Practice Set - 3 | Practice Set | NISM Series XXI-B: Portfolio Managers Certification Examination

Question 1

A security with beta equal to 1 is expected to:

Question 2

The expected return under CAPM increases when:

Question 3

Which of the following most directly affects a stock’s beta?

Question 4

Can systematic risk be diversified away completely by increasing the number of securities?

Question 5

Can a stock with a beta less than zero theoretically exist?

Question 6

Can borrowing at the risk-free rate increase both expected return and portfolio risk?

Question 7

A stock with beta of 0.5 is expected to:

Question 8

A security with very high unsystematic risk but low beta is expected under CAPM to provide:

Question 9

According to CAPM, investors are rewarded for bearing:

Question 10

The Security Market Line uses which risk measure?

Question 11

A stock with beta equal to 1.2 is expected to:

Question 12

The Security Market Line helps investors determine whether a security is:

Question 13

Can a high-beta stock outperform the market during bullish periods?

Question 14

The slope of the Security Market Line represents:

Question 15

Can diversification reduce total portfolio risk below market risk completely?

Question 16

Can two diversified portfolios have identical standard deviation but different betas?

Question 17

Can a security with negative beta improve portfolio diversification?

Question 18

Can two securities with identical beta values have different expected total returns in practice?

Question 19

A security offering lower return than required for its beta is generally considered:

Question 20

According to CAPM, the market portfolio is assumed to be:

Question 21

The Capital Market Line assumes investors combine:

Question 22

Can a company-specific event significantly affect a stock with beta close to zero?

Question 23

The risk-free rate in Capital Market Theory is typically associated with:

Question 24

Which of the following is most likely diversified away in a large portfolio?

Question 25

A portfolio consisting entirely of risk-free assets would plot:

Question 26

According to CAPM, an investor should primarily focus on managing:

Question 27

A diversified investor is least concerned about:

Question 28

According to Capital Market Theory, efficient portfolios should provide:

Question 29

The market portfolio in Capital Market Theory is assumed to be:

Question 30

A beta greater than 1 generally suggests:

Question 31

Can a stock have high total volatility but low beta?

Question 32

According to Capital Market Theory, rational investors are expected to prefer portfolios:

Question 33

A stock lying below the Security Market Line most likely provides:

Question 34

Can the market portfolio itself be perfectly risk-free?

Question 35

Practice Set - 3