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Quiz on Derivatives and NCDEX

Total questions: 151

Worksheet time: 1hrs 16mins

Name
Class
Date
1.

Which of the following best defines a derivative?

a)

A physical commodity

b)

A financial instrument whose value is based on an underlying asset

c)

A type of equity share

d)

A government bond

2.

Which is NOT a type of derivative?

a)

Futures

b)

Options

c)

Debentures

d)

Swaps

3.

The main difference between exchange-traded and OTC derivatives is:

a)

Exchange-traded are standardized and regulated

b)

OTC derivatives are traded on stock exchanges

c)

Exchange-traded derivatives are not regulated

d)

OTC derivatives have no counterparty risk

4.

Which of the following is a use of derivatives?

a)

Hedging

b)

Speculation

c)

Arbitrage

d)

All of the above

5.

In India, derivatives are regulated by:

a)

RBI

b)

SEBI

c)

IRDA

d)

FMC

6.

Which participant uses derivatives to reduce risk?

a)

Hedger

b)

Speculator

c)

Arbitrageur

d)

Broker

7.

Which of the following is an example of an underlying asset?

a)

Commodity

b)

Stock

c)

Currency

d)

All of the above

8.

Which market participant seeks to profit from price differences in different markets?

a)

Hedger

b)

Arbitrageur

c)

Speculator

d)

Investor

9.

Which of the following is NOT a feature of exchange-traded derivatives?

a)

Standardization

b)

High liquidity

c)

Customization

d)

Central clearing

10.

Which type of derivative is most likely to be traded OTC?

a)

Futures

b)

Options

c)

Swaps

d)

Forwards

11.

The first exchange to introduce derivatives trading in India was:

a)

BSE

b)

NSE

c)

MCX

d)

NCDEX

12.

Which of the following is NOT an underlying for derivatives?

a)

Real estate

b)

Interest rates

c)

Weather

d)

None of the above

13.

The process of reducing risk through derivatives is called:

a)

Hedging

b)

Speculation

c)

Investing

d)

Arbitrage

14.

Which of the following is NOT a benefit of derivatives?

a)

Price discovery

b)

Risk management

c)

Guaranteed returns

d)

Market efficiency

15.

The value of a derivative is primarily determined by:

a)

The underlying asset

b)

The central bank

c)

The government

d)

The broker

16.

Which of the following is NOT a derivative contract?

a)

Option

b)

Forward

c)

Mutual fund

d)

Swap

17.

Which participant in the derivatives market takes positions to profit from expected price movements?

a)

Arbitrageur

b)

Hedger

c)

Speculator

d)

Regulator

18.

Which of the following is a disadvantage of derivatives?

a)

Risk management

b)

High leverage

c)

Price discovery

d)

Liquidity

19.

Which of the following is true about OTC derivatives?

a)

Traded on exchanges

b)

Standardized contracts

c)

Customized contracts

d)

No counterparty risk

20.

The first derivative contract introduced in India was:

a)

Index futures

b)

Commodity futures

c)

Interest rate swaps

d)

Currency forwards

21.

Which of the following is NOT a reason for using derivatives?

a)

Hedging

b)

Speculation

c)

Arbitrage

d)

Philanthropy

22.

Which of the following is NOT a type of option?

a)

Call option

b)

Put option

c)

Swap option

d)

None of the above

23.

Which of the following is NOT a risk associated with derivatives?

a)

Credit risk

b)

Market risk

c)

Weather risk

d)

Operational risk

24.

Which of the following is a feature of futures contracts?

a)

Standardized

b)

Traded on exchanges

c)

Marked to market

d)

All of the above

25.

Which of the following is NOT a participant in the derivatives market?

a)

Hedger

b)

Speculator

c)

Arbitrageur

d)

Depositor

26.

Which of the following is a benefit of exchange-traded derivatives?

a)

Transparency

b)

Counterparty risk

c)

Illiquidity

d)

Customization

27.

Which of the following is NOT true about derivatives in India?

a)

Regulated by SEBI

b)

Only OTC trading allowed

c)

Both exchange and OTC trading

d)

Used for hedging and speculation

28.

Which of the following is NOT an example of an underlying asset?

a)

Gold

b)

Wheat

c)

Mutual funds

d)

Interest rates

29.

Which of the following is NOT a use of derivatives?

a)

Hedging

b)

Speculation

c)

Arbitrage

d)

Charity

30.

Which of the following is NOT an exchange-traded derivative?

a)

Futures

b)

Options

c)

Swaps

d)

Stock index futures

31.

What does NCDEX stand for?

a)

National Commodity and Derivatives Exchange

b)

National Credit and Derivatives Exchange

c)

National Commodity and Debt Exchange

d)

National Capital and Derivatives Exchange

32.

Which of the following is required to become an NCDEX member?

a)

SEBI registration only

b)

Capital adequacy and exchange membership

c)

RBI approval only

d)

Membership in BSE

33.

Which commodity is NOT typically traded on NCDEX?

a)

Gold

b)

Wheat

c)

Crude oil

d)

Cotton

34.

Which of the following is a feature of the NCDEX platform?

a)

Electronic trading

b)

Physical settlement only

c)

No risk management

d)

Manual order matching

35.

Which city is the headquarters of NCDEX located in?

a)

Delhi

b)

Mumbai

c)

Kolkata

d)

Chennai

36.

Which of the following is NOT a type of NCDEX member?

a)

Trading member

b)

Clearing member

c)

Depository member

d)

Professional clearing member

37.

The minimum capital requirement for NCDEX membership is determined by:

a)

RBI

b)

SEBI

c)

NCDEX

d)

Ministry of Finance

38.

Which of the following commodities is most actively traded on NCDEX?

a)

Silver

b)

Crude oil

c)

Guar seed

d)

Diamonds

39.

Which of the following is NOT part of the NCDEX trading system?

a)

Trader workstation

b)

Order matching engine

c)

Delivery warehouse

d)

Stock exchange floor

40.

Contract specifications on NCDEX include:

a)

Lot size

b)

Delivery center

c)

Quality parameters

d)

All of the above

41.

Which of the following is NOT a function of NCDEX?

a)

Providing trading platform

b)

Clearing and settlement

c)

Issuing government bonds

d)

Risk management

42.

Which of the following is NOT a benefit of trading on NCDEX?

a)

Transparency

b)

Counterparty risk

c)

Price discovery

d)

Risk management

43.

Which of the following is NOT a commodity group traded on NCDEX?

a)

Agricultural commodities

b)

Bullion

c)

Energy

d)

Real estate

44.

Which of the following is a contract specification parameter?

a)

Tick size

b)

Expiry date

c)

Delivery center

d)

All of the above

45.

Which of the following is NOT required for NCDEX membership?

a)

Net worth criteria

b)

SEBI registration

c)

RBI approval

d)

Infrastructure requirements

46.

Which of the following is NOT a type of order that can be placed on NCDEX?

a)

Limit order

b)

Market order

c)

Stop loss order

d)

Fixed deposit order

47.

Which of the following is a key benefit of NCDEX's electronic trading platform?

a)

Manual settlement

b)

High transparency

c)

No risk management

d)

Physical trading only

48.

Which of the following is NOT a role of the clearinghouse?

a)

Settlement of trades

b)

Risk management

c)

Issuing shares

d)

Margin collection

49.

Which of the following is NOT a feature of NCDEX contracts?

a)

Standardization

b)

Physical delivery

c)

Customization

d)

Daily settlement

50.

Which of the following is NOT a risk managed by NCDEX?

a)

Counterparty risk

b)

Price risk

c)

Political risk

d)

Settlement risk

51.

Which of the following commodities is NOT traded on NCDEX?

a)

Chana

b)

Soybean

c)

Natural gas

d)

Mustard seed

52.

Which of the following is NOT a benefit of NCDEX membership?

a)

Access to trading platform

b)

Clearing and settlement services

c)

Issuing government securities

d)

Risk management tools

53.

Which of the following is NOT a function of the NCDEX clearinghouse?

a)

Margin collection

b)

Trade settlement

c)

Order matching

d)

Risk management

54.

Which of the following is NOT a feature of NCDEX's risk management system?

a)

Margin requirements

b)

Daily mark to market

c)

Unlimited leverage

d)

Position limits

55.

Which of the following is NOT a requirement for trading on NCDEX?

a)

Membership

b)

Capital adequacy

c)

RBI approval

d)

SEBI registration

56.

Which of the following is NOT a type of margin on NCDEX?

a)

Initial margin

b)

Maintenance margin

c)

Variation margin

d)

Fixed deposit margin

57.

Which of the following is a global commodity exchange?

a)

NYMEX

b)

NSE

c)

BSE

d)

NASDAQ

58.

Bullion commodities refer to:

a)

Agricultural products

b)

Precious metals like gold and silver

c)

Industrial metals

d)

Energy products

59.

The first commodity exchange in India was:

a)

MCX

b)

NCDEX

c)

Bombay Cotton Trade Association

d)

NSE

60.

Which of the following is NOT an agricultural commodity?

a)

Wheat

b)

Gold

c)

Soybean

d)

Cotton

61.

Which of the following is NOT a function of a commodity exchange?

a)

Price discovery

b)

Risk management

c)

Issuing currency

d)

Clearing and settlement

62.

Which of the following is NOT a requirement for exchange membership?

a)

Net worth

b)

SEBI registration

c)

RBI approval

d)

Infrastructure

63.

Which of the following is NOT a global commodity exchange?

a)

LME

b)

NYMEX

c)

MCX

d)

CBOT

64.

Which of the following is NOT a feature of commodity derivatives?

a)

Hedging

b)

Price discovery

c)

Guaranteed returns

d)

Risk management

65.

Which of the following is NOT a type of commodity derivative?

a)

Futures

b)

Options

c)

Swaps

d)

Mutual funds

66.

Which of the following is NOT a benefit of commodity derivatives?

a)

Hedging

b)

Price discovery

c)

Risk management

d)

Guaranteed profits

67.

Which of the following is NOT a type of commodity?

a)

Agricultural

b)

Bullion

c)

Energy

d)

Real estate

68.

Which of the following is NOT a feature of commodity exchanges?

a)

Standardized contracts

b)

Clearing and settlement

c)

Issuing bonds

d)

Risk management

69.

Which of the following is NOT a requirement for commodity exchange membership?

a)

Net worth

b)

SEBI registration

c)

RBI approval

d)

Infrastructure

70.

Which of the following is NOT a commodity traded on global exchanges?

a)

Gold

b)

Wheat

c)

Oil

d)

Real estate

71.

Which of the following is NOT a function of commodity derivatives?

a)

Hedging

b)

Speculation

c)

Arbitrage

d)

Issuing shares

72.

Which of the following is NOT a feature of commodity derivatives?

a)

Standardization

b)

Customization

c)

Clearing and settlement

d)

Risk management

73.

Which of the following is NOT a type of commodity derivative contract?

a)

Futures

b)

Options

c)

Swaps

d)

Mutual funds

74.

Which of the following is NOT a benefit of commodity derivatives?

a)

Hedging

b)

Price discovery

c)

Risk management

d)

Guaranteed returns

75.

Which of the following is NOT a type of commodity?

a)

Agricultural

b)

Bullion

c)

Energy

d)

Real estate

76.

Which of the following is NOT a feature of commodity exchanges?

a)

Standardized contracts

b)

Clearing and settlement

c)

Issuing bonds

d)

Risk management

77.

Which of the following is NOT a requirement for commodity exchange membership?

a)

Net worth

b)

SEBI registration

c)

RBI approval

d)

Infrastructure

78.

Which of the following is NOT a commodity traded on global exchanges?

a)

Gold

b)

Wheat

c)

Oil

d)

Real estate

79.

Which of the following is NOT a function of commodity derivatives?

a)

Hedging

b)

Speculation

c)

Arbitrage

d)

Issuing shares

80.

Which of the following is NOT a feature of commodity derivatives?

a)

Standardization

b)

Customization

c)

Clearing and settlement

d)

Risk management

81.

Which of the following is NOT a type of commodity derivative contract?

a)

Futures

b)

Options

c)

Swaps

d)

Mutual funds

82.

Which of the following is NOT a benefit of commodity derivatives?

a)

Hedging

b)

Price discovery

c)

Risk management

d)

Guaranteed returns

83.

Which of the following is NOT a type of commodity?

a)

Agricultural

b)

Bullion

c)

Energy

d)

Real estate

84.

Which of the following is NOT a feature of commodity exchanges?

a)

Standardized contracts

b)

Clearing and settlement

c)

Issuing bonds

d)

Risk management

85.

Which of the following is NOT a requirement for commodity exchange membership?

a)

Net worth

b)

SEBI registration

c)

RBI approval

d)

Infrastructure

86.

Hedging in commodity futures is primarily used to:

a)

Increase speculation

b)

Reduce price risk

c)

Avoid taxation

d)

Manipulate markets

87.

A long hedge is suitable for someone who:

a)

Expects prices to fall

b)

Expects prices to rise

c)

Wants to lock in a selling price

d)

Is indifferent to price movement

88.

Arbitrage in commodity futures involves:

a)

Taking opposite positions in different markets to profit from price differences

b)

Only buying commodities

c)

Only selling futures

d)

Ignoring price differences

89.

Speculation in commodity futures is undertaken by those who:

a)

Want to hedge risk

b)

Seek to profit from price movements

c)

Are not interested in profit

d)

Only want delivery

90.

A short hedge is suitable for someone who:

a)

Expects prices to rise

b)

Expects prices to fall

c)

Wants to lock in a buying price

d)

Is indifferent to price movement

91.

The payoff for a long hedge is:

a)

Positive if prices rise

b)

Positive if prices fall

c)

Always negative

d)

Always zero

92.

The payoff for a short hedge is:

a)

Positive if prices rise

b)

Positive if prices fall

c)

Always negative

d)

Always zero

93.

Speculation with a bullish commodity involves:

a)

Buying futures contracts

b)

Selling futures contracts

c)

Doing nothing

d)

Arbitrage

94.

Speculation with a bearish commodity involves:

a)

Buying futures contracts

b)

Selling futures contracts

c)

Doing nothing

d)

Arbitrage

95.

Arbitrage with overpriced commodity futures involves:

a)

Buying futures

b)

Selling futures and buying spot

c)

Doing nothing

d)

Buying options

96.

Arbitrage with underpriced commodity futures involves:

a)

Selling futures

b)

Buying futures and selling spot

c)

Doing nothing

d)

Buying options

97.

Which of the following is NOT a function of commodity futures?

a)

Hedging

b)

Speculation

c)

Arbitrage

d)

Issuing shares

98.

Which of the following is NOT a type of hedge?

a)

Long hedge

b)

Short hedge

c)

Speculative hedge

d)

None of the above

99.

Which of the following is NOT a benefit of hedging?

a)

Risk reduction

b)

Price certainty

c)

Guaranteed profit

d)

Budgeting

100.

Which of the following is NOT a risk in speculation?

a)

Price risk

b)

Credit risk

c)

Guaranteed returns

d)

Market risk

101.

Which of the following is NOT a type of arbitrage?

a)

Spatial arbitrage

b)

Temporal arbitrage

c)

Speculative arbitrage

d)

None of the above

102.

Which of the following is NOT a characteristic of commodity futures?

a)

Standardized contracts

b)

Physical delivery always required

c)

Marked to market

d)

Traded on exchanges

103.

Which of the following is NOT a reason for using commodity futures?

a)

Hedging

b)

Speculation

c)

Arbitrage

d)

Charity

104.

Which of the following is NOT a risk in commodity futures?

a)

Price risk

b)

Counterparty risk

c)

Weather risk

d)

Operational risk

105.

Which of the following is NOT a benefit of commodity futures?

a)

Price discovery

b)

Risk management

c)

Guaranteed returns

d)

Liquidity

106.

Which of the following is NOT a function of commodity futures?

a)

Hedging

b)

Speculation

c)

Arbitrage

d)

Issuing shares

107.

Open interest in futures markets refers to:

a)

Total number of outstanding contracts

b)

Number of contracts traded in a day

c)

Number of new contracts issued

d)

Number of contracts that expired

108.

A circuit filter is used to:

a)

Limit extreme price movements

b)

Increase trading volume

c)

Eliminate all trading risks

d)

Remove unprofitable trades

109.

Daily mark to market settlement means:

a)

Settling profits and losses daily

b)

Settling only at contract expiry

c)

No settlement until delivery

110.

Daily mark to market settlement means:

a)

Settling profits and losses daily

b)

Settling only at contract expiry

c)

No settlement until delivery

d)

Settling monthly

111.

Which of the following is NOT a type of order in trading systems?

a)

Limit order

b)

Market order

c)

Stop loss order

d)

Fixed deposit order

112.

Which of the following is NOT an entity in the trading system?

a)

Trader

b)

Clearinghouse

c)

Depository

d)

Manufacturer

113.

Contract specifications include:

a)

Lot size

b)

Tick size

c)

Expiry date

d)

All of the above

114.

Which of the following is NOT a margin type in futures trading?

a)

Initial margin

b)

Maintenance margin

c)

Variation margin

d)

Fixed deposit margin

115.

Which of the following is NOT a function of the clearinghouse?

a)

Settlement of trades

b)

Risk management

c)

Issuing shares

d)

Margin collection

116.

Which of the following is NOT a feature of the trading system?

a)

Order matching

b)

Manual settlement

c)

Electronic trading

d)

Transparency

117.

Which of the following is NOT a type of exposure limit?

a)

Client-wise

b)

Member-wise

c)

Exchange-wise

d)

Broker-wise

118.

Which of the following is NOT a feature of daily settlement?

a)

Mark to market

b)

Settlement price

c)

Final settlement only

d)

Margin adjustment

119.

Which of the following is NOT a function of the NSCCL-SPAN system?

a)

Margin calculation

b)

Trade settlement

c)

Order matching

d)

Risk management

120.

Which of the following is NOT a reason for funds shortages?

a)

Insufficient margin

b)

Losses on positions

c)

Profitable trades

d)

Margin calls

121.

Which of the following is NOT a reason for delivery shortages?

a)

Insufficient stock

b)

Non-delivery by seller

c)

Profitable trades

d)

Delivery default

122.

Which of the following is NOT a feature of final settlement?

a)

Physical delivery

b)

Cash settlement

c)

Daily settlement

d)

Settlement price

123.

Which of the following is NOT a feature of the trading system?

a)

Electronic trading

b)

Manual order matching

c)

Transparency

d)

Order types

124.

Which of the following is NOT a type of order condition?

a)

Immediate or cancel

b)

Good till date

c)

Good till cancelled

d)

Fixed deposit order

125.

Which of the following is NOT a function of the trader workstation?

a)

Order placement

b)

Trade confirmation

c)

Margin calculation

d)

Issuing shares

126.

Which of the following is NOT a feature of exposure limits?

a)

Client-wise

b)

Member-wise

c)

Exchange-wise

d)

Broker-wise

127.

Which of the following is NOT a feature of settlement price?

a)

Determined by exchange

b)

Used for margin calculation

c)

Fixed by government

d)

Used for mark to market

128.

Which of the following is NOT a feature of settlement mechanism?

a)

Daily settlement

b)

Final settlement

c)

Manual settlement

d)

Margin adjustment

129.

Which of the following is NOT a function of the clearinghouse?

a)

Settlement of trades

b)

Risk management

c)

Issuing shares

d)

Margin collection

130.

Which of the following is NOT a feature of daily mark to market settlement?

a)

Profits and losses settled daily

b)

Margin adjustment

c)

Settlement at contract expiry only

d)

Used for risk management

131.

Which of the following is NOT a reason for funds shortages?

a)

Insufficient margin

b)

Losses on positions

c)

Profitable trades

d)

Margin calls

132.

Which of the following is NOT a reason for delivery shortages?

a)

Insufficient stock

b)

Non-delivery by seller

c)

Profitable trades

d)

Delivery default

133.

Which of the following is NOT a feature of final settlement?

a)

Physical delivery

b)

Cash settlement

c)

Daily settlement

d)

Settlement price

134.

Which of the following is NOT a feature of the trading system?

a)

Electronic trading

b)

Manual order matching

c)

Transparency

d)

Order types

135.

Which of the following is NOT a type of order condition?

a)

Immediate or cancel

b)

Good till date

c)

Good till cancelled

d)

Fixed deposit order

136.

Which of the following is NOT a function of the trader workstation?

a)

Order placement

b)

Trade confirmation

c)

Margin calculation

d)

Issuing shares

137.

Which body regulates commodity derivatives exchanges in India?

a)

RBI

b)

SEBI

c)

IRDAI

d)

Ministry of Finance

138.

Investor grievances in commodity markets are handled by:

a)

Exchange grievance redressal mechanisms

b)

Only police authorities

c)

Tax authorities

d)

No one

139.

Which of the following is a tax applicable in commodity trading?

a)

Securities Transaction Tax (STT)

b)

Goods and Services Tax (GST)

c)

Both A and B

d)

None

140.

Which of the following is NOT a rule governing commodity derivatives exchanges?

a)

SEBI regulations

b)

RBI guidelines

c)

Exchange bye-laws

d)

Government notifications

141.

Which of the following is NOT a rule governing trading on exchange?

a)

Trading hours

b)

Order matching

c)

Tax collection

d)

Margin requirements

142.

Which of the following is NOT an intermediary in commodity markets?

a)

Broker

b)

Clearing member

c)

Depository

d)

Manufacturer

143.

Which of the following is NOT a rule governing investor grievances?

a)

Exchange grievance redressal

b)

SEBI complaint mechanism

c)

Tax authority intervention

d)

Arbitration

144.

Which of the following is NOT a charge in commodity markets?

a)

Brokerage

b)

Exchange fee

c)

GST

d)

Fixed deposit interest

145.

Which of the following is NOT a feature of regulatory framework?

a)

SEBI regulation

b)

Exchange bye-laws

c)

RBI guidelines

d)

Corporate governance

146.

Which of the following is NOT a function of SEBI in commodity markets?

a)

Regulation

b)

Supervision

c)

Tax collection

d)

Investor protection

147.

Which of the following is NOT a feature of exchange bye-laws?

a)

Trading rules

b)

Settlement procedures

c)

Tax collection

d)

Membership criteria

148.

Which of the following is NOT a rule governing intermediaries?

a)

SEBI registration

b)

Capital adequacy

c)

Tax payment

d)

Infrastructure requirements

149.

Which of the following is NOT a function of exchange grievance redressal?

a)

Complaint resolution

b)

Arbitration

c)

Tax collection

d)

Investor protection

150.

Which of the following is NOT a tax in commodity trading?

a)

STT

b)

GST

c)

VAT

d)

Income tax

151.

Which of the following is NOT a charge in commodity trading?

a)

Brokerage

b)

Exchange fee

c)

GST

d)

Fixed deposit interest

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