Beginners Guide  Model Test Paper for BCDE in NEW TO TRADING & INVESTMENTS?  1. You sold a XYZ Stock put contract at Rs. 230 strike price for Rs. 28 each. The lot size ...

08272011 09:19 AM
Model Test Paper for BCDE
1. You sold a XYZ Stock put contract at Rs. 230 strike price for Rs. 28 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 276. What is your net profit (+) or loss ()?
Ans 33600
2. Investor A wants to buy 11 contracts of August series and Investor B wants to buy 8 contracts of September series at 4,500 and 4,550 respectively (contract multiplier 50). The Initial Margin is fixed at 6% (computed based on Price Scan Range) by the Clearing Corporation. How much Initial Margin is required to be collected from both investors together by the broker?
Ans 148500
3. You sold a XYZ Stock Call contract at Rs. 230 strike price for Rs. 28 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 272. Your option was automatically exercised. What is your net profit (+) or loss ()?
Ans 16800
4. If you sell a put option contract on a share with strike price of Rs. 245, market price
of Rs. 260 and a premium of Rs. 40, how much is the maximum gain that you may
have on expiry of this position?
Ans 40
5. In an Index Futures Contract, if the tick size is 0.01 of an index point and the index
multiple is Rs. 100, 'a tick' is valued
Ans 1
6. You sold a XYZ Stock put contract at Rs. 280 strike price for Rs. 28 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 241. Your option was automatically exercised. What is your net profit (+) or loss ()?
Ans 13200
7. Current Price of XYZ Stock is Rs. 236. Rs. 260 strike put is quoted at Rs. 45. What is the Intrinsic Value?
Ans 24
8. Investor A wants to buy 10 contracts of August series and Investor B wants to buy 7 contracts of September series at 4,500 and 4,550 respectively (contract multiplier 50). The Initial Margin is fixed at 6% (computed based on Price Scan Range) by the Clearing Corporation. How much Initial Margin is required to be collected from both investors together by the broker?
Ans 230550
9. You sold a XYZ Stock put contract at Rs. 230 strike price for Rs. 28 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 265. What is your net profit (+) or loss ()?
Ans 33600
10. You sold a XYZ Stock put contract at Rs. 280 strike price for Rs. 28 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 242. Your option was automatically exercised. What is your net profit (+) or loss ()?
Ans 12000

08272011 09:25 AM
11. You sold one XYZ Stock Futures contract Rs. 248 and the lot size is 1,200. What is your profit (+) or loss (), if you purchase the contract back at Rs. 251?
Ans 3600
12. You sold one XYZ Stock Futures contract Rs. 278 and the lot size is 1,200. What is your profit (+) or loss (), if you purchase the contract back at Rs. 270?
Ans 9600
13. You bought a January XYZ Stock Futures contract at Rs. 268 and the lot size is 1,200. What is your profit (+) or loss (), if you square off your position at at Rs. 283?
Ans 18000
14. You have sold a XYZ Stock Call contract, strike price Rs. 250 at a premium of Rs. 50. Lot size is 1,200. What is your profit (+) or loss (), if you purchase the Call back at Rs. 26?
Ans 28800
15. You have taken a short position of one contract in June XYZ futures (contract
multiplier 50) at a price of Rs. 3,200. You desire to make a profit of Rs. 10,000. Which of the following actions will enable you to generate desired profit? You may ignore
brokerage costs
Ans Buying 1 June XYZ futures contract at 3000
16. Beta of more than 1 means
Ans the expected percentage change in stock price will be more than the % change in Index
17. You bought a January XYZ Stock Futures contract at Rs. 268 and the lot size is 1,200. What is your profit (+) or loss (), if you square off your position at at Rs 290?
Ans 26400
18. You bought a XYZ Stock Put contract at Rs. 240 strike price for Rs. 25 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 315. What is your net profit (+) or loss ()?
Ans 30000
19. You bought a XYZ Stock Put contract at Rs. 280 strike price for Rs. 27 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 223. Your option was automatically exercised. What is your net profit (+) or loss ()?
Ans 36000
20. You bought a XYZ Stock Call contract at Rs. 280 strike price for Rs. 23 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 222. What is your net profit (+) or loss ()?
Ans 27600

08272011 09:30 AM
21. What are the eligible Liquid Assets, if a clearing member has deposited total assets of Rs. 850 Lakhs of which Rs. 500 Lakhs is by way of acceptable equity securities after considering the applicable haircuts in valuation of equity securities?
Ans 700
22. What are the eligible Liquid Assets, if a clearing member has deposited total assets of Rs. 900 Lakhs of which Rs. 500 Lakhs is in cash equivalents viz. Cash, bank guarantee, fixed deposits, Tbills and dated government securities?
Ans 900
23. What are the eligible Liquid Assets, if a clearing member has deposited total assets of Rs. 950 Lakhs of which Rs. 560 Lakhs is by way of acceptable equity securities
after considering the applicable haircuts in valuation of equity securities?
Ans 780
24. What can be the maximum percentage of cash and cash equivalents in liquid assets deposited by clearing members with the Clearing Corporation?
Ans 1
25. What should be the minimum percentage of noncash and noncash equivalents (i.e. equity shares) in liquid assets deposited by clearing members with the Clearing
Corporation?
Ans 0
26. Which of the following is closest to the forward price of a share, if Cash Price = Rs.
1200, Forward Contract Maturity = 6 months from date, Market Interest rate = 12%?
Ans 1272
27. A trader puts a market order for 100 shares of XYZ stock, executed at Rs. 780. He expects scrip price to move upward but wants to protect himself from downward
movement of the scrip. He doesn't want to lose more than Rs. 1000, if rate falls. For that he will,
Ans place a stop loss sell order for 100 XYZ stock @ 770/.
28. You sold a XYZ Stock Call contract at Rs. 230 strike price for Rs. 28 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 283. Your option was automatically exercised. What is your net profit (+) or loss ()?
Ans 30,000
29. A short position on futures contracts can be squared up by
Ans executing a purchase of futures contracts
30. You sold a XYZ Stock put contract at Rs. 230 strike price for Rs. 28 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 262. What is your net profit (+) or loss ()?
Ans 33600

08272011 09:35 AM
31. Short selling strategy is mostly used by the :
Ans Spectators
32. You sold one XYZ Stock Futures contract Rs. 278 and the lot size is 1,200. What is your profit (+) or loss (), if you purchase the contract back at Rs. 271?
Ans 8400
33. You have sold a XYZ Stock Put contract, strike price Rs. 220 at a premium of Rs. 48. Lot size is 1,200. What is your profit (+) or loss (), if you buy the Put back at Rs. 36?
Ans 1000000
34. You have sold a XYZ Stock Call contract, strike price Rs. 250 at a premium of Rs. 50. Lot size is 1,200. What is your profit (+) or loss (), if you purchase the Call back at Rs. 41?
Ans 14400
35. You own 10,000 shares of ABC at price of Rs. 110. The stock has a beta of 1. You wish to create a perfect hedge by selling stock index futures. What should be the value of stock index futures that you should sell?
Ans 1100000
36. You sold a XYZ Stock Call contract at Rs 280 strike price for Rs 28 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs 224. What is your net profit (+) or loss ()?
Ans 33600
37. You sold a XYZ Stock Call contract at Rs. 230 strike price for Rs. 28 each. The lot size is 1,200. On the expiry day, XYZ Stock closed at Rs. 260. Your option was automatically exercised. What is your net profit (+) or loss ()?
Ans 2400
38. You sold one XYZ Stock Futures contract Rs. 248 and the lot size is 1,200. What is your profit (+) or loss (), if you purchase the contract back at Rs. 269?
Ans 25200
39. You sold one XYZ Stock Futures contract Rs. 278 and the lot size is 1,200. What is your profit (+) or loss (), if you purchase the contract back at Rs. 263?
Ans 18000
40. What are the eligible Liquid Assets, if a clearing member has deposited total assets of Rs. 1000 Lakhs of which Rs. 590 Lakhs is by way of acceptable equity securities
after considering the applicable haircuts in valuation of equity securities?
Ans 820

08272011 09:41 AM
41. The difference between the spot price and the futures price is theoritically represented by
Ans 820
42. Investor A wants to buy 9 contracts of August series and Investor B wants to buy 6 contracts of September series at 4,500 and 4,550 respectively (contract multiplier 50). The Initial Margin is fixed at 6% (computed based on Price Scan Range) by the Clearing Corporation. How much Initial Margin is required to be collected from both investors together by the broker?
Ans Cost of carry
43. Investor A wants to sell 11 contracts of August series and Investor B wants to sell 8 contracts of September series at 4,500 and 4,550 respectively (contract multiplier 50). The Initial Margin is fixed at 6% (computed based on Price Scan Range) by the Clearing Corporation. How much Initial Margin is required to be collected from both investors together by the broker?
Ans 257700
44. On BSE, for its index futures, what would be the expiry day of its April series?
Ans Last Thursday in April
45. The shares of XYZ Ltd are currently quoted at Rs. 100. Futures on this share are
quoted at Rs. 113. In what situation would you buy these futures?
Ans You expect the price of the share to move up by 25%.
46. The ask price is the price at which
Ans The trader is prepared to sell the asset
47. Investor A wants to buy 7 contracts of August series and Investor B wants to buy 4 contracts of September series at 4,500 and 4,550 respectively (contract multiplier 50). The Initial Margin is fixed at 6% (computed based on Price Scan Range) by the Clearing Corporation. How much Initial Margin is required to be collected from both investors together by the broker?
Ans 149100
48. In which 'futures' contract, the contract cannot be used as a means of acquiring underlying asset?
Ans Stockindex
49. On BSE, for its index futures, what would be the expiry day of its May series?
Ans Last Thursday in May
50. In normal market, the forward contract having a longer time to maturity has a greater forward price.
Ans True
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