Mutual Funds Management-1


SKU: AMSEQ-188 Category:



Q.1 Describe the structure of Mutual Funds.

Q.2 Write down the advantages of investing through a mutual fund.

Q.3 Write a note on ‘Load structure’.

Q.4 Discuss rights of an investors in mutual fund.

Q.5 What do you mean by Net Asset Value (NA V)? Discuss how to calculate NAV of a fund.





Q.1 Discuss the Role of an Offer Document.

Q.2 Discuss various distribution channels through which mutual fund schemes reach the investors.

Q.3 What do you mean by portfolio management? Develop a model portfolio for a young call centre / BPO employee with no dependents.




mutual fund amity assignments
Justify the each phases of mutual fund history








1. Mutual Fund agents/distributors are not allowed to sell Financial Products other than Mutual Funds

a. True

b. False


2. Dividends distributed by mutual funds are

a. Taxed at source

b. Taxed in the hands of the investors

c. Are subject to capital gains tax

d. Are tax-free in the hands of the investor
3. Which of the following is not a characteristic of company fixed deposits

a. A higher rate of interest

b. higher risk

c. unfavourable effect of tax

d. very high liquidity


4. An equity oriented scheme has at least ______% of assets in equity.

  1. 85
  2. 80
  3. 65
  4. 60


5. Liquid funds have more than ____% invested in instruments with maturities of less than one year

  1. 100
  2. 90
  3. 95
  4. 98


6. The _______ are responsible for protecting the interest of the investors in the mutual fund.

a. Sponsors

b. Trustees

c. Fund Managers

d. Custodians


7. At least _______ of the trustees must be independent of the sponsor.

  1. 2/3rd
  2. 1/3rd
  3. ½
  4. All


8. The functioning of the AMC is overseen by the _______.

a. Sponsors

b. Trustees

c. Fund Managers

d. Custodians


9. An AMC must have a minimum net worth of __________ at all times.

a. Rs 10 Crores

b. Rs 100 Crores

c. Rs 1000 Crores

d. Rs 25 Crores


10. The Apex regulator of the securities markets is ________.


b. RBI

c. RTA



11. ________ insists on the registration of market participants under the specific regulations.


b. RBI

c. RTA



12. The securities that a fund invests in depend upon its ________.

a. AMC

b. Corpus

c. Fund Manager

d. Investment objective


13. Marking to market is the process of valuing the security at ______.

a. Book value

b. Market value

c. Face value

d. Net value


14. The type of expenses that can be charged to a fund and the limit is decided by _______.


b. RBI

c. RTA



15. A mutual fund cannot have ________ liabilities on its balance sheet.

  1. Long Term
  2. Short Term
  3. Contingent
  4. Current


16. Mutual funds have lower risks because of ________ & _______.

a. Diversification & Professional management

b. Large no. of investors, AMFI regulations

c. AMFI regulations, Professional management

d. Custodian, Professional management


17. All investments of Rs _______ and above need to comply with KYC Documentation

  1. 1,00,000
  2. 5,00,000
  3. 10,000
  4. 50,000


18. An investor’s holding in a mutual fund is denoted in _________.

  2. Bonds
  3. Units
  4. Debentures


19. The value of the unit goes up or down depending on the ______________ .

  1. Underlying securities
  2. Sensex
  3. Nifty
  4. Inflation


20. The AUM of the fund is the market value of its portfolio. This less the fund raising expenses and _________ of the fund is the Net Assets of the fund.

  1. Long Term
  2. Short Term
  3. Contingent
  4. Current


21. The expenses are charged to the fund on a ______ basis.

  1. Daily
  2. Monthly
  3. Yearly
  4. Quarterly


22. The NAV of a mutual fund:

  1. is always constant
  2. keeps going up at a steady rate
  3. fluctuates with market price movements
  4. cannot go down at all


23. An open-ended mutual fund is one that has:

a. an option to invest in any kind of security

b. units available for sale and repurchase at all times

c. an upper limit on its NAV

d. a fixed fund size
24. An investor in a close-ended mutual fund can get his/her money back by selling his/her units:

a. back to the fund

b. to a special trust at NAV

c. on a stock exchange where the fund is listed

d. to the agent through which he/she subscribed to the units of the fund
25. The “load” charged to an investor in a mutual fund is

a. entry fee

b. cost of the paper on which the unit certificates are printed

c. the fee the agent charges to the investor

d. the expenses incurred by fund managers for marketing a mutual fund scheme
26. Units from an open-ended mutual fund are bought

a. on a stock exchange

b. from the fund itself

c. from AMFI

d. from a stock broker
27. “Load” cannot be recovered

a. from the investor

b. as a fixed amount each year

c. at the time the investor exits the fund

d. from the fund’s distribution agent
28. The most important advantage of a money market mutual fund is

a. quick capital appreciation

b. high regular income

c. safety of principal

d. no loads
29. Some close-ended funds are quoted at a discount to their NAV because

a. of high expense ratios

b. investors do not expect the current NAV to be sustained in future

c. the repurchase price fixed by the fund in lower than the NAV

d. of the inherent risk involved in investing in such type of funds


30 The greatest potential for growth in capital is offered by

a. debt funds

b. gilt funds

c. growth funds

d. balanced funds
31. A Systematic Withdrawal Plan, allows investors to get back the principal amounts invested in addition to the income on investment

a. True

b. False
32. Constraints imposed by most funds on check writing are:

a. Account balance should not fall below the minimum capital required

b. Checks issued must be for at least the minimum amount specified

c. Number of checks per month must not exceed a specified number

d. Both a & b above
33. The performance of a fund is largely measured by the success of

a. the marketing function

b. the operations function

c. the portfolio market function

d. none of the above
34. Generally invest in

a. unlisted

b. market-traded

c. thinly traded

d. privately placed
35. Which of the following is not an equity instrument

a. preference shares

b. equity warrants

c. ordinary debentures

d. convertible debentures
36. The drawback of an ordinary share is

A. possibility of capital appreciation

B. ownership privilege of the company

C. guaranteed dividend income

D. no guaranteed income or security


37. The amount of authority enjoyed by a self-regulatory organisation is defined by

1. The apex regulatory authority

2. AMC

3. Its own members

4. RBI
38. The role of AMFI in the mutual funds industry is not to

a. Promote the interests of the unit holders

b. Set a Code of Ethics

c. Regulate mutual funds

d. Increase public awareness of mutual funds in the country
39. The rights of investors in a mutual fund scheme are laid down in

a. the Offer Document of that scheme

b. Quarterly Reports

c. Annual Reports

d. marketing brochures
40. After dividend declaration, unit-holders are entitled to receive dividend within

a. one week

b. one month

c. 42 days

d. six weeks