Derivative Question - Set 11
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1. This is a Mock Examination of NISM-Series-XVIII: Financial Education Certification Examination.
2. This mock test has 50 questions of 1 marks each. Please note that the actual examination for NISM Series XVIII: Financial Education Certification Examination has 50 questions of 1 mark each.
3. There is no negative marking.
4. The passing score for the examination is 60%
5. This mock examination is only to give the candidates an experience of NISM testing system.
6. Please note that passing this mock test would not make you eligible for claiming a certificate for NISM-Series-XVIII: Financial Education Certification Examination.
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Question 1 of 25
Vertical spread is also known as Time spread
Question 2 of 25
Option seller will be legally bound to honour the contract by settling in cash if the option buyer does not exercise.
Question 3 of 25
Securities Transaction Tax (STT) is levied on
Question 4 of 25
An investor buys 2 contracts of TCS futures for Rs. 570 each. He sells of one contract at Rs. 585. TCS futures closes the
day at Rs. 550. What is the net payment the investor has to pay / receive from his broker? 1 TCS contract = 1000 shares
Question 5 of 25
The price bands that are applicable in the derivatives segment are _____
Question 6 of 25
Reverse cash and carry arbitrage refers to long position in futures market and short position in the underlying or cash
Question 7 of 25
What is a contract size?
Question 8 of 25
The beta of TUV company is 1.3. A person has a long TUV position of Rs. 800,000 coupled with a short Nifty position of
Rs.800,000. Which of the following is TRUE?
Question 9 of 25
In equity derivatives segment, if a stock fails to meet the retention criteria for three months consecutively , then__________
Question 10 of 25
Liquid Assets maintained by Mr A (Clearing Member) are higher than that maintained by Mr B (Clearing Member). Which of
the following statements is true?
Question 11 of 25
A CALL option is quoting at a premium of Rs 25. The Strike is Rs 180 and SPOT Rs 200. The option was purchased at Rs
10. The best way to exit this option is
Question 12 of 25
Delta is _______________
Question 13 of 25
When the index future is used to hedge against the market risk on a portfolio, then it can be called as a cross hedge.
Question 14 of 25
Long hedge is the transaction when we hedge our position in futures market by going long in cash market
Question 15 of 25
The beta of ABC Company is 0.8. Assuming you have a position of Rs 10,00,000 worth of ABC shares, which of the
following gives a complete hedge?
Question 16 of 25
Derivative Contracts may be intrduced on an Index if the stocks contributing to __________weightage of the index are
individually eligible for derivative trading
Question 17 of 25
The trades done by dealers in their own account has to be totally segregated from the trades done in their clients account
– State True or False ?
Question 18 of 25
Daily settlement price of futures contracts on any trading day is ______________________
Question 19 of 25
Cash and carry arbitrage refers to a short position in the cash or underlying market and a long position in futures market
Question 20 of 25
New options contracts are introduced on the
Question 21 of 25
You have bought a portfolio of securities on the exchange. To eliminate the risk arising out of market, you should _____.
Question 22 of 25
_____________ defines the exposure limits for the branches of the firm
Question 23 of 25
Derivative is defined under SC(R)A to include : A contract which derives its value from the prices, or index of prices, of
Question 24 of 25
If a portfolio is hedged with short position in index futures, then the amount of loss made in cash market will always be
fully compensated by the profits on futures positions.
Question 25 of 25
On exercise of an option, the buyer/ holder will recognize premium as an_____________.