NISM Series VIII – Equity Derivatives Paper – 03

Q 1. A Clearing Member is responsible for the exchange for his transactions & also for the position of his trading members under him – True or False?


Q2.If the tick size of the scrip is 5 paise and the spot price of that scrip is Rs. 70, what will be the next upward tick?


Q3.In an In the money PUT option_
 strike price would be lower than the market price
 exercise price would be equal to the market price
 strike price would be higher than the market price
 strike price would be zero


Q4.A risky trader/speculator believes that the future price of ABC Company will fall and being a smart trader he will ____.
 buy ABC futures now and sell them later when it falls
wait till the price of ABC futures and cash market price become the same
 sell ABC futures now and buy them later when the price falls
 will do nothing as he had suffered a loss in his previous trade


Q5.____ means the maximum exposures in terms of a number of options and futures contacts that an investor can hold on one side of the market.
 Outstanding Limit
 Market Limit
 Position Limit
 Upper Limit


Q6.When would a trader make a profit on a short position of September futures?
when he buys an October future at a lower price
 when he sells another September future at a lower price
he squares of this short position by buying the September future at a lower price
 when he sells October futures at a lower price.


Q7.A clearing member is required to bring in an additional incremental deposit of __ to the clearing corporation for each additional TM he undertakes to clear and settle deals.
 Rs.5 lakhs
 Rs.10 lakhs
 Rs.15 lakhs
 Rs.20 lakhs


Q8.Stock Brokers are allowed to fund the margin requirement of their clients. Is the state True or False?


Q9.A call option is said to be ___ when the spot price is higher than the strike price.
 At the money
 Out of the money
 In the money


Q10.The mark-to-market margin debits for stock futures are done on a daily basis but the mark-to-market margin credits are done on a weekly basis – State whether True or False?

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