Tag: sebi

Questions Related to sebi

Expense ratio is the fee for managing fund.

  1. True

  2. False


Correct Option: A
Explanation:

Expense ratio is the fee for managing fund- this is a true statement. Expense ratio can be defined as a ratio which indicates how much the fund charges in terms of percentage annually  in order to manage the investor's total investment portfolio. Expanse ratio covers various types of cost and it is disclosed to investors once in a 6-months.

NSE is managed by professionals, who do not directly or indirectly trade on the exchange.

  1. True

  2. False


Correct Option: A
Explanation:

NSE is managed by professionals, who do not directly or indirectly trade on the exchange- this is a true statement. Meeting international benchmarks and standards is one of the objectives of NSE. NSE ensures equal access for investors all over the country with the help of appropriate communication network. The NSE was established by financial institutions, insurance companies and banks. In NSE, the trading rights are with the trading members who offer their services to the investors. NSE launched the capital market segment in November 1994. NSE launched the futures and options segment in June 2000 for various derivative instruments.

NSE launched the futures and options segment in ____ for various derivative instruments.

  1. June 2000

  2. June 2001

  3. June 2010

  4. June 2005


Correct Option: A
Explanation:

NSE launched the futures and options segment in June 2000 for various derivative instruments. In NSE, the trading rights are with the trading members who offer their services to the investors. NSE is managed by professionals, who do not directly or indirectly trade on the exchange- this is a true statement. Meeting international benchmarks and standards is one of the objectives of NSE. NSE ensures equal access for investors all over the country with the help of appropriate communication network. The NSE was established by financial institutions, insurance companies and banks. NSE launched the capital market segment in November 1994.

Participants of OTC include _____.

  1. Investors

  2. Companies which list their shares on OTCEI

  3. Settlement bank

  4. All of the above


Correct Option: D
Explanation:

Participants of OTC include: investors, companies which list their shares on OTCEI and settlement bank. OTC was set up to provide small and medium companies an access to capital market for raising finance.  OCTCEI is advantageous to the company because it provides methods of raising funds through capital market instruments which are priced fairly.

OTC Exchange of India was incorporated in ____.

  1. 1990

  2. 1991

  3. 1992

  4. 1993


Correct Option: A
Explanation:

OTC Exchange of India was incorporated in 1990. OTCEI was set up to provide small and medium companies an access to capital market for raising finance.  OCTCEI is advantageous to the company because it provides methods of raising funds through capital market instruments which are priced fairly.

The OTC Exchange will not list and trade in companies listed on any other exchange.

  1. True

  2. False


Correct Option: A
Explanation:

The OTC Exchange will not list and trade in companies listed on any other exchange- this is a true statement. OTC Exchange of India was incorporated in 1990. OTCEI was set up to provide small and medium companies an access to capital market for raising finance.  OCTCEI is advantageous to the company because it provides methods of raising funds through capital market instruments which are priced fairly.

A simple way to make a diversified investment is investing in _______.

  1. Stocks

  2. Shares

  3. Mutual Funds

  4. Derivatives


Correct Option: C
Explanation:

A simple way to make a diversified investment in investing in mutual funds. Mutual fund is a collective investment that pools together the money of a large number of investors to purchase a number of securities, like stocks, bonds, etc. Investors can sell their mutual funds whenever they want.

______ is a collective investment that pools together the money of a large number of investors to purchase a number of securities like stocks, bonds etc.

  1. Mutual Fund

  2. Portfolio

  3. Shares

  4. Stock


Correct Option: A
Explanation:

Mutual fund is a collective investment that pools together the money of a large number of investors to purchase a number of securities, like stocks, bonds, etc. Investors can sell their mutual funds whenever they want. A simple way to make a diversified investment in investing in mutual funds.

Which of the following is/are the demerits of OTCEI?

  1. Poor liquidity of Scrips

  2. Delay in Settlement

  3. Lack of Transparency

  4. All of the above


Correct Option: D
Explanation:

The OTCEI is a company incorporated under the Companies Act 1956. OTCEI was set up to provide small and medium companies an access to capital market for raising finance.  OCTCEI is advantageous to the company because it provides methods of raising funds through capital market instruments which are priced fairly. Following are the demerits of OTCEI:A) Poor liquidity of ScripsB) Delay in Settlement

C) Lack of Transparency.

Identify the promoter(s) of OTCEI from the following.

  1. SBI Capital Markets Ltd.

  2. IFCI

  3. IDBI

  4. All of the above


Correct Option: D
Explanation:
Promoter of OTCEI are :-a) SBI Capital Markets Ltd.
b) IFCI
c) IDBI
The OTCEI is a company incorporated under the Companies Act 1956. OTCEI was set up to provide small and medium companies an access to capital market for raising finance.  OCTCEI is advantageous to the company because it provides methods of raising funds through capital market instruments which are priced fairly.