NISM XII Securities, Types and Asset Allocation — Practice Questions
The largest chapter in the XII syllabus. Practise equity, debt and hybrid instruments and their features, risk and return, the time value of money, and the principles of asset allocation and diversification.
132 questions on Securities & Asset Allocation in the ScoreSetu bank — each with a detailed explanation and, where useful, a memory hook.
What this topic covers
- Equity, debt and hybrid instruments
- Risk and return characteristics
- Time value of money
- Asset allocation and diversification
Free sample questions
1. An Indian company that is not eligible to raise equity capital in the domestic market is not eligible to make an FCCB issue either - State True or False ?
- A. True ✅
- B. False
Answer: A — True
Why: Foreign Currency Convertible Bonds (FCCBs) are foreign currency (usually dollar) denominated debt raised by companies in international markets but which have the option of converting into equity shares of the company before they mature. An Indian company that is not eligible to raise equity capital in the domestic market is not eligible to make an FCCB issue either.
💡 TRUE: Can't raise domestic equity -> can't do FCCB either.
2. Identify the INCORRECT statement with respect to the Cyber Security and Cyber Resilience guidelines Issued by SEBI for Stock brokers and Depository participants.
- A. All access to systems, applications, networks, databases etc. should be by virtue of a person’s rank in the organization ✅
- B. Stock brokers and Depository participants are required to submit quarterly reports to Stock Exchanges and Depositories on cyber-attacks and threats experienced by them
- C. A Technology Committee comprising experts must periodically review the Cyber Security and Cyber Resilience policy and take steps to strengthen the framework.
- D. All of the above are incorrect
Answer: A — All access to systems, applications, networks, databases etc. should be by virtue of a person’s rank in the organization
Why: The SEBI guidelines on Cyber Security and Cyber Resilience for stock brokers and depository participants (DPs) include - Protection of critical assets: All access to systems, applications, networks, databases etc. should be for a defined purpose and period and not simply by virtue of a person’s rank in the organization Governance: A Technology Committee comprising experts must periodically review the Cyber Security and Cyber Resilience policy and take steps to strengthen the framework. Reporting: Stock brokers and DPs are required to submit quarterly reports to Stock Exchanges and Depositories on cyber-attacks and threats experienced by them and measures taken to counteract such threats.
💡 Access is by PURPOSE & period, NOT by a person's RANK -> that statement (A) is the INCORRECT one.
3. The maturity of FCCB i.e. Foreign Currency Convertible Bonds, shall be not less than _____ .
- A. Two years
- B. Three years
- C. Five years ✅
- D. Ten years
Answer: C — Five years
Why: FCCBs are foreign currency (usually dollar) denominated debt raised by companies in international markets but which have the option of converting into equity shares of the company before they mature. The maturity of FCCB shall be not less than five years.
💡 FCCB maturity = NOT less than 5 YEARS.
Practise all 132 Securities & Asset Allocation questions
Plus the full 566-question NISM XII bank and real-feel mock exams.