Government Securities Market in India – A Primer: Understanding Bonds
10 Questions
0 Views

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What type of instrument is a bond?

  • Equity instrument
  • Hybrid instrument
  • Derivative instrument
  • Debt instrument (correct)
  • Who are the owners of bonds considered to be?

  • Shareholders
  • Lenders
  • Lessees
  • Debt holders (correct)
  • What distinguishes Government Securities (G-Secs) from Treasury Bills (T-bills)?

  • Risk level
  • Maturity period (correct)
  • Interest rate
  • Issuer
  • Which government entity issues both treasury bills and bonds in India?

    <p>Central Government only</p> Signup and view all the answers

    What is the primary characteristic of Government Securities (G-Secs) that makes them attractive to investors?

    <p>Practically no risk of default</p> Signup and view all the answers

    What is the main difference between Treasury bills and Dated G-Secs?

    <p>Treasury bills are issued at a discount and redeemed at face value, while Dated G-Secs pay interest on face value.</p> Signup and view all the answers

    What does the term 'zero coupon securities' mean in the context of Treasury bills?

    <p>It means that Treasury bills do not pay interest but are issued at a discount.</p> Signup and view all the answers

    What was the purpose of introducing Cash Management Bills (CMBs) by the Government of India in consultation with RBI?

    <p>To address temporary mismatches in the cash flow of the Government of India.</p> Signup and view all the answers

    What does a typical nomenclature of a dated fixed coupon G-Sec represent?

    <p>Coupon rate, name of issuer, maturity year</p> Signup and view all the answers

    Why are unique ISIN numbers assigned to each security at the time of issuance?

    <p>To avoid any misunderstanding among traders regarding the issuer.</p> Signup and view all the answers

    More Like This

    Government Bonds and Securities
    38 questions

    Government Bonds and Securities

    AgreeableRetinalite8115 avatar
    AgreeableRetinalite8115
    Understanding Markets and Securities
    16 questions
    Use Quizgecko on...
    Browser
    Browser