Invesco Mutual Fund
Infosys Interview Questions and Answers
Q1. What is the difference between the Sharpe Ratio and the Treynor Ratio?
The Sharpe Ratio measures risk-adjusted return by comparing the excess return of an investment to its volatility, while the Treynor Ratio measures risk-adjusted return by comparing the excess return of an investment to its systematic risk.
Sharpe Ratio considers total risk (standard deviation) in the denominator, while Treynor Ratio considers systematic risk (beta).
Sharpe Ratio is more suitable for evaluating diversified portfolios, while Treynor Ratio is more suitable for eva...read more
Q2. What is the difference between open-ended and closed-ended funds?
Open-ended funds allow investors to buy and sell shares at any time, while closed-ended funds have a fixed number of shares and are traded on exchanges.
Open-ended funds issue and redeem shares based on demand from investors
Closed-ended funds have a fixed number of shares that are bought and sold on exchanges
Open-ended funds are priced based on the net asset value (NAV) of the underlying securities
Closed-ended funds can trade at a premium or discount to their net asset value
Ex...read more
Q3. What is your understanding of the term "compliance"?
Compliance refers to adhering to rules, regulations, standards, or laws set by an organization or governing body.
Compliance involves following guidelines to ensure ethical and legal practices within a company.
It includes meeting industry standards, laws, and regulations relevant to the business.
Non-compliance can result in penalties, fines, or legal actions against the organization.
Examples include adhering to data protection laws, workplace safety regulations, and financial ...read more
Q4. What is your understanding of call and put options?
Call options give the holder the right to buy an asset at a specified price, while put options give the holder the right to sell an asset at a specified price.
Call options are used when the investor believes the price of the asset will rise above the strike price before the expiration date.
Put options are used when the investor believes the price of the asset will fall below the strike price before the expiration date.
Options are contracts that give the holder the right, but ...read more
Q5. What is the structure of callable bonds?
Callable bonds are bonds that can be redeemed by the issuer before the maturity date.
Callable bonds give the issuer the right to call back the bond before the maturity date.
Investors receive a premium for accepting the risk of early redemption.
Callable bonds typically have a call schedule outlining when the issuer can call back the bond.
Examples of callable bonds include corporate bonds and municipal bonds.
Q6. What are financial services?
Financial services refer to the services provided by the finance industry.
Financial services include banking, investment, insurance, and other related services.
These services help individuals and businesses manage their money, invest in assets, and protect against financial risks.
Examples of financial services include checking and savings accounts, credit cards, loans, stocks and bonds, and insurance policies.
Financial services are essential for the functioning of the economy...read more
Q7. What is a capital market?
A capital market is a financial market where companies and governments can raise long-term funds.
Capital markets facilitate the buying and selling of long-term financial instruments such as stocks, bonds, and derivatives.
They provide a platform for companies and governments to raise funds for investment and growth.
Investors can earn returns on their investments through dividends, interest payments, or capital gains.
Examples of capital markets include the New York Stock Exchan...read more
Q8. What is a futures contract?
A futures contract is a legal agreement to buy or sell a particular commodity or financial instrument at a predetermined price and date in the future.
Futures contracts are traded on exchanges and are standardized in terms of quantity, quality, and delivery date.
They are used by traders and investors to hedge against price fluctuations or to speculate on future price movements.
Examples of futures contracts include those for commodities like oil, gold, and wheat, as well as fin...read more
Q9. Explain IPO process
IPO process is the process of a private company going public by offering its shares to the public for the first time.
The company hires an investment bank to underwrite the IPO
The investment bank helps the company determine the offering price and number of shares to be sold
The company files a registration statement with the SEC
The SEC reviews the registration statement and provides feedback
Once the registration statement is approved, the company sets a date for the IPO
On the d...read more
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