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Fmutm Mock 05 | Investing | Investor

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1. FMUTM stands for: A. Federation of Malaysian Unit Trust Managers B. Federal Malaysian Unit Trust Managers C. Federation of Malayan Unit Trust Managers D. Federation of Malaysian Unit Trust Management 2. The main objective of FMUTM is: A. to sell unit trusts B. to teach agents to sell more unit trusts C. to ensure maximum return on investment  D. to enhance the professional standards and image of the  unit trusts industry. 3. The FMUTM council consists of how many elected members? A. 12 B. 10
  1. FMUTM stands for: A. Federation of Malaysian Unit Trust ManagersB. Federal Malaysian Unit Trust ManagersC. Federation of Malayan Unit Trust ManagersD. Federation of Malaysian Unit Trust Management2. The main objective of FMUTM is: A. to sell unit trustsB. to teach agents to sell more unit trustsC. to ensure maximum return on investmentD. to enhance the professional standards and image of theunit trusts industry.3. The FMUTM council consists of how many elected members? A. 12 B. 10 C. 15 D. 94. What are closed­ended Unit Trusts? A. The units are listed and traded on the stock exchange.B. The units are not listed on the stock exchange.C. Sales and repurchase are transacted directly with the fund manager.D. They are Islamic Unit Trusts.5. What are open­ended Unit Trusts? A. The units are listed and traded on the stock exchange.B. The units are not listed in the stock exchange sales and repurchaseare transacted directly with the fund manager.C. Transactions are through the stock broker.D. They are Islamic Unit Trusts.6. Who is empowered to regulate the unit trusts industry as well as havingpowers of prosecution penalty where breaches are known to happen? A. Securities Commission B. FMUTMC. Fund Managers D. Agents7. Who should report to Security Commission if the management company is notacting in the unit holders? A. Fund Managers B. Agents C. FMUTM D. Trustees8. “ Selling Price” in Unit Trust means A. Net Asset Value (NAV) B. NAV + Management FeesC. NAV + Initial Service Charge D. None of the above9. What legal document is being used in the Unit Trusts industry A. Sales and Purchase Agreement B. Trust DeedC. Power of Attorney D. None of the above10.The following is not the characteristics of open­ended unit trust fund: A. The units are not listed and traded on a stock exchange.B. The unit price fluctuates throughout the day.C. The calculation of the unit price is based on the Net Asset Value(NAV)D. The Fund Manager guarantees the re­purchase of the units at theprevailing unit price.11.The Assets of a fund is registered under: A. Bank Negara B. Trust DeedC. Trustee D. Fund Manager12.Trust Deed is based on the agreement between:I. Unit Holder II. Management CompanyIII. Trustee IV. FMUTM A. I , II & III B. I & IIIC. II & IV D. All of the above13.A type of equity unit trusts is 'index fund'. What is the main investmentobjective of this fund? A. to provide regular income with less emphasis on capital growth.B. to match the investment returns of a specified stock exchangesbenchmark.C. to generate higher income by balancing the portfolio in bonds,shares, cash and property.D. to provide higher returns by investing in international market.  Set 5 / NSG Premier Consultants 1  14.Which of the following is not associated with fixed­income unit trusts? A. The portfolio of the trusts mainly consists of bonds, governmentsecurities and liquid securities.B. Generally, the returns are lower than equity unit trusts.C. “Aggressive Growth Funds” can be classified as fixed­income unittrust.D. Generally, the returns are lower than equity unit trusts.15.Which of the following statements is valid? A. The income of property trust funds is derived from the rental incomeand capital appreciation of the property held by the scheme.B. The portfolio of the property trust­funds can be switched to equitieseasily as the assets are highly in liquid form.C. Property trust funds are not allowed to be listed.D. Unlisted trust funds are not allowed to invest in property trustfunds.16.High­risk investors may choose to invest in aggressive growth funds andother may consider investing balance funds. What are the factors that causethe investors to consider investing in balance funds?I. Generally, the return is higher than equity unit trust.II. The portfolio consists of wider range of asset classes.III. The portfolio of the fund is well balance and thus reduces the risk.IV. The returns are guaranteed. A. I & II B. II & IIIC. III & IV D. All the above17.What is MER known in the financial report? A. Monthly Expected Rate of ReturnB. Malaysian Evaluation StandardC. Mutual Fund Effective Rate of ReturnD. Management Expense Ratio18.Which of the following statements is not valid? A. One of the reasons why the percentage of the unit trusts NAV tomarket capitalization in Malaysia is comparatively lower than someother countries like the US and UK is because the Malaysiangovernment has a comprehensive retirement accumulation plan knownas EPF.B. By increasing the professionalism and better marketing of theproducts by the fund management company, it will stimulate thegrowth of the unit trust industry in Malaysia.C. The concept of unit trust has been introduced in Malaysia since1959. However the industry only witnessed its rapid growth since 1990.D. The Securities Commission was established as a body solelyrepresenting the unit trust industry.19.Dollar­cost averaging is: A. A strategy that entails buying low and selling high.B. A way to purchase unit trust funds and minimize the service charge.C. A systematic way of regular investment with fixed amount of money.D. A way to sell unit trust funds and to maximize the capital gains.20.Which of the following is not the advantage of investing in a unit trustscheme? A. Diversification through a broad­based of portfolioB. Professional fund managementC. LiquidityD. Guaranteed returns21.Under the Guidelines on Loan Financing, the management company andpersons dealing in unit trust industry must not encourage the investors toborrow money and invest it in unit trust. What are the disadvantages of financing the investment?I. The higher the margin of finance, the greater the potential for losses.II. If the interest rates rise, the total repayment amount will alsoincrease.III. The returns may be slightly better than saving in fixed deposit.IV. Investors may be asked to top up their investment amount when theunit prices fall. A. I, II & III   B. I, II & IV C. II, III & IV D. I, III & IV  Set 5 / NSG Premier Consultants 2  22.Investors normally used fixed deposit rates and share market index to assessthe performance of their investment. However, it can be misleading by onlyanalyzing the statistics provided. What are the other factors that need to beconsidered when assessing the performance?I. ConsistencyII. Risk LevelIII. Fees & Charges A. I & IIB. II & IIIC. I, II & IIID. None of the above23.In general, which of the following types of unit trusts is likely to depreciatethe most when the overall stock market falls? A. Equity unit trust B. Money market unit trustC. Fixed­income unit trust. D. Property unit trust24.The purpose of prospectus is? A. To provide potential and existing investors with all the necessaryinformation to make an informed decision.B. To outline the market plan for the scheme.C. To highlight the projected returns of the scheme.D. To outline the profile of the target investors.25.How can an investor hedge against inflation? A. Cut down all the unnecessary expenses and keep the money athome.B. Lower the tax rate of the investment.C. Invest the money in an investment instrument that can generatehigher return than the inflation rate.D. A & B26.How do the investors exercise their redemption right? A. The process must go through a broker.B. They need to fill up the repurchase form and submit to the fundmanager, as the fund manager is the ready buyer.C. They must look for suitable buyer and the fund manager willtransfer the units accordingly.D. The unit holders need to hold the units until maturity.27.The fees and charges imposed on a unit scheme will create some impact onthe overall returns of the investments. Name the fees and charges involved.I. Management FeeII. Trustee FeeIII. FMUTM membership feeIV. Initial service charge A. I, II & IIIB. I, II & IVC. I, III & IVD. All the above28.Most of the unit trust schemes charge an initial service charge and some of the charges are high. How can the investors minimize the charges? A. Top up more investment.B. Hold the investment for long term and let the value appreciate andachieve the investment objective.C. Invite more people to invest and ask for higher commission from themanagement company.D. When the performance of the fund falls below expectation, redeemthe investment immediately.29.What is 'NAV per unit'? A. It is the total value of the investment after deducting the servicecharge.B. It is the ratio of the investment in fixed­income securities.C. It is the net asset value of the investment dividend by the number of units in circulation.D. Total units held by the scheme multiply with the repurchase price.  Set 5 / NSG Premier Consultants 3  30.The composition of the net asset value of a unit trust scheme consists of thefollowing: A. The cost of advertisement published in newspaper, TV, radio etc.B. The asset and the liability of the management company.C. The value of the equity investment, money market investment,uninvested cash, the cost in respect of the portfolio investment afterdeducting the management fee, trustee fee and other administrationexpenses.D. All of the above.31.Which of the following statement is not valid? A. Dollar­cost averaging principle should be used over a long termperiod in order to maximize its benefits.B. The benefit of the dollar­cost averaging principle is more significantin a fluctuating market.C. Investors can benefit form applying the dollar­cost averagingprinciple in the investment of unit trust schemes.D. Dollar­cost averaging principle is a way to obtain more units at ahigher price.32._____________ is defined as spreading one's investment among manysecurities. It is an important method to reduce risk. A. Dollar­cost averaging B. LiquidityC. Diversification D. Asset Allocation33.Which of the following are the reasons for providing regular fund financialreport to unit holder?I. To keep the unit holders informed.II. It is a statutory obligation.III. For the purpose of declaring the dividend.IV. To increase the MER of the fund. A. I & IIB. II & IIIC. I, II & IIID. All of the above34.A client has RM 100,000 and how long would it take to double his money atan assumed investment earning rate of 12% per annum? A. 5 years B. 6 years C. 7 years D. 8 years35.___________ regulates the unit trust industry in Malaysia. A. Bank NegaraB. The Federation of Malaysian Unit Trust ManagersC. Securities CommissionD. Ministry of Finance36.What are the purposes of issuing the 'Guidelines on Unit Trust Funds?I. To govern the operation and administration that would protect theinterest of the investing public.II. To provide a regulatory environment that would protect the interest of the investing public.III. To facilitate the orderly development of the unit trust industry.IV. To make sure that the management company guarantees the return of the investment. A. I & IIIB. I, II & IIIC. II, III & IVD. All the above37.The principle legal document that binds together the unit trust managementcompany, the trustee and the unit holder is _____________ A. Guidelines on Unit Trust Funds.B. Unit Trust Loan Financing Risk Disclosure StatementC. Trust DeedD. Prospectus38.If the investment return is 10%, marginal tax rate is 20% and inflation rate is5%, what is the effective return after tax and inflation? A. 3%B. 4%C. 5%D. 2.5%  Set 5 / NSG Premier Consultants 4 
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