NISM XII Mutual Funds — Practice Questions
Questions on mutual funds as a foundation topic: the structure of a fund, scheme categories, NAV and expenses, the NFO and Key Information Memorandum, and how an investor buys, redeems and is taxed.
112 questions on Mutual Funds in the ScoreSetu bank — each with a detailed explanation and, where useful, a memory hook.
What this topic covers
- Structure and scheme types
- NAV, loads and expenses
- NFO, KIM and scheme documents
- Buying, redeeming and taxation
Free sample questions
1. _______ comes under the purview of SEBI regulations.
- A. Valuation of securities held in mutual fund portfolio
- B. The format and disclosure details in a mutual fund offer document
- C. Types of expenses that can be charged to a mutual fund scheme
- D. All of the above ✅
Answer: D — All of the above
Why: All the above have to be as per SEBI regulations.
💡 SEBI governs MF valuation + offer-doc format + chargeable expenses (ALL of it).
2. A mutual fund folio has no transaction for six months. In this case the investor will not receive any Consolidated Account Statement. State whether True or False?
- A. True
- B. False ✅
Answer: B — False
Why: A consolidated account statement (CAS) across mutual fund holdings is sent to the investor for each calendar month where there have been transactions in a folio. Folios where no transactions have taken place during a six-month period will receive a statement at the end of such six-month period.
💡 FALSE: a no-transaction folio still gets a CAS at end of 6 months.
3. In the ____________ option, dividend is declared but not paid out to its unit holders.
- A. Growth option
- B. Re-investment of income distribution cum capital withdrawal option ✅
- C. Pay-out of income distribution cum capital withdrawal option
- D. All of the above
Answer: B — Re-investment of income distribution cum capital withdrawal option
Why: In the re-investment of Income Distribution cum Capital Withdrawal (IDCW) option, the dividend declared by the fund is not paid out, but is re-invested in the same scheme by buying additional units for the investor.
💡 RE-INVESTMENT IDCW option: dividend DECLARED but NOT paid out -> extra units bought.
Practise all 112 Mutual Funds questions
Plus the full 566-question NISM XII bank and real-feel mock exams.