Mock 03

1. The first set of Guidelines on Loan Financing was issued on :A. 30th November 1994 B. 30th November 1995 C. 30th November 1996 D. 30th November 1997

6. The Net Asset Value of the fund is computed daily. This is to assess ..... A. The performance of other unit trust funds B. The agent's commissions C. The number of units in circulation D. The real value of the assets of the scheme

2. Which of the following are the roles of the trustee? I. To appoint an approved company auditor for the fund II. To calculate the trustee fee of the scheme III. To ensure the proper accounts and financial records and reports are kept by the management company IV. To ensure that all the terms of the Trust Deed are followed A. I, II, IV B. I, III, IV C. II, III, IV D. All of the above

7. Puan Wan has decided to withdraw of her savings to invest in unit trust. She would like to invest all of her money in a fund at one time and let it grow irrespective of the market condition. Whereas for Puan Anita, she has very little savings but every month she is willing to cut down some of her expenses and put in the unit trust investment. Name the respective ways, which they used to invest in the unit trust? A. Spot and Installment Plans B. Lump Sum Investment and Regular Savings Plans C. Lump Sum Investment and Contractual Plans D. Fixed Investment and Installment Plans

3. All assets of a unit trust scheme are held in the name of the ______________ for safekeeping. A. Investment Committee B. Unitholder C. Trustee D. Fund Management Company 4. Which of the following are the expenses of a unit trust scheme? I. management fees and trustee fee II. Auditor fees III. Cost of sending reports to unitholders IV. Cost of issuing dividend warrant A. I, II, III B. I, II, IV C. I, III, IV D. All of the above 5. A unit trust fund declared a gross dividend of 12 sen per unit. The NAV on cum-dividend is RM 240,000,000 and units in issue cum dividend are 200,000,000 units. What will be the NAV per unit ex-dividend? A. RM 1.13 B. RM 1.08 C. RM 2.28 D. RM 1.44

Set 3 / NSG Premier Consultants

8. Which of the following statement is not valid? A. The valuation and the determination of the selling and repurchase prices for units must be carried out at least once each business day. B. The management company must publish the selling price, repurchase price and net asset value per unit of the scheme daily in at least one National Bahasa Malaysia and one National English Newspaper. C. The valuation and the determination of the selling and repurchase prices for units are done by the trustee and must immediately notify the management company. D. The period of the initial offer must not exceed 21 days. 9. One of the unit trust features is ... A. When the interest rates increases, the return from unit trust funds will also increase B. The unitholders do not have to look for buyers when they want to liquidate their investment as the fund manager must repurchase from its untitholders. C. Lump sum investing is generally less risky than dollar cost averaging method of investing. D. An index fund serves as a benchmark for all the unit trust funds. 10. Please calculate the MER for the period of 1 January 199X to 31 December 199X, the expenses incurred by the Fund were :Management fee : RM 35,000 Trustee fee : RM 8,000 Auditor fee : RM 2,000 Bank charges & others : RM 5,000 The average fund size is RM 10,000,000 A. 0.5% B. 1% C. 1.3% D. 2% 1

11. Based on the Guidelines on Marketing and Distribution of unit trust, which of the following statements is not valid? A. Person registered with the management company and upon receiving the authorization card issued by the management company, are allowed to start selling unit trust funds B. The registered persons must ensure that they bring along the authorization card when visiting their prospect C. Investors who participate in loan financing scheme have to acknowledge the Risk Disclosure Statement D. Without the prospectus a registered person is not allowed to market and/or distribute units 12. A registered person when dealing in unit trust must I. Ensure that the fund proposed is suitable to the needs and not beyond the resources of the customer II. Decide on behalf of the unitholders to redeem their investment so as to realize the maximum return III. Encourage the customer to consider loan financing because that will help to reduce the customer's financial and investment burden IV. Market and distribute unit trusts with the prospectus of the fund. A. I, II B. I, IV C. II, III D. III, IV 13. As per requirement, the annual report of the scheme should include :I. Manager's Reports II. Trustee's Reports III. Statement of assets and liabilities IV. Auditor's Reports A. I, II B. I, III C. I, II, III D. All of the above 14. Which of the following is/are the benefit(s) of unit trust? A. Ready access to funds B. Spread of risk C. Reduce the cost of investment D. All of the above 15. When the unitholders want to redeem their units, how are their proceeds calculated? Set 3 / NSG Premier Consultants

A. Is is based on the repurchase price calculated at the end of trading day multiply with the number of units sold by the unitholders. B. Is is based on the fund manager's selling price calculated at the end of trading day multiply with the number of units sold by the untitholders. C. Is is based on the gross asset value of the fund divided by the number of units in circulation. D. It depends on how much the unitholder is willing to dispose off their investment. 16. Below are the areas that a fund management company can improve to better serve the clients, except: A. Provide a channel of complaints B. Regularly inform the unitholders on the latest fund performance C. Constantly report the latest development in the company to the SC D. Ensures the unit trust outperforms the other unit trust funds in the market 17. The investment of the unit trust scheme in any class of security of any issuer must not exceed __________________ of the security issued. A. 10 % B. 15% C. 20% D. No limit 18. To uplift the professional marketing image :I. PDUT must identify customer's needs and service those needs II. PDUT must deliver a product which the customer's expectations III. PDUT must work against “over-promise and under-deliver” IV. Multiple and alternative distribution channels need to be created A. I, II & IV B. I, III & IV C. II, III & IV D. All of the above 19. All the guidelines on distributing unit trust must be observed, except A. Marketing of distribution of units without a prospectus is prohibited by regulations B. A registered person should always conduct his dealings with due care, skill and diligence C. A registered person must only use advertisements and/or promotional materials that have been approved by the FMUTM D. A registered person should take every precaution to protect and preserve the confidentiality of investor information communicated to him 20. The selling price of units during the period of the initial offer should be determined by _____________ and adequately disclosed in the prospectus of the scheme. A. Guidelines on the Unit Trust Fund B. Trustee C. Securities Commission D. Management company 2

21. Each unitholder is to be sent a copy of the financial report of the fund within _____ months after the end of the financial period A. One B. Two C. Three D. Four 22. One of the features of listed fund is :A. The number of units are unlimited B. The prices are determined by the fund manager C. Listed funds are traded on a stock exchange D. Transactions are done between the fund manager and the investor 23. One type of equity unit trusts is “Islamic Fund”. What is the main investment objective of this fund? A. To provide regular income with less emphasis on capital growth B. To provide an investment opportunity for the Muslim investors to access to conventional banking, insurance and financial services and products C. To generate consistent income and thus allowing the unitholders to pay for their zakat D. To invest in accordance with the Syariah Principles 24. Which of the following statements is not valid? A. One of the reasons as why the percentage of the unit trust NAV to market capitalization in Malaysia is Comparatively lower than some other countries like the US and UK is because the Malaysian Government has a comprehensive retirement accumulation plan known as EPF. B. By increasing the professionalism and better marketing of the products by the fund management company, it will stimulate the growth of the unit trust industry in Malaysia. C. The concept of unit trust has been introduced in Malaysia since 1959. However, the industry only witnessed its rapid growth since 1990 D. The Securities Commission was established as a body solely representing the unit trust industry 25. The role of the unit trust manager includes the following, except :A. Recommends the purchase and sale of assets B. Collect all incomes C. Promotes the unit trust schemes D. Services the unitholders 26. Dollar-cost averaging is A. A strategy that entitles buying low and selling high B. A way to purchase unit trust funds and minimize the service charges C. A systematic way of regular investment with fixed amount of money D. A way to sell trust funds and to minimize the capital gains

Set 3 / NSG Premier Consultants

27. Which of the following is not the advantage of investing in a unit trust scheme? A. Diversification through a broad-based of portfolio B. Professional fund management C. Liquidity D. Guaranteed return 28. In general, which of the following types of unit trusts is likely to depreciate the most when the overall stock market falls? A. Equity unit trust B. Money market unit trust C. Fixed-income unit trust D. Property unit trust 29. “investment benchmarking” is A. Fund management objective that selects securities based on a specified Stock Exchange Composite Index B. Standard measures when assessing investment performance C. Shifting investment portfolio from stocks to fixed-income securities D. A strategy that entails buying low and selling high 30. As the unit trust market becomes more competitive, which will be the best way ti create more sources of prospects? A. Send more leaflets and brochures to individual companies B. Set up more branches C. Advertise more frequently in the newspaper D. Provide superior service to the existing customers, as new business comes from repeated business or through the network of existing satisfied, happy customers 31. The purpose of prospectus is A. To provide potential and existing investors with all the necessary information to make an informed decision. B. To outline the marketing plan of the scheme C. To highlight the projected returns of the scheme D. To outline the profile of the target investors 32. How do the investors exercise their redemption right? A. The process must go through a broker B. They need to fill up th repurchase form and submit it to the fund manager, as the fund manager is the ready buyer C. they must look for suitable buyer and the fund manager will transfer the units accordingly D. The unitholders need to hold the units until maturity

3

33. Some of the unit trust fund managers do charge a minimum amount of initial service charge. What is the purpose of charging such fee? A. Registration fee to participant in unit trust investment scheme B. Membership fee charged by FMUTM C. To subscribe to the annual report of the scheme D. To cover the costs of distribution 34. The fund manager of the unit trust scheme is allowed to charge management fee A. It is mainly to cover the management expenses incurred by the manager in managing the funds B. It is also known as advisory fee charged by the trustee C. This is the fee levied by the manager on the investor to cover the commission paid to the agents D. The fee is used to register the unitholders with the trustee 35. With regard to the sale of unit trust schemes .... A. The investors must contribute to the capital of the management company before investing in the unit trust scheme B. The management company must first engage an agency force before a scheme can be established C. The management company must first obtain an approval from the Securities Commission before it can operate in the public domain D. The fund manager must first gather sufficient number of investors before a new scheme can be launched 36. What is NAV per unit? A. It is the total value of the investment after deducting the service charge B. It is the ratio of the investment in fixed-income securities C. It is the net asset value of the investment divided by the number of units in issue D. Total units held by the scheme multiply with the repurchase price 37. The composition of the net asset value of a unit trust scheme consists of the following :A. The cost pf advertisement published in newspaper, TV, radio, etc B. The assets and the liability of the management company C. The value of the equity investment, money market investment, uninvested cash, the cost in respect of the portfolio investment after deducting the management fee, trustee fee and other administration expenses D. All of the above 38. Which of the following statement is not valid? A. Dollar cost-averaging principle should be used over a long-term period in order to maximize its benefits Set 3 / NSG Premier Consultants

B. The benefits of the dollar cost averaging principle is more significant in a fluctuating market C. Investors can benefit from applying the dollar cost averaging principle in the investment of unit trust schemes D. Dollar cost averaging principle is a way to obtain more units at a higher price 39. In general, which of the following has the lowest risk? A. Unit trust B. Fixed deposits C. Share D. Property 40. _________ is defined as spreading one's investment among many securities. It is an important method to reduce risk. A. Dollar-cost averaging principle B. Liquidity C. Diversification D. Asset allocation 41. Which of the following are the reasons for providing regular fund financial report to unitholder? I. To keep the unitholders informed II. It is statutory obligation III. For the purpose of declaring the dividend IV. To increase the MER of the fund A. I, II B. II, III C. I, II, III D. All of the above 42. The Malaysian Unit Trust Fund performance table compiled by Micropal highlights a few area of concern which include : I. Rate of return over time II. Ranking III. NAV IV. Selling & repurchase price A. I, II B. I, III C. II, III D. All of the above 43. A client has RM 100,000 and how long would it take to double his money at an assumed investment earning rate 12 % per annum? A. 5 years B. 6 years C. 7 years D. 8 years

4

44. Unit Trust which invest in shares are a means of investment generally for the ......... A. Short to middle term B. Short to long term C. Middle to long term D. Undefined duration 45. In an open-ended unit trust, buying and selling are done ... A. through the stock exchange B. through the trustee of the fund C. through the managers of the fund D. through the persons dealing with unit trusts of the management company 46. If an individual invests in unit trust fund, income derived from the investment comes from .... I. Interest Income II. Dividend Equalization III. Initial service charge and annual management fee IV. Capital gain A. I, Ii, III B. I, II, IV C. I, III, IV D. All of the above

A. Equity unit trusts C. Islamic unit trusts

B. Fixed income unit trusts D. Money Market unit trusts

52. After 1 January 1996, the maximum margin of finance for purchases of unit trust has been fixed at A. exactly 90 % B. not more than 80 % C. not more than 67 % D. not more than 50 % 53. “Rule of 72” is ......... A. Useful in determining and measuring the impact of inflation and compounding of returns B. To establish the loss in real value given an amount of funds and a given inflation rate C. To establish how long it would take to double our money, given the sum of money at a given interest rate D. All of the above 54. A client has RM 250,000 and wants an indication of how long it would take to double her money at an assumed investment earning rate of 8 % per annum. A. 9 years B. 10 years C. 11 years D. 12 years

47. The fund managers, who manage the unit trusts, purchase a wide range of investment because A. The wider the spread of investments, the less volatile the investment return will B. The risk of investment will be reduced to zero as a result of diversification C. The chances of selecting good performance stocks will increase D. A & C

55. The unit trust loan financing Risk Disclosure Statement clearly outlines the risks involved in the loan financing plan with the following information, except .... A. The issue of margin calls or “top up” of loan B. The margin of financing C. Returns for the unit trusts are guaranteed in the up market D. The service of loan repayment

48. The operation of the Trust is governed by a legal document called the ... A. Prospectus B. Trust Deed C. Annual Report D. Interim Report

56. In the unit trust loan financing, what is the rate of interest charged by the financier? A. Based Lending Rate (BLR) + manager's selling price B. Based Lending Rate (BLR) + financier's marked-up margin C. Manager's selling price + financier's marked-up margin D. Manager's selling price only

49. The manager of a unit trust fund has the following responsibilities, except .... A. Owns all of the assets of the trust B. Day to day management of the assets C. The distribution of income D. The calculation of unit prices 50. Which of the following is also called closed-ended fund? A. Islamic unit trusts B. Fixed income unit trusts C. Property unit trusts D. State unit trusts

57. The rights of an unitholders include ..... A. Cooling-off period of six working or business days B. To make queries including making complaints to the UTMC C. Right to receive distribution of income D. All of the above

51. The objective of these unit trusts funds is to provide regular income with less emphasis on capital growth Set 3 / NSG Premier Consultants

5

58. An investor holding 5,000 units before 1:2 unit split issue has an investment value at RM 7,500. After the unit split issue, he/she will ..... A. Hold 2,500 units with investment value at RM 15,000 B. Hold 7,500 units with investment value at RM 7,500 C. Hold 7,500 units with investment value at RM 15,000 D. Hold 10,000 units with investment value at RM 3,750 59. When a dividend is declared .... A. The investment value of an unitholder remains unchanged B. The dividend can be reinvested at Manager's selling price C. The investment value of an unitholder falls relative to the dividend paid D. The investment value of an unitholder increases relative to the dividend paid 60. When comparing the performance of a fund over a period of time, and the decreasing MER will indicate ..... A. The unit Trust Management Company (UTMC) is not managing the total fees and expenses well B. The Unit Trust Management Company (UTMC) is not managing the total fees and expenses well C. Nothing at all D. The net asset value (NV) of the fund is increasing 61. What is the percentage of the amount of EPF balance in excess of RM 55,000 to be invested in authorized unit trust? A. 10 % B. 15 % C. 20 % D. 30 % 62. Which of the following was established as a body to represent the unit trust industry? A. FMUTM B. National Investment Committee C. Danamodal D. Public Trustee 63. Which of the following is not true concerning the Prospectus? A. It is prepared by the Management Company and must be approved by the Trustee B. It must be approved by SC before the unit trust fund is launched C. It has t be renewed on an annual basis D. None of the above 64. All Provisional Registered Person Dealing Unit Trust (PDUT) must be registered with A. Unit Trust Management Company (UTMC) B. Securities Commission C. FMUTM D. Trustee

A. The past investment performances of the unit trust scheme B. His/her qualifications or that of the management company he/she represents C. The products and/or its characteristics offered by the management company he/she represents D. All of the above 66. All advertisements and/or promotional materials must be approved by ... A. FMUTM B. Trustee C. Securities Commission D. Bank Negara Malaysia (BNM) 67. The process of deciding how your investment dollars will be split among various classes of financial assets such as stocks, bonds, and cash reserves is best described as .... A. Dollar-cost averaging B. Asset allocation C. Investing D. Diversification 68. The principal of applying the systematic and regular investment of a fixed amount irrespective of the price level and works on the averaging cost principle of investment is called ...... A. Dollar-cost averaging B. Asset allocation C. Investing D. Diversification 69. Generally, a portfolio that has 80 % of its assets invested in growth stocks would be best suited for A. A college fund for a 18 year old B. An individual retirement account for a 32 year old C. An income producing portfolio for an 86 year old d. None of the above 70. In general, which of the following unit trust funds is likely to decline the most when the overall stock market falls? A. Aggressive growth fund B. Growth and income fund C. Bond fund D. Money market fund 71. Generally, during retirement, if investors epf to have a portion of their portfolio in equity unit trust, it is because ..... A. They always provide excellent dividend income B. Their return usually outpace inflation over time C. Historical returns show that stocks outperform bonds over the long term D. Both b and c

65. In order to maintain honesty, dignity and integrity, a registered person at all times must not misrepresent or recklessly represent .... Set 3 / NSG Premier Consultants

6

72. What is the most important benefit you get from creating a diversified portfolio that includes stocks, bonds and money market funds? A. Higher return than you get with a portfolio that isn't diversified B. The ability to balance both risk and return in achieving your financial goals C. A guarantee that your portfolio won't suffer if the stock market falls D. All of the above 73. As you approach your investment goal, which one of the following statements is generally most appropriate? A. You should be willing to assume more risk with your investments B. You should be willing to assume less risk with your investments C. You can stop monitoring your investments D. All of the above 74. Which of the following is not empowered to the Securities Commission? A. offers guidelines and rules on the operational aspects of the unit trust industry B. have the power to persecute and impose a penalty on breaches which have occurred C. have powers over the unit trust scheme and management companies fund managers, trustees and persons dealing with unit trusts D. to set up foreign fund management companies 75. Which of the following is not the responsibility of the trustee? A. look after the interests of unitholders by ensuring that the Manager follows the conditions set out in the trust deed B. run the trust C. remove the Fund manager who ails to manage the trust effectively and follow the conditions of the trust D. charge a fee the services provided based on the value assets in a trust 76. In 1996, the Malaysian Unit Trust Funds Performance Table prepared by Micropal Asia Limited was introduced. What is the purpose of the table ? A. provide FMUTM with a means to keep track of the unit trust industry and to tap into the fund manager's credibility B. provide investors with a means to monitor and evaluate the performance of the various unit trust scheme in Malaysia C. enable the public to understand the fees and charges charged by unit trust companies in Malaysia D. provide person dealing with unit trust to maintain accurate records on the various unit trust companies

unitholders are given the right to cancel their investment B. the cooling-off right is exercised by calling for a refund of investment C. the investor would receive the NAV or the repurchase price of units (whichever higher) in the day of cancellation plus the amount of initial service charge and other fees incurred D. the investor will be protected from the risk of market movement if the investors exercised the cooling-off right 78. The Guidelines on Unit Trust Funds was revised in 1995. The revision allowed A. Stockbroking houses with a minimum RM 100 million paid-up capital to set up unit trust management companies B. Unit Trust management companies to manage EPF funds of investors having RM 50,000 and above in Account 1 C. Unit trust management companies to launch bond funds D. Unit trust management companies to invest up to 10% of a NAV of a unit trust fund in foreign securities 79. Choose the correct statements ...... I. The primary objective of a growth fund is growth of capital II. Income fund seeks the lowest possible current income III. Islamic fund is a unit trust, which invests in accordance with Syariah principles IV. The main objective of a balanced fund is to build capital and provide some income from a balanced mix of investment A. All of the above B. I, II, III C. I, III, IV D. III, IV 80. The Trust Deed is to set out the formula to calculate thee fees payable to .... A. Securities Commissions B. Trustee and Manager C. The bank D. The consultants

77. Which of the following is not true concerning the cooling-off period? A. the said period is 6 business days from the purchase and during the said period, Set 3 / NSG Premier Consultants

7