## MCQ on Security Analysis and Portfolio Management | Financial and Strategic Management MCQs for CS Executive and Other Competitive Exams

MCQ on Security Analysis and Portfolio Management: Check the below Financial and Strategic Management MCQ on Security Analysis and Portfolio Management with Answers Pdf free download. Financial and Strategic Management MCQ on Security Analysis and Portfolio Management Questions for Financial and Strategic Management with Answers were prepared based on the latest exam pattern. We have provided Financial and Strategic Management MCQ on Security Analysis and Portfolio Management with Answers to help students understand the concept very well. Students should practice CS Executive MCQ on Security Analysis and Portfolio Management Questions with Answers based on the latest syllabus.

## MCQ on Security Analysis and Portfolio Management

1. Standard deviation is a deviation from –
(A) Arithmetic mean
(B) Harmonic mean
(C) Median mean
(D) Mode mean

(A) Arithmetic mean

2. Investment with a lower standard deviation carries
(A) High risk
(B) Less risk
(C) Infinite risk
(D) Avoidable risk

(B) Less risk

3. Which of the following is on the horizontal axis of the Security Market Line?
(A) Standard deviation
(B) Beta
(C) Expected return
(D) Required return

(B) Beta

4. Standard deviation is expressed –
(A) Always in percentage
(B) In the same units in respect of which the deviation is computed
(C) In terms of rupee risk
(D) In terms of the amount

(B) In the same units in respect of which the deviation is computed

5. Covariance is a measurement of –
(A) The co-movement between two variables
(B) The link between the variability of returns in two independent securities
(C) Both (A) and (B)
(D) None of the above

(C) Both (A) and (B)

6. Expected worth is the –
(A) Inverse of standard deviation
(B) Correlation between a security
(C) Same as a discrete probability distribution
(D) Weighted average of all possible outcomes

(D) Weighted average of all possible outcomes

7. The market price of a bond depends on _____.
(A) The coupon rate and terms of the indenture
(B) The coupon rate and maturity date
(C) The terms of the indenture, and maturity date
(D) The coupon rate, terms of the indenture, and maturity date

(D) The coupon rate, terms of the indenture, and maturity date

8. Liquidity risk:
(A) Is risk investments bankers face
(B) Is lower for small companies
(C) Is the risk associated with secondary market transactions
(D) Increases whenever interest rates increase

(C) Is the risk associated with secondary market transactions

9. Which of the following is the correct formula to calculate returns of listed security?
(A) [(P1 – P0) + D] ÷ [P0 × 100] (B) [(P1 – P0) + D] ÷ [P1 × 100] (C) [(P1 – P0) – D] ÷ [P0 × 100] (D) [(P1 – P0) + D(1 – t)] ÷ P0 × 100

(A) [(P1 – P0) + D] ÷ [P0 × 100]

10. Correlation Coefficient supplements and upgrades the –
(A) Expected return
(B) WACC
(C) Covariance
(D) Mean deviation

(C) Covariance

11. Security Analysis is a process of estimating individual securities.
(A) Return and risk
(B) Risk and correlation
(C) Correlation and co-efficient
(D) Return and co-efficient

(A) Return and risk

12. Consider a graph with standard deviation on the horizontal axis and expected return on the vertical axis. The line that connects the risk-free rate and the optimal risky portfolio is called:
(A) Indifference curve
(B) The Capital market line
(C) Characteristic line
(D) Security market line

(B) The Capital market line

13. Standard deviation determine____
(A) Systematic risk of a security
(B) Unsystematic risk of security
(C) Total risk of security

(C) Total risk of security

14. Which of the following is the correct formula for the Correlation Coefficient?
(A) Covxy × σx × σy
(B) Covxy ÷ (σx × σy)
(C) (σx × σy) ÷ Covxy
(D) (σx ÷ σy ) × Covxy

(B) Covxy ÷ (σx × σy)

15. A risk associated with project and way considered by a well-diversified stockholder is classified as –
(A) Expected risk
(B) Beta risk
(C) Industry risk
(D) Returning risk

(B) Beta risk

16. An attempt to make a correction by adjusting historical beta to make it closer to an average beta is classified as –

17. _____ is one who exercises any degree of discretion as to the investment or management of the portfolio of the securities or the funds of the client.
(A) Non-discretionary portfolio man¬ager
(B) Portfolio investor
(C) Discretionary portfolio manager
(D) Portfolio custodian

(C) Discretionary portfolio manager

18. A corporate bond is a corporation’s write undertaking that it will refund a specific amount of money plus –
(B) Interest
(C) Nothing
(D) Security

(B) Interest

19. The advocates of the Efficient-market hypothesis (EMH) theory contend that securities markets are –
(A) Perfect
(B) Imperfect
(C) Monopolistic
(D) Perfect or at least not too imperfect

(D) Perfect or at least not too imperfect

20. Return from listed security is in two forms ____.
(A) One is interesting and the second is capital appreciation in price
(B) One is the stock split and the second is the dividend
(C) One is interesting and the second is a dividend
(D) One is dividend and the second is capital appreciation in price

(D) One is dividend and the second is capital appreciation in price

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