Derivative Question - Set 3
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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
ABC is currently at 5100. An investor feels ABC company will not go beyond 5300 in next three months. He sells two lots of
5100 strike call on ABC company for Rs. 200 a lot. Because of good industrial production data, ABC company rallies to 5200 on
the option’s expiry day. What is the Profit/ Loss to the investor? (1 lot = 50 shares)
Question 2 of 25
A stock is currently selling at Rs 70.the call otpion to buy the stock at Rs 65 costs 9. what is the time value of the option?
Question 3 of 25
What role do speculators play in the futures market?
Question 4 of 25
____________is required to be paid on assigned positions of Clearing Members towards final exercise settlement
obligations for stock option contracts
Question 5 of 25
What is the outstanding position on which initial margin will be levied if no proprietary trading is done and the details of
client trading are: one client buys 200 units @ 1260. The second client buys 900 units @Rs.1255 and sells 1650 units
@Rs.1260 of the same company?
Question 6 of 25
A calendar spread becomes a naked or open position, when the near month contract expires or either of the legs of spread
Question 7 of 25
The ratio of change in delta for a unit change in the price of underlying is called ________ .
Question 8 of 25
In case of open position of any NRI exceeding the specified limit , the penalty charged on the clearing member for each day
of violation would be
Question 9 of 25
If you sell a put option with strike of Rs. 245 at a premium of Rs.40, how much is the maximum gain that you may have on
expiry of this position?
Question 10 of 25
If an investor buys a call option with lower strike price and sells another call option with higher strike price, both on the
same underlying share and same expiration date, the strategy is called _______________.
Question 11 of 25
Daily settlement price of futures contracts on expiry day is ______________________
Question 12 of 25
An index put option at a strike of Rs 11200 is selling at a premium of Rs 50 At what index level will it break even for the
buyer of the option
Question 13 of 25
A Speculator with a bullish view on a security can _____________
Question 14 of 25
An index option is a __________________.
Question 15 of 25
Mr.X purchases 100 Put Option on Stock S at Rs 30 Per Call with Strike Price of Rs 280. If on Exercise date, Stock Price is
Rs 350, ignoring transaction cost, Mr.X will choose
Question 16 of 25
The time value of an option is
Question 17 of 25
Which of the following statement is TRUE about time value of options?
Question 18 of 25
On exercise, the _________ gives its holder a positive cash flow.
Question 19 of 25
Its possible to draw the payoff charts for Time spreads
Question 20 of 25
Beta of the portfolio is influenced the most by the beta value of scrip having the highest weightage in that portfolio
Question 21 of 25
Order lying unmatched in the system is called _____________
Question 22 of 25
Price of an option expiring three months from today will be higher than price of an option expiring in two months from
Question 23 of 25
Total price risk in investment in securities is the sum of systematic risk or market risk and unsystematic risk or specific
Question 24 of 25
For market stability, only hedgers are required. Traders are not required.
Question 25 of 25
A Put Option: