nism 8 mock test - Quiz Questions (Page 2 of 2)
This quiz contains 20 questions.
Question 11: What does 'open interest' refer to in futures markets?
- Pending dividends
- Number of total contracts open (Correct Answer)
- Current share prices
- Stock availability
Question 12: Which risk is associated with dividend-paying stocks?
- Credit risk
- Interest rate risk
- Reinvestment risk (Correct Answer)
- Exchange rate risk
Question 13: What does 'volatility' measure in an asset's return?
- Price history
- Market volume
- Price variability (Correct Answer)
- Investment duration
Question 14: Derivatives are primarily used for which purpose?
- Direct investment
- Market speculation
- Risk management (Correct Answer)
- Currency exchange
Question 15: What is the purpose of a 'stop-loss' order?
- Lock profits
- Increase price
- Limit potential loss (Correct Answer)
- Correct market price
Question 16: Which derivative product is settled only in cash?
- Equity share
- Physical forward
- Index futures (Correct Answer)
- Commodity warrant
Question 17: What defines 'intrinsic value' of an option?
- Market speculation
- Time until expiry
- In-the-money amount (Correct Answer)
- Stock price weight
Question 18: What does it mean if an option is 'out of the money'?
- Profitable
- No intrinsic value (Correct Answer)
- High interest
- Increased leverage
Question 19: Which document outlines the terms and rights of an option?
- Stock certificate
- Options prospectus
- Option contract (Correct Answer)
- Shareholder agreement
Question 20: When does an option have 'time value'?
- After expiry
- Before expiry (Correct Answer)
- When exercised
- With dividends
Test your skills with our NISM 8 mock test that focuses on equity derivatives. This simple quiz helps you explore key ideas like derivative markets and trading strategies, all made easy to understand. It’s a friendly way to boost your knowledge before heading for the Series 8 certification. Give it a try and see how ready you really are!
