MCQ
SEBI and Capital Markets MCQ - Practice Questions with Answers
Solve 93 SEBI and Capital Markets questions for RAS/RPSC preparation.
Practice questions
Q1Consider the following statements regarding SEBI: 1. SEBI was initially constituted as a non-statutory body on 12 April 1988. 2. SEBI acquired statutory status on 30 January 1988. 3. SEBI was established as a statutory body in 1992. 4. The preamble to the SEBI Act refers to protection of investors' interests, development of the securities market and regulation of that market. Which of the statements given above are correct?
Statements 1, 3 and 4 are correct. SEBI began as a non-statutory body on 12 April 1988 and became a statutory body under the SEBI Act, 1992; hence statement 2 is wrong because it shifts statutory status to 1988. The Act's preamble frames SEBI's investor-protection, market-development and market-regulation role.
Q2Consider the following statements regarding market infrastructure institutions: 1. Market infrastructure institutions include stock exchanges and depositories that facilitate trading, clearing and settlement of securities. 2. SEBI regulates MIIs to maintain transparency, investor protection and financial stability. 3. Clearing corporations transfer securities from seller to buyer in demat accounts. Which of the statements given above are correct?
Statement 1 is true because SEBI Investor identifies stock exchanges and depositories as MIIs that facilitate trading, clearing and settlement. Statement 2 is true because SEBI regulates MIIs for transparency, investor protection and financial stability. Statement 3 is false: the clearing corporation verifies funds and securities availability, while the depository transfers securities from seller to buyer.
Q3Consider the following statements regarding foreign institutional investment and market access: 1. SEBI's functions include registering and regulating foreign institutional investors. 2. SEBI's functions include registering and regulating custodians of securities. 3. Foreign portfolio investors are registered by the Reserve Bank of India alone, with no SEBI role under the SEBI Act. 4. Custodians of securities are among the intermediaries mentioned in SEBI's statutory functions. Which of the statements given above are correct?
Statements 1, 2 and 4 are correct. The SEBI Act lists registration and regulation of foreign institutional investors and custodians of securities among SEBI's functions. Statement 3 is false because it denies SEBI's expressly stated role.
Q4Consider the following statements regarding investor grievance redressal: 1. For a complaint against a listed company or SEBI-registered intermediary, the investor should first approach the concerned company or intermediary. 2. If a complaint is lodged, the entity is required to file an Action Taken Report with SEBI within 30 days of receipt of the complaint. 3. SCORES does not allow investors to track complaint status online. Which of the statements given above are correct?
Statements 1 and 2 are correct: SEBI investor material says the investor should first approach the concerned entity and that entities must file an ATR within 30 days. Statement 3 is false because SCORES allows online follow-up and tracking.
Q5Consider the following statements regarding mutual funds: 1. NAV stands for Net Asset Value. 2. NAV represents the per-unit market value of securities held in a mutual fund's portfolio after subtracting liabilities. 3. A larger AUM necessarily indicates strong past performance of a mutual fund. Which of the statements given above are correct?
Statement 1 is true because NAV stands for Net Asset Value. Statement 2 is true because NAV is the per-unit market value of the mutual fund portfolio after liabilities are subtracted. Statement 3 is false: SEBI Investor cautions that a larger AUM does not necessarily indicate strong past performance.
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6Consider the following statements regarding SEBI: 1. SEBI was constituted as a non-statutory body on April 12, 1988. 2. SEBI was established as a statutory body in 1992 under the SEBI Act, 1992. 3. The provisions of the SEBI Act, 1992 came into force on January 30, 1993. Which of the statements given above are correct?
7Consider the following statements regarding SEBI: 1. SEBI was constituted as a non-statutory body on April 12, 1988 through a Government of India resolution. 2. The SEBI Act, 1992 came into force on January 30, 1992. 3. SEBI's statutory mandate includes investor protection, development of the securities market and regulation of the securities market. 4. The preamble of the SEBI Act confines SEBI's basic function only to investor protection, excluding market development. Which of the statements given above are correct?
8Consider the following statements regarding mutual fund governance under SEBI regulations: 1. A sponsor must have contributed, or must contribute, at least 40 percent to the net worth of the asset management company. 2. Appointment of an asset management company can be terminated by majority of trustees or by seventy-five percent of the scheme's unitholders. 3. Any change in the appointment of the asset management company is subject to prior approval of the Board and the unitholders. 4. The sponsor alone can always terminate the asset management company without trustee or unitholder involvement. Which of the statements given above are correct?
9Consider the following statements regarding SEBI-registered Investment Advisors: 1. SEBI's investor page describes an Investment Advisor as a SEBI-registered professional. 2. An Investment Advisor provides personalised financial guidance based on financial goals, risk appetite and market conditions. 3. The same SEBI investor page says Investment Advisors earn commissions from mutual fund sales, unlike mutual fund distributors. 4. Under the SEBI Investment Advisers Regulations, 2013, an Investment Advisor advises on financial securities, investment strategies and portfolio allocation while following fiduciary responsibilities. Which of the statements given above are correct?
10Consider the following statements regarding SCORES: 1. SCORES is an online grievance redressal facilitation platform provided by SEBI. 2. SCORES covers grievances pertaining to the securities market against SEBI-regulated listed companies, registered intermediaries and market infrastructure institutions. 3. Investors should first take up their grievances with the entity concerned before using SCORES. Which of the statements given above are correct?
11Consider the following statements regarding recognised stock exchanges in India: 1. BSE Ltd. is listed by SEBI with permanent recognition and permitted segments including equity, equity derivatives, currency derivatives, commodity derivatives, debt and Electronic Gold Receipt. 2. National Stock Exchange of India Ltd. is listed by SEBI with permanent recognition and permitted segments including equity, equity derivatives, currency derivatives, commodity derivatives and debt. 3. Jaipur Stock Exchange Ltd. is listed by SEBI among stock exchanges granted exit, with exit date 23 March 2015. 4. National Commodity & Derivatives Exchange Ltd. is listed by SEBI with equity and debt as its permitted segments. Which of the statements given above are correct?
12Consider the following statements regarding ASBA in IPOs: 1. Investors can apply for securities in IPOs through Application Supported by Blocked Amount. 2. Under ASBA, money to the extent of the price of shares applied for is blocked but remains in the applicant's account till allotment. 3. The blocked amount stops earning interest during the blocking period. 4. Investors can use UPI as a payment mechanism for investing in IPOs. Which of the statements given above are correct?
13Consider the following statements regarding the depository ecosystem: 1. Depository participants are intermediaries between depositories and investors. 2. Banks and stockbrokers may act as examples of depository participants. 3. Clearing corporations work with depositories to transfer securities from sellers to buyers. 4. Depositories facilitate only paper-based settlement and do not use electronic book entries. Which of the statements given above are correct?
14Consider the following statements regarding SEBI's protective measures pending or after inquiry: 1. SEBI may suspend trading of any security in a recognised stock exchange. 2. SEBI may restrain persons from accessing the securities market. 3. SEBI may prohibit a person associated with the securities market from buying, selling or dealing in securities. 4. SEBI may take such measures only after completion of a criminal trial, not pending investigation or inquiry. Which of the statements given above are correct?
15Consider the following statements regarding the depository system in India: 1. A depository holds securities only as paper certificates and does not hold them electronically. 2. NSDL was established in 1999 and CDSL was established in 1996. 3. Investors can open an account directly with NSDL or CDSL without a Depository Participant. Which of the statements given above are correct?