SECTION-A

1. Answer any eight sub question. Each question carries two marks. (8x2=16)

a. What is a primary market?

b. What is speculation?
c. Give the meaning of right issue.
d. What are preference shares?
e. Expand SEBI, NSEI.
f. What is dematerialisation?
g. Who are jobbers?
h. What do you mean by depository?
i. What is forward settlement?
j. Mention any two recognized stock exchanges in India.
SECTION- B
Answer any three questions. Each question carries 8 marks.
2. State the differences between physical market and futures market.
3. What are the objectives of SEBI?
4. Briefly explain the different kinds of speculators.
5. What is buy back of shares? What are the conditions of buy back?
SECTION-C
Answer question No.10 compulsory and three of the following. Each question carries
fifteen marks. (4x15=60)

6. What is stock exchange? Explain the functions of stock exchange.

7. Explain the methods of issue of issue mechanism.
8. Write short notes on:
a. MCX
b. NCDX
c. NMCE
9. Discuss the role and functions of SEBI in stock trading.
10. Explain the importance and functions of commodity exchange.

"Options writer has limited profit and unlimited loss whereas options buyer has
limited loss and unlimited profits." Discuss this statement with examples.

Explain mark-to-market system of futures market along with the various types of
margins in Indian financial derivatives market.

Anchor investor plays a vital role in the Indian capital market. Explain.

Evaluate the role of commodity exchanges for hedging and speculation with the help
of appropriate examples.

Each player in the commodity market fulfills an economic activity. Justify.

The confluence of hedgers, speculators and arbitrageurs ensures liquidity and

efficient price discovery in the commodity derivatives market. Comment.
CAPITAL MARKET Question paper

SECTION – A
Answer any ten questions. Each question carries two marks.
1. What is acceptance market ?
2. What is DUPN ?
3. Define money market.
4. What do you understand by option ?
5. Who is a jobber ?
6. What is gilt edged securities ?
7. What do you mean by C.P. ?
8. What is meant by dematerialisation ?
9. What is mutual trading ?
10. Who is an investor ?
11. What do you mean by bear ?
12. What is listing ?
(10×2=20 Marks)

SECTION – B
Answer any eight questions. Each question carries 5 marks.
13. Describe the Constituents of Indian Financial System.
14. What are the weakness of IFS ?
15. What are the features of money market ?
16. Explain the features of a call money market.
17. State the importance of a commercial bill market.
18. What are the recent guidelines issued by RBI for CDs ?
19. State the features of C.P.
20. Explain the defects of indegeneous bankers.
21. State the functions of SEBI.
22. Explain the measures introduced by RBI in reducing inflation.
23. Explain the functions of IFCI.
24. State the provisions of Securities Contract (Regulation) Act.
(8×5=40 Marks)

SECTION – C
Answer any two questions. Each question carries 20 marks.
25. Describe the recent trends in Indian money market.
26. Illustrate the role of LIC in Indian Corporate Sector.
27. State the impact of "Bombay War" in Indian Capital Market and Corporate
Sector.
28. Explain the structure of IFS in detail.
(2×20=40 Marks)
Derivatives and commodities
Unit 1
Who are the participants of commodities and derivatives markets
What are the advantages of investing in commodities
What are the types of derivative instruments
What are the features and importance of derivatives
Futures vs forwards vs options
OTC vs ETC
What are the disadvantages of investing in derivatives
What are the factors driving the growth of derivatives markets
Unit 2
What are index futures and what are features of the same
Concepts:- cost of carry, basis, open interest, initial margin, maintenance margin,
cash vs physical settlement, SPAN, limit order, market if touched order, long hedge,
short hedge, cross hedge, Novation, cash and carry, perfect and imperfect hedge,
convergence
How are futures settled
Hedging strategies with futures
What are the uses of futures
Numerical on payoff of futures along with payoff chart, cash and carry arbitrage

Unit 3
Concepts on strike price, moneyless of options, delta, theta, gama, rho, American
and European option,
Why do we buy an option call or put
What are the pricing models for option contracts (BSM and Binomial)
What are the factors affecting option premium
How do we hedge with options
Trading strategies with options
Numericals on options strategies along with payoff charts
Unit 4
What are the types of risk in derivatives
Explain VaR and how is it calculated
What are the different types of margins in derivatives
Explain the regulatory framework for derivatives in India
Role of SEBI in ensuring investor protection for derivatives
What are the types of orders and how can they be settled.
What is NSCCL and elaborate the functions and objectives of the same