  Question 
What are the important macro economic indicators?
  Answer 
GNP growth rate , Price Conditions , Monsoons
 Select The Blank
  Question 
A security is said to be ________ if its current market price is over its intrinsic value.
  Answer 
Over priced
 Multiple Choice Single Answer
  Question 
What do you understand by the term redemption price?
  Answer 
Price or NAV at which a scheme purchases its units
 Select The Blank
  Question 
________ is due to the fact that a borrower may not pay interest and/or principal on time.
  Answer 
Default risk
 Multiple Choice Multiple Answer
  Question 
What are the features of Kisan Vikas Patra?
  Answer 
Term is for 8 years seven months , Provision of premature withdrawal , Interest rate is 8.4% compounded annually
 Multiple Choice Single Answer
  Question 
What could be a better approach to flow-of -funds analysis?
  Answer 
An examination of liquidity trends in the banking system
 True/False
  Question 
Fundamental analysis focuses on predicting the future price of a security and Technical analysis on estimating the intrinsic value of a security.
  Answer 
FALSE
 Multiple Choice Single Answer
  Question 
What is a technical approach to investment?
  Answer 
A reflection of the idea that prices move in trends which are determined by various factors
 Select The Blank
  Question 
The 8% taxable savings bonds are repayable after ________ years.
  Answer 
6
 Select The Blank
  Question 
Acid test ratio is more stringent measure of liquidity compared to the ________.
  Answer 
Current ratio
 Select The Blank
  Question 
An ________ is a series of equal payments or receipts occurring at regular intervals of time.
  Answer 
Annuity
 Select The Blank
  Question 
When a debenture is sold to the general public a ________ is appointed.
  Answer 
Trustee
 True/False
  Question 
The basic inputs of the general model are expected dividends and required rate of return on stock.
  Answer 
TRUE
 Multiple Choice Multiple Answer
  Question 
Gilt Edged Securities are :-
  Answer 
Central Govt , State Govt. , Quasi-Govt
 Multiple Choice Single Answer
  Question 
Dividend discount model is considered as the simplest model for :-
  Answer 
Valuing Equity
 True/False
  Question 
The arithmetic mean is a set of observations is calculated by finding the sum values and dividing by the number of observations.
  Answer 
TRUE
 Select The Blank
  Question 
Mutual fund is to be registered with ________ before raising funds from public.
  Answer 
SEBI
 Multiple Choice Multiple Answer
  Question 
Formula for calculation of portfolio variance requires :-
  Answer 
Expected return on portfolio , Expected return on assets , Weight of asset in the portfolio
 Multiple Choice Single Answer
  Question 
What is the minimum investment amount in G-secs?
  Answer 
1000
 Multiple Choice Multiple Answer
  Question 
Which are the different styles of displaying charts?
  Answer 
Bar and line charts , Candle stick charts , Point and figure charts
 Multiple Choice Multiple Answer
  Question 
Characteristics of Preference shares are :-
  Answer 
Carry a fixed rate of dividend , Dividend payable out of profit , Redemption in 7 to 12 years
 Select The Blank
  Question 
The ________ phase is characterized by resistance area and support level.
  Answer 
Transition
 Select The Blank
  Question 
In a heads and shoulders formation the deeper the pattern, the greater is the ________ significance once it is completed
  Answer 
Bearish
 Multiple Choice Multiple Answer
  Question 
Explain what are leverage ratios ?
  Answer 
Help in assessing the risk arising using the debt capital , Debt equity ratio and interest coverage ratio and DSCR are important leverage ratios , Debt is riskier source of finance as it entails fixed outgo of periodic payments
 True/False
  Question 
Passive investment managers believe that markets are inefficient and Active managers believe that markets are efficient.
  Answer 
FALSE
 Select The Blank
  Question 
S&P NSE 50 index is known as ________.
  Answer 
NIFTY
 Multiple Choice Single Answer
  Question 
Which of the following is a money market fund?
  Answer 
Commercial paper
 Multiple Choice Single Answer
  Question 
Capital expenditure -depreciation +change in working capital -(new debt issued - debt repaid) =
  Answer 
Equity reinvested in business
 
Note: Please tally the answers and verify them from SCDL textbooks as all answers might not be correct.
 
 

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