Important questions about Equity Investments - Equity Investments Section 1. Equity Investments - Equity Investments Section 1 MCQ questions with answers. Equity Investments - Equity Investments Section 1 exam questions and answers for students and interviews.
1. For stock X, market has the following limit oders standing on its book:
A : $10.09.
B : $9.93.
C : $9.79
2. A trader places a limit order to buy shares at a price of $14.75 with the
stock trading at a market bid price of $14.54 and the bid-ask spread of
0.7%. The order will most likely be filled at:
A : $14.54.
B : $14.64.
C : $14.75
3. The limit orders for a stock on market’s book is provided below:
A : $20.00.
B : $20.11.
C : $20.35.
4. Purchases and sales of an investment that tracks the KSE 100 stock
market index during an average trading day are best described as:
A : primary market transactions in a pooled investment.
B : secondary market transactions in a pooled investment.
C : secondary market transactions in an actively managed investment.
5. GP Investment bank agrees to help IFT Corp. raise funds on a best effort
basis. Who bears the risk when the entire issue is not sold to the public at
the stipulated offering price?
A : GP.
B : IFT.
C : Buyers of the part of the issue that is sold.
46. Analyst 1: Security market indices serve as market proxies when measuring risk-adjusted performance. Analyst 2 : Security market indices are often used as benchmarks to evaluate the performance of active portfolio managers. Which analyst‟s statement is most likely correct?
A : Analyst 1.
B : Analyst 2.
C : Both.
47. An index that contains securities with more than 90% of the market‟s total
value is most likely a:
A : broad market index.
B : sector index.
C : multi-market index.
48. An example of a style index is an:
A : index based on geographic regions.
B : index based on economic sector.
C : index based on value stocks.
49. On the basis of market, fixed income indices can be least likely classified as:
A : global.
B : currency zone.
C : investment grade.
50. Which of the following is least likely true with regards to hedge fund indices?
A : Returns are generally overstated.
B : Hedge funds can decide whether to report their performance to index
C : Returns are generally understated.
51. What is most likely a feature of hedge fund indices? They:
A : are frequently equal weighted.
B : are determined by the constituents of index.
C : reflect the value of private rather than public investments.
52. Which of the following statements regarding commodity indices is least likely
A : Most commodity indices use the same weighting methods.
B : Commodity indices containing the same underlying commodities might
have different returns.
C : Most commodity indices are based on commodity futures contracts.
53. Which of the following is least likely to be an issue pertaining to a commodity
A : Commodity indexes are based on future prices, rather than spot prices.
B : Commodity indexes may vary due to the use of different methodologies of
C : Commodity indexes may show an upward bias due to the reflected
performance of only surviving commodities.
54. An index based on market capitalization is most likely a:
A : broad market index.
B : sector index.
C : style index.
55. An example of a style index is an index based on:
A : geographic regions.
B : economic sector.
C : value stocks.
56. Which of the following is least likely a real estate index category?
A : Repeat sales index.
B : Initial sales index.
C : Appraisal index.
57. Tim is working on his assignment to compare equity indices with fixed income indices. From his class lecture, he recalls that 1) fixed income securities are harder to replicate 2) constituent securities of fixed-income indices are more liquid, and 3) constituent securities of fixed income indices are drawn from a
larger pool as compared to securities of equity indices. Out of the
three facts he recalls, which of the following is least likely correct?
A : Fixed income securities are harder to replicate.
B : Constituent securities of fixed-income indices are more liquid.
C : Constituent securities of fixed income indices drawn from a larger pool.
58. Which of the following statements is (are) least likely correct?
A : Statements 1 and 2.
B : Statements 1 and 3.
C : Statements 2 and 3.
59. Which of the following is most likely an example of a sector index?
A : Health care exchange-traded fund.
B : Wilshire 5000.
C : A small-cap growth index
60. Which of the following statements is most likely correct?
A : Statement 1.
B : Statement 2.
C : Statement 3.
Cfa Level 1 - Practice Questions more Online Exam Quiz