Question Bank for NCFM Test, NISM Exam & BSE Exam

Explanation:

Gilt funds invest in Central and State Government securities.

Since they are Government backed bonds they give a secured return and also ensure safety of the principal amount. They are best suited for investors who are averse to risk.

Explanation:

The company and merchant banker decide the IPO price.

They are however required to give full disclosures of the parameters which they had considered while deciding the issue price.

Explanation:

NSE Nifty consists of 50 bluechip stocks.

Explanation:

Due to non-delivery of securities by the trading member on the pay-in day, the securities are put up for auction by the Exchange.

This ensures that the buying trading member receives the securities. The Exchange purchases the requisite quantity in auction market and gives them to the buying trading member.

Explanation:

NSE CNX Nifty (Nifty), is a scientifically developed, 50 stock index, reflecting accurately the market movement of the Indian markets.

Explanation:

Inflation is the rate at which the cost of living increases.

The aim of investments should be to provide a return above the inflation rate to ensure that the investment does not decrease in value.

For example, if the annual inflation rate is 7%, then the investment will need to earn more than 7% to ensure it increases in value.

Explanation:

There are two prices for a stock - BID and ASK price.

The Bid price is the buyers price and Ask is the sellers price.

For eg- Price of Reliance is Rs. 1000 - 1001 - Then 1000 is the Bid (Buyers) price and 1001 is the Ask (Sellers) price.

Explanation:

A credit rating is an evaluation of the credit worthiness of a company etc.

Instruments with AAA rating are considered to have the highest degree of safety regarding timely servicing of financial obligations. Such instruments carry lowest credit risk.