Bissoy.com
Doctors Medicines MCQs Q&A

Why a retail investor is recommended to invest through a mutual fund in a stock exchange?
1. Mutual funds invest funds in a diversified portfolio of securities, thus reducing the risk of the investor.
2. Mutual funds are managed by financial experts.
3. Mutual funds promise high returns to the investors of the fund.

Why a retail investor is recommended to invest through a mutual fund in a stock exchange?
1. Mutual funds invest funds in a diversified portfolio of securities, thus reducing the risk of the investor.
2. Mutual funds are managed by financial experts.
3. Mutual funds promise high returns to the investors of the fund. Correct Answer 1 and 2 only

Related Questions

Choose the correct code for the following statements being correct or incorrect. Statement I : When the two securities returns are perfectly positively correlated, the risk of their portfolio is just a weighted average of the individual risks of the securities. In such case, diversification does not provide risk reduction but only risk averaging. Statement II : Total risk of a portfolio of two risk securities can be completely eliminated when their returns are perfectly negatively correlated and their proportionate holdings in the portfolio are inversely related to the relative individual risks of the securities. 
In the following question, sentences of a paragraph have been jumbled and labeled as A, B, C, and D. You are required to rearrange the jumbled sentences of the paragraph and mark your response accordingly by selecting the correct option. A. The value of the mutual fund company depends on the performance of the securities it decides to buy. B. Investing in a share of a mutual fund is different from investing in shares of stock. C. When you buy a unit of a mutual fund, you are buying the performance of its portfolio. D. Mutual funds pool money from the investing public and use that money to buy other securities, usually stocks and bonds.
In the question below, a passage is given followed by three courses of actions numbered I, II and III. On the basis of the information given, you have to assume everything in the statement to be true, and then decide which of the following suggested courses of actions logically follow(s) for pursuing. Passage: The board of Vedanta Ltd Limited on Monday approved a proposal for delisting of the company and will seek shareholders approval for the process through e-Voting, the company informed the exchanges. The company has proposed to buy 48.9% shares at Rs 87.5 apiece whereas the book value of the company is around Rs. 141 per share. Retail investors hold 7% of the total shares whereas Institutional Investors hold 41.9% of the total shares. Minimum 90% of shareholders should approve the de-listing for it to happen. The scrip closed today at Rs.110, down 4% from the previous close. Courses of action: I. Vedanta must cajole Institutional shareholders to approve the de-listing. II. Institutional Investors must seek a better deal from the company and vote out this proposal as it is below both the market price and book value. III. Retail investors must come together and complain to the exchanges regarding the company’s attempt to force them out of their shares.
The question given below consists of a statement, followed by three arguments I, II and III. You have to decide which of the arguments is/are ‘strong’ arguments, is/are ‘weak’ arguments and accordingly choose your answer from the alternatives given below each question. Statement: Over the past five decades, term deposits in banks have emerged as the primary instrument of financial savings for the average Indian after former premier Indira Gandhi embarked on a mission to nationalise the lenders - 14 in the first tranche - on a rainy afternoon in July 1969. Coming with an unsaid sovereign guarantee of sorts, fixed deposits (FDs) seemingly offered investors liquidity - and safety - as nationalisation sought, in part, to arrest the 40-odd bank failures a year.  Now, however, deposits must burnish their allure to retain leadership status in an increasingly crowded financial marketplace that offers choice. Why? Arguments: I. If FDs are giving 7.5% and the effective tax rate is 10%, one gets close to 5-5.2% return. Similarly, in the case of FMP, if the rate is 7.5%, effective taxation comes to 10%, one gets 6.75%. It is higher than the effective returns on bank deposits.  II. People are becoming aware of more asset classes that offer better returns, and the quest for such assets became more pronounced after interest rates fell substantially over the past four years.  III. Savers are looking at mutual funds and provident funds for the higher return. 
Which of the following are the different functions that are performed by the financial markets?
1. Determination of the prices where financial markets help in price discovery of various financial instruments.
2. Mobilization of the funds
3. Providing an opportunity to different investors to buy or sell their respective financial instrument at the fair value that is prevailing in market.
4. Providing the various types of information to traders that help in decision making.
5. The sharing of the risk with investors.
With reference to the National Invest­ment Fund to which the disinvestment proceeds are routed, consider the following statements : 1. The assets in the National Invest­ment Fund are managed by the Union Ministry of Finance. 2. The National Investment Fund is to be maintained within the Consoli­dated Fund of India. 3. Certain Asset Management Com­panies are appointed as fund managers. 4. A certain proportion of annual income is used for financing select social sectors. Which of the statements given above is/are correct?
Arrange the steps for building a portfolio for your teaching area from beginning to last step order  (A) Decide who will plan the portfolio  (B) Decide on the purpose of a portfolio  (C) Decide which products and how many samples to put in the portfolio  (D) Identify cognitive skills and dispositions  (E) Build the portfolio rubrics  Choose the correct answer from the options given below : 
What is a mutual fund?
1. A type of collective investment scheme that pools money from many investors and invests it in stocks, bonds or other money market instruments.
2. It is a subsidiary of a bank or financial company created specially to raise money to be invested in a particular industry such as housing, infrastructure, etc.
3. When several banks and financial companies come together and create a common pool of money to fund mega infrastructural project like bridges, roads, power plants, etc., the common pool is known as mutual fund.
Risk on a stock portfolio which cannot be eliminated or reduced by placing it in diversified portfolio is classified as
Risk on a stock portfolio which can be reduced by placing it in diversified portfolio is classified as