Mutual Funds MCQs September 11, 2025 by u930973931_answers 50 Score: 0 Attempted: 0/50 Subscribe 1. A mutual fund is primarily a/an: (A) Company manufacturing products (B) Investment vehicle pooling money from investors (C) Bank deposit scheme (D) Government subsidy 2. The organization that manages mutual fund investments is called: (A) Portfolio Management Company (B) Asset Management Company (AMC) (C) Stock Exchange (D) Central Bank 3. The price at which investors buy mutual fund units is called: (A) Market Price (B) Net Asset Value (NAV) (C) Issue Price (D) Redemption Price 4. Open-ended mutual funds allow investors to: (A) Buy and sell units at any time (B) Invest only during launch period (C) Trade only on stock exchanges (D) Exit only at maturity 5. Closed-ended mutual funds are traded: (A) Only with the AMC (B) On stock exchanges like shares (C) At banks (D) With government approval only 6. Which regulatory body governs mutual funds in India? (A) RBI (B) SEBI (C) Ministry of Finance (D) IRDA 7. Systematic Investment Plan (SIP) means: (A) One-time lump sum investment (B) Regular fixed investment at intervals (C) Borrowing from AMC (D) Dividend reinvestment only 8. The profit distributed by a mutual fund is called: (A) Dividend (B) Bonus (C) Interest (D) Capital repayment 9. Which type of mutual fund invests only in stocks? (A) Debt Fund (B) Equity Fund (C) Hybrid Fund (D) Index Fund 10. Debt funds primarily invest in: (A) Shares (B) Bonds and fixed-income securities (C) Real estate (D) Commodities 11. Hybrid funds invest in: (A) Only gold (B) Both equity and debt (C) Only real estate (D) Only preference shares 12. NAV of a mutual fund is calculated as: (A) Assets โ Liabilities / Total Units (B) Profit โ Loss / Total Units (C) Market Price ร Units (D) Total Liabilities รท Units 13. Which mutual fund mirrors the performance of a market index? (A) Balanced Fund (B) Index Fund (C) Growth Fund (D) Income Fund 14. Mutual fund investors are also called: (A) Creditors (B) Unit holders (C) Shareholders (D) Debtors 15. Which type of mutual fund provides liquidity on demand? (A) Close-ended (B) Open-ended (C) Fixed Maturity Plan (D) ELSS 16. Expense ratio in a mutual fund shows: (A) Total return earned (B) Percentage of expenses charged on assets (C) Brokerage commission (D) Dividend payout rate 17. Equity Linked Savings Scheme (ELSS) provides: (A) No tax benefits (B) Tax benefits under section 80C (C) Guaranteed returns (D) Only debt investment 18. Which fund is suitable for short-term goals with low risk? (A) Equity Fund (B) Debt Fund (C) Index Fund (D) Sectoral Fund 19. Sectoral funds invest in: (A) All industries equally (B) Specific industry sectors (C) Government bonds (D) Only banking sector 20. The risk level of equity funds is generally: (A) Low (B) Medium (C) High (D) Zero 21. Mutual funds are most suitable for: (A) Large institutional investors only (B) Small and retail investors (C) Government officers (D) Exporters only 22. Fund managers are responsible for: (A) Collecting dividends (B) Making investment decisions (C) Registering investors (D) Issuing chequebooks 23. Growth funds aim to: (A) Generate fixed income (B) Increase capital value (C) Reduce tax liability only (D) Provide guaranteed returns 24. Money Market mutual funds invest in: (A) Long-term assets (B) Short-term instruments (C) Real estate (D) Commodities 25. Mutual funds reduce risk through: (A) Borrowing (B) Diversification (C) Speculation (D) Insider trading 26. Dividend reinvestment option means: (A) Dividend is credited to bank account (B) Dividend is used to buy more fund units (C) Dividend is forfeited (D) Dividend is paid to AMC 27. Which mutual fund is best for regular income? (A) Growth Fund (B) Income Fund (C) Sectoral Fund (D) Gold Fund 28. Net Asset Value (NAV) is declared: (A) Daily (B) Monthly (C) Yearly (D) Only at launch 29. Which fund invests in international markets? (A) Domestic Fund (B) Global/International Fund (C) Debt Fund (D) Balanced Fund 30. Exchange Traded Funds (ETFs) are traded: (A) Only with AMCs (B) On stock exchanges like shares (C) Through banks (D) Only once a year 31. Load in a mutual fund means: (A) Extra bonus given (B) Charges/fees for entry or exit (C) Interest rate (D) Tax deduction 32. No-load funds mean: (A) No charges for entry/exit (B) No returns (C) No taxes (D) No dividends 33. Mutual funds provide investors with: (A) Professional management (B) Diversification (C) Liquidity (D) All of the above 34. Which type of mutual fund has a lock-in period? (A) ELSS (B) Index Fund (C) Debt Fund (D) Hybrid Fund 35. Which is the safest type of mutual fund? (A) Sectoral Fund (B) Debt Fund (C) Equity Fund (D) International Fund 36. Which fund is highly volatile? (A) Equity Fund (B) Debt Fund (C) Balanced Fund (D) Liquid Fund 37. Mutual fund pooling of money is done to achieve: (A) Speculation (B) Collective investment benefits (C) Monopoly (D) Insider trading 38. Redemption of units means: (A) Buying new units (B) Selling back units to AMC (C) Pledging units for loan (D) Transferring units to others 39. Balanced funds are also called: (A) Equity-heavy funds (B) Hybrid funds (C) Money market funds (D) ELSS 40. Which scheme helps in short-term parking of funds? (A) Growth Fund (B) Liquid Fund (C) Equity Fund (D) Index Fund 41. Which is an example of systematic withdrawal plan? (A) Monthly redemption of units (B) SIP (C) Dividend reinvestment (D) Bonus shares 42. Risk in mutual funds is measured through: (A) Profit margin (B) Standard deviation and Beta (C) Expense ratio (D) Dividend payout 43. The main advantage of mutual funds for retail investors is: (A) High entry cost (B) Expert management and diversification (C) Guaranteed profit (D) Insider trading rights 44. Which mutual fund invests in gold-related instruments? (A) Equity Fund (B) Gold ETF/Fund (C) Debt Fund (D) Hybrid Fund 45. Open-ended funds are launched through: (A) IPO (B) NFO (New Fund Offer) (C) Rights Issue (D) Bonus Issue 46. A fund that replicates Nifty 50 is called: (A) Growth Fund (B) Sector Fund (C) Index Fund (D) Debt Fund 47. The lock-in period for ELSS is: (A) 1 year (B) 3 years (C) 5 years (D) 10 years 48. The entity that holds mutual fund assets in custody is: (A) AMC (B) Trustee (C) Custodian (D) Registrar 49. The minimum SIP amount in most mutual funds can start from: (A) โน100 (B) โน500 (C) โน5,000 (D) โน10,000 50. Mutual funds are suitable for investors who want: (A) Diversified, professionally managed portfolios (B) Direct control over each stock (C) Guaranteed fixed return (D) Only speculative gains