NISM Series X-A Investment Adviser Level 1 Quiz

<p>Efficiently planning liabilities and expenses (C)</p> Signup and view all the answers

<p>They typically involve high-interest costs (C)</p> Signup and view all the answers

<p>Life insurance (B)</p> Signup and view all the answers

<p>To understand one's financial position clearly (C)</p> Signup and view all the answers

<p>Higher overall debt levels (A)</p> Signup and view all the answers

<p>To assist individuals with financial goal setting and asset allocation. (A)</p> Signup and view all the answers

<p>Advising on a specific stock purchase. (A)</p> Signup and view all the answers

<p>Asset allocation and market performance. (C)</p> Signup and view all the answers

<p>They lack sufficient time or expertise to manage their finances effectively. (A)</p> Signup and view all the answers

<p>It involves a comprehensive approach to all aspects of personal finance. (D)</p> Signup and view all the answers

<p>Balancing investments across different asset classes based on risk and return. (B)</p> Signup and view all the answers

<p>To navigate the complexities of various financial products and make informed comparisons. (C)</p> Signup and view all the answers

<p>Establishing a strategic map for managing personal finances, including all relevant areas. (A)</p> Signup and view all the answers

<p>It can affect the post-tax return and future financial goals. (D)</p> Signup and view all the answers

<p>Understanding time value of money and inflation is essential. (B)</p> Signup and view all the answers

<p>The risk tolerance and long-term nature suitable for retirement. (B)</p> Signup and view all the answers

<p>Shift focus toward less volatile assets. (D)</p> Signup and view all the answers

<p>Accumulated returns can present varying tax implications. (D)</p> Signup and view all the answers

<p>Ensuring adequacy of income from investments and pensions. (A)</p> Signup and view all the answers

<p>It is irrelevant for individuals without significant wealth. (A)</p> Signup and view all the answers

<p>Because needs change throughout retirement. (A)</p> Signup and view all the answers

<p>To enhance education quality and standards in financial services (C)</p> Signup and view all the answers

<p>Equities, Mutual Funds, and Derivatives (B)</p> Signup and view all the answers

<p>High-end professional education and research (D)</p> Signup and view all the answers

<p>2023 (B)</p> Signup and view all the answers

<p>A diverse range of market functions (D)</p> Signup and view all the answers

<p>As a provider of structured learning plans and career paths (D)</p> Signup and view all the answers

<p>Capacity building through professional education (B)</p> Signup and view all the answers

<p>Patalganga Industrial Area (D)</p> Signup and view all the answers

<p>Increased sales of undesirable products (B)</p> Signup and view all the answers

<p>They earn income solely from fees paid by clients. (C)</p> Signup and view all the answers

<p>They should not earn any income from the producer. (B)</p> Signup and view all the answers

<p>Commission-based fee from product sales (B)</p> Signup and view all the answers

<p>Client needs may be overlooked. (C)</p> Signup and view all the answers

<p>Advisers may offer incidental advice related to products. (A)</p> Signup and view all the answers

<p>Fee-only financial planning model (C)</p> Signup and view all the answers

<p>Increased likelihood of selling unsuitable products (B)</p> Signup and view all the answers

<p>Rs.734,664 (D)</p> Signup and view all the answers

<p>Rs.234,664 (A)</p> Signup and view all the answers

<p>It increases the interest income. (B)</p> Signup and view all the answers

<p>Rs.7346.64 (B)</p> Signup and view all the answers

<p>It represents the annualized rate of return over a certain period. (A)</p> Signup and view all the answers

<p>The percentage rate that is earned on a particular investment. (A)</p> Signup and view all the answers

<p>PV(1+r)^n = FV (A)</p> Signup and view all the answers

<p>It allows interest to earn additional interest. (C)</p> Signup and view all the answers

A certification program by the National Institute of Securities Markets (NISM) to enhance quality and standards of financial professionals.

A category of financial professional certification by NISM focusing on fundamental investment knowledge.

The specific series/code for the Investment Adviser (Level 1) certification.

The system where financial instruments like stocks, bonds and funds are traded or exchanged.

Formal training and learning to develop skilled financial professionals or market players

Developing skills and knowledge of stakeholders in the financial markets.

Assessments to gauge knowledge and skills of professionals in various financial segments.

Ongoing training programs for professionals to maintain and enhance skills in financial markets.

Involves understanding income, expenses, future goals, assets, and liabilities to effectively manage personal finances.

Experts who help individuals manage their finances, focusing on goals, asset allocation, and financial products.

Specific objectives individuals aim for regarding their money, such as retirement or buying a home.

The act of strategically assigning money to different asset classes (like stocks or bonds) to meet financial objectives.

Financial instruments, like stocks, bonds, or mutual funds, used to grow capital.

A systematic approach considering all financial needs (retirement, insurances) of an individual.

Financial planning is a holistic approach addressing all financial needs; financial advisory usually focuses on a specific area (stocks, debt).

Continuously adjusting to changing market conditions and client needs for optimal results.

A situation where someone spends less than they earn but still struggles to meet their financial obligations due to uneven income and expenses.

A detailed plan outlining all income and expenses, helping individuals control their finances.

A risk-transfer mechanism where a small payment (premium) protects against financial losses from unexpected events.

The process of planning and handling financial liabilities effectively.

A professional who helps individuals plan and manage their investments and liabilities.

A type of insurance that provides financial protection to beneficiaries in case of the policyholder's death.

Provides financial protection against medical expenses incurred due to illness or accidents.

Covers financial losses from damage or theft of property and other valuables.

A situation where a financial advisor's personal gain (e.g., higher commission) may influence their recommendations, potentially harming the client's interests.

Selling a financial product that is not suitable for the client's needs or risk profile, potentially leading to financial loss for the client.

A financial advisor who earns income solely from client fees, not commissions from selling financial products.

Various ways fee-only planners charge clients, including one-time planning fees, ongoing review fees, asset-based fees, and referral fees for specific services.

A fee-only planner primarily advises clients on their financial planning needs, without executing transactions or selling products for commissions.

In India, financial advisors offering advice for a fee must be registered with SEBI and are prohibited from earning commissions from product producers.

Some exceptions exist for those offering financial advice as part of selling a product (e.g., insurance agent offering investment advice).

Distributors sell financial products and earn commissions from producers, while advisors provide advice and earn fees from clients.

The effect where interest earned on an investment is re-invested and earns further interest, leading to exponential growth.

How often interest is calculated and added to the principal, impacting the final return.

The total amount received at the end of an investment period, including principal and accumulated interest.

A function in Excel used to calculate the future value of an investment, considering interest rate, time period, and payments.

The percentage gain or loss on an investment, expressed as a percentage of the initial investment.

The constant rate of growth that would equate the initial value of an investment to its final value over a specific period.

The concept that money received today is worth more than the same amount received in the future due to its potential to earn interest.

Money received by an investor from an investment, such as interest payments or dividends.

Analyzing how taxes impact your income, investments, and saving for future goals. It helps you make smart financial decisions to maximize your returns after taxes.

The actual return on your investment after all taxes are paid. It's the real amount you get to keep.

Creating a financial strategy for your life after you stop working, ensuring you have enough money to live comfortably.

The effect where interest earned on an investment is reinvested and earns even more interest over time, steadily increasing your wealth.

Adjusting your investment portfolio as retirement nears, shifting to less risky assets to protect your savings.

Making plans for how your wealth will be distributed after your death, ensuring it goes to your loved ones.

Regularly reviewing your investments in retirement to ensure they still meet your needs and adjusting them as your expenses change.