Explanation:

The activities of a mutual fund, including collecting money from investors, creating, and managing the portfolio, are subject to SEBI (Securities and Exchange Board of India) regulations. SEBI regulates and oversees the functioning of mutual funds in India to ensure investor protection, transparency, and fair practices in the capital markets. The other options—Mutual funds, RBI (Reserve Bank of India), and Stock exchange—are not the primary regulatory entities governing the activities of mutual funds.

Explanation:

Spread and impact costs are expenses that arise due to market imperfections or a lack of liquidity. These costs encompass the difference between the bid and ask prices (spread) and the impact on the price caused by executing a large trade in a market with limited liquidity.

Explanation:

The issue process, intermediaries involved, disclosure norms, and every step of the primary issue process are subject to regulatory supervision. This implies that regulatory authorities oversee and enforce rules and guidelines to ensure fair, transparent, and compliant practices in the primary issuance of securities.

Explanation:

Optionally Convertible Debentures (OCD) are securities that can be converted into equity shares at the discretion of the debenture holders. Unlike Fully Convertible Debentures (FCD), which must be compulsorily converted into equity shares, OCD gives debenture holders the choice to convert or retain their debentures as debt. Partly Convertible Debentures (PCD) involve partial conversion, and Convertible Debentures (CD) is a general term for debentures with conversion features.

Explanation:

Market valuation benefits issuers when they need to raise further capital from the market by providing an indication of the price at which new capital could be issued. It involves assessing the market’s perception of the company’s value, which aids in determining the potential pricing for new capital issuance.

Explanation:

Investors in differential voting rights generally enjoy a higher rate of dividend. This is because differential voting rights shares often grant fewer voting rights to shareholders, and in return, companies may offer a higher rate of dividend to compensate for the reduced influence on corporate decision-making.

Explanation:

The secondary market is also called both the stock exchange (option a) and the securities exchange (option b). These terms are often used interchangeably to refer to the marketplace where existing securities, previously issued in the primary market, are bought and sold among investors.

Explanation:

Derivatives are financial instruments whose value is derived from the value of an underlying asset or reference rate. They can be based on various types of underlying assets, including debt instruments, shares, loans, and other financial instruments.

Explanation:

R-WAP is only an additional option and not a replacement for the ASBA (Application Supported by Blocked Amount) process. ASBA is a process that allows investors to apply for shares in IPOs without the need for funds to be blocked in their bank accounts. R-WAP is an alternative portal for applying in public issues, providing investors with an additional option for the application process.

Explanation:

Commodities can be classified into different categories such as soft commodities, bullion & base metals, and energy. All these categories collectively encompass a wide range of tangible goods and raw materials traded in commodity markets. The correct answer is option d) All the above.

Explanation:

Real estate mutual funds are closed-end funds that have to be listed on a stock exchange. These funds pool money from investors to invest in real estate assets and must be traded on a stock exchange.

Explanation:

An open-ended equity scheme predominantly investing in mid-cap stocks is known as a Mid Cap Fund. This type of fund focuses on investing in companies with mid-sized market capitalization, offering investors exposure to the potential growth of mid-cap companies.

Explanation:

The price of the futures contract moves based on trades, just as it does in the cash or spot market for stocks. Futures contracts derive their value from the underlying assets, and their prices are determined by market demand and supply dynamics, reflecting the real-time trading activity in the market.

Explanation:

The securities market provides a regulated institutional framework for an efficient flow of capital from investors to businesses in the financial market system. This market includes various segments such as the stock market, where securities like stocks and bonds are bought and sold, ensuring a structured environment for capital allocation.

Explanation:

The funds and investments of the mutual fund are held in a trust of which the investors alone are the joint beneficial owners. Investors in the mutual fund collectively own the assets held in the trust, and the trustees are responsible for managing and safeguarding these assets on behalf of the investors. Mutual funds and depositories are not the joint beneficial owners but represent entities involved in the administration and functioning of the mutual fund structure.

Explanation:

Equity markets have a higher level of retail investor participation. Retail investors refer to individual investors who participate in the financial markets with smaller investment amounts compared to institutional investors. The terms traditional and individual can also be associated with retail investors, but retail specifically emphasizes participation by individuals in the broader public.

Explanation:

Long-term capital can be raised by issuing both equity and debt securities. Equity represents ownership in a company, and issuing equity involves selling shares to investors. Debt securities, on the other hand, involve borrowing money through instruments like bonds.

Explanation:

The Clearing Corporation is comprised of NSE Clearing Ltd. Indian Clearing Corporation Ltd. (ICCL), and Metropolitan Clearing Corporation of India Ltd. (MCCIL). These entities are integral parts of the clearing and settlement infrastructure in the financial markets, ensuring the smooth and efficient processing of trades.

Explanation:

Rights Issue is the issuance of securities to existing investors as of a specific cut-off date, allowing them to buy more securities at a specific price. This method provides current shareholders with the opportunity to maintain or increase their ownership stake in the company by subscribing to additional shares before they are offered to the public. Public issue, Private placement, and Preferential issue refer to different methods of issuing securities, but they do not specifically involve the concept of offering shares to existing shareholders based on a cut-off date.

Explanation:

A depository holds securities in electronic form and enables the processing of securities transactions by means of a book entry. Depositories play a crucial role in the modern financial system by providing a secure and efficient way to hold, transfer, and settle securities electronically.

Explanation:

Marketing activities like advertisements, analysts, and broker meetings are conducted to promote the issue. These activities help create awareness, generate interest, and provide information about the issue to potential investors. The comprehensive approach involving all the mentioned methods contributes to the successful promotion of a financial issue.

Explanation:

The intermediaries that function in the primary market for equity and debt securities include merchant bankers, Book Running Lead Managers (BRLM), and Registrar and Transfer Agents (RTA). These entities play crucial roles in various stages of the issuance process, from underwriting and managing the issue to handling the transfer of securities and maintaining shareholder records. The combined efforts of these intermediaries contribute to the smooth functioning of the primary market.

Explanation:

The income generated by the fund is earned by investors in the form of growth and dividends. Growth represents the appreciation in the value of the fund’s assets, leading to capital gains for investors. Dividends are periodic distributions of the fund’s earnings to investors. Interest is not typically associated with the income earned by investors in the context of mutual funds.

Explanation:

The formula “Market price per share divided by Earnings per share” calculates the Price Earnings (P/E) ratio. This ratio is a valuation metric that helps investors assess the relative attractiveness of a stock by comparing its market price to its earnings per share. Price to Book Value ratio, Dividend yield, and Leverage ratio are different financial metrics with distinct calculations, and they are not represented by the given formula.

Explanation:

Debt security represents a contract between a company (issuer) and an investor (lender). This arrangement allows the issuer to borrow a predetermined sum of money under specified terms. In the context of debt securities, the issuer typically agrees to repay the borrowed amount along with interest at agreed-upon intervals.

Explanation:

Institutional investors are in a better position to understand the risks of investing in long-dated government securities and corporate bonds. These investors, which include entities like mutual funds, pension funds, and insurance companies, often have greater resources, expertise, and risk management capabilities compared to individual or retail investors. Traditional, Retail, and Individual generally refer to smaller-scale or non-professional investors who may have less capacity for in-depth risk analysis and management.

Explanation:

Futures contracts typically expire on the last Thursday of every calendar month. This expiration date is a standard practice in futures markets, providing a regular and consistent schedule for market participants. Wednesday, Monday, and Tuesday are not the standard expiration days for futures contracts.

Explanation:

Explanation:

Exchange-traded derivatives are standard derivative contracts defined by an exchange and are usually settled through a clearing corporation. Over The Counter (OTC) refers to non-standardized contracts traded directly between two parties. Options and Swaps are types of derivatives but may or may not be exchange-traded, depending on their nature.

Explanation:

Explanation:

Evaluating a stock for investment includes equity analysis and equity valuation and assessment. These processes involve examining various factors such as the financial health of the company, its growth prospects, industry trends, and the valuation of the stock. Equity Research is a broader term that encompasses various activities related to studying and analyzing stocks. However, in the context of the given options, it is not explicitly included.

Explanation:

Through securities investment, individual savings of many households can be mobilized into generating productive capacity for the country. This means that the funds from individual savings, when invested in securities, can contribute to the development of productive assets and projects, fostering economic growth and development. Liquidity,  Orderly channel for transfer of funds, and Information signaling are important aspects of securities investment but do not directly capture the idea of mobilizing savings into generating productive capacity.

Explanation:

In mutual funds, only one scheme per category is generally permitted, except for Index Funds / ETFs replicating / tracking different indices, Fund of Funds having different underlying schemes, and Sectoral/thematic funds investing in different sectors / themes. These exceptions allow for variations in the types of funds within a category.

Explanation:

Explanation:

The secondary market provides liquidity to securities by allowing them to be sold and converted to cash. In the secondary market, existing securities are bought and sold among investors, facilitating liquidity and price discovery. The Primary market involves the issuance of new securities, while options Currency market and Money market are distinct markets with different purposes.

Explanation:

A Merchant Banker assists an issuer in accessing the security market by facilitating the issuance of securities. They play a crucial role in the primary market, helping companies raise capital through activities such as initial public offerings (IPOs) and other securities issuances. Clearing Banks, Custodians, and Clearing Corporations are entities with different roles in the financial markets.

Explanation:

Value at Risk (VaR) Margin is defined as a multiple of volatility and expressed as a percentage of the stock price.

Explanation:

The availability of derivatives increases participation, information dissemination, and price discovery, making it beneficial for all the mentioned factors.

Explanation:

Tax-free bonds are mainly issued by Public Sector Undertakings (PSUs) in the infrastructure sector. These bonds are considered the right answer because they offer interest income that is exempt from income tax, making them an attractive investment option for individuals seeking tax-efficient returns.

Explanation:

A one-to-one transaction is one in which terms are determined and agreed upon mutually. This means that both parties involved in the transaction reach an agreement on the terms specific to their interaction, making it a personalized and negotiated arrangement. Therefore, “one-to-one transaction” is the correct answer.

Explanation:

A primary market is a market place where issuers directly meet the investors including FPIs to raise capital from them with the help of depository participants and brokers

Explanation:

The company justifies the price in a Fixed Price Issue based on the expected performance of the company and the consequent increase in the share price. In a Fixed Price Issue, the company determines a fixed price at which the shares will be offered to the public. This fixed price is often justified by considering the company’s performance and potential for future growth.

Explanation:

Equity capital is raised for perpetuity and is not returned during the life of the business. Equity represents ownership in a company, and unlike debt instruments such as debentures or preference shares, there is no obligation to repay the capital to shareholders.

Explanation:

A forward contract is a non-standard futures contract. In a forward contract, two parties agree to buy or sell an asset at a specified future date for a price agreed upon today. Unlike standardized futures contracts, which are traded on organized exchanges, forward contracts are customized agreements between two parties.

Explanation:

The trading lot for a futures contract is specified such that the value of the lot at the time of introduction is not less than Rs. 5 lakhs. In futures trading, a trading lot represents the standardized quantity of the asset that is bought or sold in a single transaction.

Explanation:

When an equity futures contract is introduced for the first time, its base price is determined by the stock exchange. The base price is typically established as part of the launch process and serves as a reference point for subsequent price movements in the futures contract.

Explanation:

The Reserve Bank of India (RBI) is the issue manager for the government. In the context of government securities, the RBI plays a crucial role in managing the issuance process and acts as the primary entity overseeing the government’s debt issuance. Therefore, option a) “RBI” is the correct answer.

Explanation:

These markets serve distinct purposes. The money market deals with short-term debt instruments, the securities market involves buying and selling of financial instruments like stocks and bonds, and the currency market focuses on foreign exchange.

Explanation:

e-NAM provides an electronic payment facility, allowing farmers to receive their payments without the necessity of visiting a bank. It is a platform that connects agricultural produce markets, facilitating online trading of agricultural commodities and streamlining the payment process for farmers.

Explanation:

An American option is one that can be exercised at any time before its expiry date. This flexibility allows the option holder to exercise the option at their discretion, providing more strategic opportunities compared to European options, which can only be exercised at expiration.

Explanation:

Explanation:

A stock exchange is classified as a market infrastructure institution (MII) and is regulated by SEBI (Securities and Exchange Board of India). Stock exchanges play a crucial role in facilitating the trading of securities and maintaining the integrity of the financial markets.

Explanation:

Bankers to an issue are selected bankers appointed during a new securities offering. They play a crucial role in collecting application forms and funds from investors who wish to purchase the securities being offered. This process is a part of the overall underwriting and issuance process facilitated by these appointed bankers.

Explanation:

SEBI has the authority to employ a combination of these measures to enforce regulatory compliance and maintain the integrity of the securities market.

Explanation:

When a company’s shares are traded as Depository Receipts (DR), it gains a wider investor base from international markets. Depository Receipts, such as American Depository Receipts (ADR), Global Depository Receipts (GDR), and Indian Depository Receipts (IDR), are financial instruments representing shares of a foreign company and are traded on international stock exchanges, making it easier for global investors to access and invest in the company.

Explanation:

The organized money market includes short-term lending and borrowing activities. It involves financial instruments and institutions that facilitate short-term capital transactions, such as money market funds, commercial papers, certificates of deposit, and other short-term debt securities. This market serves as a crucial component for managing liquidity and meeting short-term financial needs.

Explanation:

These financial instruments provide companies with different avenues to raise capital and meet their financing needs.

Explanation:

A preliminary red herring prospectus is filed with SEBI before the issue opens, and it includes the observations made by SEBI. This document provides potential investors with key information about the company and the securities being offered, though some details are subject to change. The final prospectus, known as the red herring prospectus, is issued after receiving regulatory approval.

Explanation:

Trading holidays may be modified if a need arises. Exchanges may alter their holiday schedules or trading hours under certain circumstances, such as market events, regulatory changes, or exceptional circumstances. This flexibility allows for adjustments in response to changing market conditions or other relevant factors.

Explanation:

An open-ended equity scheme investing in a maximum of 30 stocks is known as a Focused Fund. Focused funds are mutual funds that concentrate their portfolio on a limited number of stocks, typically up to 30, with the aim of achieving higher returns by focusing on a select set of high-conviction investments.

Explanation:

A regular lot order can be either a market order, executed at the current market price, or a limit order, specifying a desired price for execution.

Explanation:

Day traders rely on small movements in prices to make profits. They engage in short-term trading strategies, opening and closing positions within the same trading day to capitalize on intraday price fluctuations. Day trading involves a high level of activity and requires close monitoring of the markets.

Explanation:

Unlisted companies that have raised capital via Foreign Currency Convertible Bonds (FCCB) in foreign markets are required to list the shares on the domestic markets within a stipulated time frame. This regulation aims to bring transparency and ensure that domestic investors have access to information and trading opportunities related to the company’s securities.

Explanation:

The face value of a share is the basis for calculating the dividend payable on a share. It represents the nominal or original value of the share, and dividends are often declared as a percentage of the face value. The book value and market value of a share may differ and are not used directly in determining dividend payments.

Explanation:

The issuance of securities by companies is also subject to provisions of the Companies Act. The Companies Act outlines regulations and requirements that companies must adhere to, including those related to the issuance and management of securities.

Explanation:

Traded stocks are often categorized by market capitalization. Market capitalization, or market cap, is the total value of a company’s outstanding shares of stock, calculated by multiplying the stock’s current market price by the total number of outstanding shares. It is a common measure used to classify stocks into categories such as large-cap, mid-cap, and small-cap based on their respective market capitalizations.

Explanation:

Asset management companies are permitted to offer securities, known as units, that represent participation in a pool of money. This pool of money is used by the asset management company to create and manage investment portfolios on behalf of investors.

Explanation:

The derivative’s price and value are intricately linked with the underlying asset. The underlying asset is the financial instrument or security on which the derivative contract is based. The value and price movements of the derivative are directly influenced by changes in the value of the underlying asset.

Explanation:

Banks are the constituent that enables collections and payment of a mutual fund. They play a crucial role in processing transactions related to mutual funds, facilitating collections from investors and payments to them as needed.

Explanation:

A standard security refers to an agreement in which terms are accepted by both parties. It typically implies a standardized or widely accepted set of terms and conditions that are mutually agreed upon in a transaction.

Explanation:

Mutual funds are a type of investment that helps reduce the risk in equity investment for the investor. By pooling money from multiple investors and diversifying across a portfolio of stocks, mutual funds provide a way for investors to access a diversified and professionally managed investment, helping to spread and mitigate the risks associated with individual stock investments.

Explanation:

Depository participants open investor accounts, holding the securities that investors have purchased in dematerialized form. They act as intermediaries between the investors and the central depository, facilitating the process of holding and managing securities electronically.

Explanation:

In a book-built offer, the allocation pattern includes a minimum of 35% for retail individual investors, at least 15% for non-institutional investors, and a maximum of 50% for Qualified Institutional Buyers, with 5% reserved for mutual funds.

Explanation:

The term used to describe a group of securities is “Portfolio.” It refers to a collection of financial assets, such as stocks, bonds, and other investments, held by an individual, institution, or fund. Portfolios are constructed to achieve diversification and optimize the risk-return profile of an investment strategy.

Explanation:

Raising capital for a company may also be conducted through a syndicate of institutional investors who buy equity or debt securities through a private placement. In a private placement, securities are offered and sold directly to a select group of investors rather than through a public offering. This method is often used for larger investment amounts and involves a more targeted approach to investors.

Explanation:

The Asset Management Company (AMC) launches mutual fund schemes, collects money from investors, and manages the funds. The AMC is responsible for making investment decisions in line with the objectives of the mutual fund scheme and ensuring the effective management of the fund’s portfolio.

Explanation:

Premium margin refers to the premium amount due to be paid to the Clearing Corporation towards premium settlement at the client level. It is one of the components in the overall margin requirements in derivatives trading.

Explanation:

Fixed coupon bonds in the G-sec market have a fixed coupon rate, provide semi-annual interest payments, and are redeemed at par. The fixed coupon rate remains constant throughout the life of the bond.

Explanation:

Explanation:

Mutual funds in India are not permitted to borrow funds for investing in a portfolio.

Explanation:

When an investor places an order to buy a share, it is called a “bid.” This represents the investor’s willingness to purchase the stock at a specified price.

Explanation:

Debt instruments are defined by their time period to maturity and the rate of interest. These factors determine the duration of the investment and the interest income that the investor will receive over the specified time period.

Explanation:

An open-ended equity scheme predominantly investing in dividend-yielding stocks is known as a Dividend Yield Fund. This type of fund focuses on investing in stocks that have a track record of paying regular dividends, making it attractive for investors seeking income through dividend payouts.

Explanation:

The issuer, in making a public issue, appoints lead managers to manage the regulatory and operational aspects of the public offer of shares. Lead managers play a key role in coordinating various activities related to the issuance, including compliance with regulatory requirements and overseeing the process of bringing the shares to the market.

Explanation:

In a Nifty 50 futures contract, the underlying asset is the value of the Nifty 50 index. The futures contract derives its value from the performance of the Nifty 50 index, representing the basket of top 50 stocks listed on the National Stock Exchange (NSE) of India.

Explanation:

Stock exchanges are required to send daily monitoring reports. These reports provide critical information about market activities, price movements, and trading volumes, helping regulatory authorities and participants monitor and assess market conditions on a daily basis.

Explanation:

At the time of redemption of the debenture, investors can choose to receive shares of the company instead of the return of principal invested. This option is often referred to as a “debenture-to-equity” conversion, allowing investors to convert their debt holdings into equity shares of the issuing company.

Explanation:

Bank deposits, inter-corporate deposits, company fixed deposits, deposits with housing finance and other finance companies, chit funds, and benefit funds are all not securities. These are various forms of financial instruments, but they do not fall under the category of securities.

Explanation:

A Contract Note is a confirmation of trades in equity shares completed on a particular day for and on behalf of a client. It provides details of the transaction, including the quantity, price, and other relevant terms of the trade.

Explanation:

If a public issue is heavily over-subscribed, the number of shares allotted to each investor will be lower. Over-subscription occurs when the demand for shares exceeds the number of shares available for allocation. In such cases, the allotment is usually made on a proportionate basis, leading to a lower number of shares for each investor than initially anticipated.

Explanation:

The document that confirms a trade executed on the stock exchange is called a “Contract note.” It provides details of the transaction, including information about the securities traded, quantity, price, and other relevant terms.

Explanation:

Custodians are clearing members that manage both funds and securities settlement. They play a crucial role in safeguarding and managing the securities and funds of investors, facilitating the settlement of trades, and ensuring the smooth functioning of the financial markets.

Explanation:

Foreign investors are eligible to invest in Masala bonds. Masala bonds are rupee-denominated bonds issued by Indian entities in the overseas market. They allow foreign investors to participate in the Indian debt market while being exposed to the Indian rupee.

Explanation:

Derivatives permit efficient diversification of a traditional debt plus equity portfolio. Derivative instruments, such as futures and options, provide investors with tools to manage risk and optimize their portfolio by gaining exposure to various asset classes and market movements.

Explanation:

Retail Individual Investors who invest not more than Rs.2 lakhs in a single issue. This limit is defined to categorize and regulate the investment amount for retail individual investors in the context of public issues.

Explanation:

Examples of traditional investors include banks, mutual funds, and insurance companies. These entities are considered traditional investors as they typically engage in conventional forms of investing, such as holding stocks, bonds, and other financial instruments to meet their investment objectives.

Explanation:

In a contract, the option writer has the obligation. The option writer is the party that sells or writes the option contract and is obligated to fulfill the terms of the contract if the option is exercised by the option buyer.

Explanation:

Investors can make payments for investments in mutual funds using cash, cheque, and electronic payment modes. This provides flexibility for investors to choose a payment method that suits their preferences and convenience.

Explanation:

Derivative markets are structured to deal with risk arising out of changes in the value of something else in monetary terms. Derivative instruments derive their value from an underlying asset, and they are used to manage and hedge risks associated with price fluctuations in the underlying asset.

Explanation:

Derivatives are leveraged, unfunded, and risky instruments. They allow investors to gain exposure to assets or markets with a smaller initial investment, but this leverage also amplifies the potential risks and rewards associated with the underlying asset.