Practice Set - 3 | Practice Set | NISM Series XVI: Commodity Derivatives Certification Examination

Question 1

A trader profits from price difference across exchanges. This is:

Question 2

A trader closes position before expiry. This is called:

Question 3

If trader exits before expiry, delivery risk is:

Question 4

If a trader takes a long position and prices rise gradually, but volatility increases significantly, what is the most likely impact?

Question 5

Which of the following is least relevant to futures pricing?

Question 6

A trader holds a short position and market enters backwardation. What is the likely impact?

Question 7

If open interest decreases while volume remains high, it suggests:

Question 8

A sudden increase in both price and volume indicates:

Question 9

A trader uses all capital as margin. Risk level is:

Question 10

Which factor reduces arbitrage opportunity?

Question 11

A trader expects high volatility but uncertain direction. Futures trading is:

Question 12

If trader hedges partially, risk becomes:

Question 13

Which factor affects futures pricing directly?

Question 14

Which trader faces highest margin volatility?

Question 15

Which trader is least affected by price volatility?

Question 16

Which of the following reduces basis risk?

Question 17

If spot price suddenly increases but futures remain stable, what may happen next?

Question 18

If futures price equals spot price well before expiry, it indicates:

Question 19

Which scenario creates most confusion for traders?

Question 20

A futures contract nearing expiry shows minimal difference between spot and futures price. This indicates:

Question 21

A trader enters both long and short positions in different contracts of same commodity. This is:

Question 22

Which of the following can create artificial price movement in futures markets?

Question 23

A trader buys futures with insufficient margin and market moves against him. What happens first?

Question 24

Which scenario indicates strong bearish sentiment?

Question 25

A trader ignores MTM losses and holds position. Risk is:

Question 26

If futures contract is cash settled, it means:

Question 27

A trader with high leverage faces a small adverse price movement. The effect is:

Question 28

If futures price rises faster than spot, basis becomes:

Question 29

A trader enters wrong position but market reverses later. Final outcome depends on:

Question 30

If volatility increases sharply, margin requirements may:

Question 31

Which scenario creates maximum risk for trader?

Question 32

A trader profits only if price moves significantly. This indicates:

Question 33

If futures contract is illiquid, trader may face:

Question 34

If margin falls below maintenance level and trader does not respond, what happens?

Question 35

If futures prices are below spot prices consistently, market is in:

Question 36

If a trader expects price fall but market rises sharply, outcome is:

Question 37

If futures market becomes highly speculative, it may lead to:

Question 38

Which factor increases futures participation?

Question 39

Which scenario shows weak market trend?

Question 40

Which factor ensures contract performance?

Question 41

A trader with no risk management strategy is most exposed to:

Question 42

Which of the following is most affected by daily MTM?

Question 43

Which condition benefits arbitrageur most?

Question 44

Practice Set - 3