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Questions and Answers
What is a portfolio in the context of securities?
What is a portfolio in the context of securities?
- A type of investment strategy
- A single security
- A type of financial plan
- A collection of multiple securities (correct)
What is the primary function of asset management companies?
What is the primary function of asset management companies?
- To define the goals for investors to save money
- To regulate the activities of the banking system
- To offer advisory services to investors
- To create and manage a portfolio of securities (correct)
What is the role of investment advisers and distributors?
What is the role of investment advisers and distributors?
- To create and manage a portfolio of securities
- To regulate the activities of the banking system
- To help investors make a choice of securities based on their needs (correct)
- To define the goals for investors to save money
What is the primary difference between asset management companies and portfolio managers?
What is the primary difference between asset management companies and portfolio managers?
Which ministry regulates the capital markets and its participants?
Which ministry regulates the capital markets and its participants?
What is the primary regulation that defines the setting up of companies?
What is the primary regulation that defines the setting up of companies?
What is the role of the Ministry of Corporate Affairs?
What is the role of the Ministry of Corporate Affairs?
Who initiates discussions on reforms and oversees the implementation of law?
Who initiates discussions on reforms and oversees the implementation of law?
What is the primary role of the secondary market?
What is the primary role of the secondary market?
What is the primary function of a Mutual Fund?
What is the primary function of a Mutual Fund?
What is the main aim of the regulators of financial markets?
What is the main aim of the regulators of financial markets?
What is the purpose of the primary market?
What is the purpose of the primary market?
What is the primary function of the money markets in the Indian financial market?
What is the primary function of the money markets in the Indian financial market?
What is the term for the process of investing a fixed amount of money at regular intervals, regardless of the market's performance?
What is the term for the process of investing a fixed amount of money at regular intervals, regardless of the market's performance?
Which of the following market participants provides liquidity and stability in the financial markets?
Which of the following market participants provides liquidity and stability in the financial markets?
What is the main benefit of investing in Mutual Funds?
What is the main benefit of investing in Mutual Funds?
What is the role of banks and financial institutions in the financial markets?
What is the role of banks and financial institutions in the financial markets?
What is the term for the entities that participate in the financial markets, such as investors, brokers, and regulators?
What is the term for the entities that participate in the financial markets, such as investors, brokers, and regulators?
Who is the licensing authority for insurance companies?
Who is the licensing authority for insurance companies?
In which market do securities are issued by the borrowing institutions directly to the lenders or investors?
In which market do securities are issued by the borrowing institutions directly to the lenders or investors?
What is the primary function of the primary market?
What is the primary function of the primary market?
What is the role of fund managers and financial advisors in the financial markets?
What is the role of fund managers and financial advisors in the financial markets?
What is the main objective of investors in the securities market?
What is the main objective of investors in the securities market?
What is the key difference between retail investors and institutional investors?
What is the key difference between retail investors and institutional investors?
What do the commodities markets and foreign exchange markets support?
What do the commodities markets and foreign exchange markets support?
Who is the authority appointed under the Companies Act to register companies and ensure compliance with the law?
Who is the authority appointed under the Companies Act to register companies and ensure compliance with the law?
Who are the primary participants in the securities market?
Who are the primary participants in the securities market?
What is the website to visit for registration and examination details for the NISM-Series-X-A: Investment Adviser (Level 1) Certification Examination?
What is the website to visit for registration and examination details for the NISM-Series-X-A: Investment Adviser (Level 1) Certification Examination?
What determines the type of securities issued by an issuer?
What determines the type of securities issued by an issuer?
What is the purpose of regulatory control and supervision in the securities market?
What is the purpose of regulatory control and supervision in the securities market?
What characterizes institutional investors?
What characterizes institutional investors?
Who regulates the Indian banking system and conducts monetary, forex and credit policies?
Who regulates the Indian banking system and conducts monetary, forex and credit policies?
Who is responsible for designing the structure of funds and constituents in the National Pension System (NPS)?
Who is responsible for designing the structure of funds and constituents in the National Pension System (NPS)?
What is the primary function of the Securities and Exchange Board of India (SEBI)?
What is the primary function of the Securities and Exchange Board of India (SEBI)?
What is the role of institutions such as mutual funds, insurance companies, and pension funds in the proper pricing of financial assets?
What is the role of institutions such as mutual funds, insurance companies, and pension funds in the proper pricing of financial assets?
What is the primary function of the securities or capital markets in the Indian financial market?
What is the primary function of the securities or capital markets in the Indian financial market?
What is the role of financial intermediaries in the securities market?
What is the role of financial intermediaries in the securities market?
Who regulates the futures and forward trading in commodities in India?
Who regulates the futures and forward trading in commodities in India?
What is the role of investment advisers and distributors?
What is the role of investment advisers and distributors?
Who oversees the activities of the banking system, insurance, and pension sectors?
Who oversees the activities of the banking system, insurance, and pension sectors?
Study Notes
Registration and Examination
- To find out more and register for the NISM-Series-X-A: Investment Adviser (Level 1) Certification Examination, visit www.nism.ac.in.
Indian Financial Markets
- The Indian financial market consists of the money markets and securities or capital markets.
- The money markets deal with short-term lending and borrowing of funds.
- The securities or capital markets enable longer-term transfer of funds using debt and equity instruments.
Structure of Financial Markets in India
- The financial market structure consists of the primary markets where securities are issued by borrowing institutions directly to lenders or investors.
- The secondary markets provide investors with options to exit or reallocate their resources by dealing amongst themselves.
Participants in Financial Markets
- Market participants include banks, financial institutions, brokers, dealers, custodians, depositories, and depository participants.
- Institutional investors, such as mutual funds, insurance companies, and pension funds, provide funds in the markets and provide liquidity and stability.
Regulatory Framework
- Regulators of financial markets include the Ministry of Finance, Ministry of Corporate Affairs, Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority (IRDA), and Pension Fund Regulatory and Development Authority (PFRDA).
- The Ministry of Finance regulates the banking system, insurance, and pension sectors.
- The Ministry of Corporate Affairs regulates the functioning of the corporate sector.
- The RBI regulates the money market segment of the securities market and manages the government's borrowing program.
- The SEBI is the chief regulator of securities markets in India.
Mutual Funds
- A mutual fund is a type of investment vehicle that pools money from various investors to invest in a diversified portfolio of securities.
- Mutual funds are regulated by SEBI.
- Mutual fund products include equity, debt, and hybrid funds.
Investment Products
- Investment products include mutual funds, insurance products, and pension funds.
- Investment advisers and distributors work with investors to help them make a choice of securities based on their needs, time horizon, return expectation, and ability to bear risk.
Regulatory Control and Supervision
- The entire process of issuance, subscription, and transaction in securities is subject to regulatory control and supervision.
- Regulators ensure that the interests of investors are protected.
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Description
This quiz covers the basics of the Indian financial market, including the money markets and securities or capital markets, as well as the registration process for the NISM-Series-X-A Certification Examination.
