Bombay Stock Exchange (BSE) is one of the oldest and most important stock exchanges in India. Established in 1875, it plays a crucial role in the country’s financial market by providing a platform for buying and selling shares of various companies. The BSE helps investors trade securities and offers a transparent environment for investment.
To enhance your understanding of the BSE, we have created a quiz that features general knowledge questions related to its history, functions, and significance in the financial world. This quiz is a fun and interactive way to test your knowledge and learn more about the BSE. Whether you’re a student, a finance enthusiast, or just curious about the stock market, this quiz will help you gain valuable insights into one of India’s key financial institutions. Get ready to challenge yourself and discover more about the BSE!
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GK Questions on BSE and Quiz with Answers
Ques: What does BSE stand for?
A) Bombay Stock Exchange
B) Bangalore Stock Exchange
C) Bharat Stock Exchange
D) British Stock Exchange
Ans: A) Bombay Stock Exchange
Explanation BSE is the acronym for Bombay Stock Exchange, the first stock exchange in Asia.
Ques: When was the Bombay Stock Exchange established?
A) 1875
B) 1880
C) 1900
D) 1947
Ans: A) 1875
Explanation BSE was established in 1875 as the Native Share and Stock Brokers’ Association.
Ques: What is the SENSEX?
A) A stock market index
B) A bond market index
C) A commodity index
D) A mutual fund index
Ans: A) A stock market index
Explanation SENSEX is the benchmark index of the Bombay Stock Exchange, representing 30 of the largest and most actively traded stocks.
Ques: How many companies are included in the SENSEX?
A) 20
B) 30
C) 40
D) 50
Ans: B) 30
Explanation The SENSEX comprises 30 well-established and financially sound companies listed on the BSE.
Ques: Who regulates the BSE?
A) SEBI
B) RBI
C) IRDA
D) Ministry of Finance
Ans: A) SEBI
Explanation The Securities and Exchange Board of India (SEBI) regulates the BSE to protect investor interests and ensure market integrity.
Ques: What is the primary function of BSE?
A) Currency trading
B) Commodity trading
C) Stock trading
D) Real estate trading
Ans: C) Stock trading
Explanation BSE primarily facilitates the trading of stocks and other securities.
Also Check – GK Questions on Sensex with Answers
Ques: What is the full form of IPO?
A) Initial Public Offering
B) Initial Private Offering
C) Internal Public Offering
D) Internal Private Offering
Ans: A) Initial Public Offering
Explanation IPO stands for Initial Public Offering, which is the process by which a private company offers its shares to the public for the first time.
Ques: Who is eligible to invest in BSE?
A) Only Indian citizens
B) Only NRIs
C) Both Indian citizens and NRIs
D) Only institutional investors
Ans: C) Both Indian citizens and NRIs
Explanation Both Indian citizens and Non-Resident Indians (NRIs) are eligible to invest in BSE.
Ques: What is a Blue Chip stock?
A) A stock with high volatility
B) A stock with high dividends
C) A stock with high liquidity
D) A stock of a well-established and financially sound company
Ans: D) A stock of a well-established and financially sound company
Explanation Blue Chip stocks are shares of large, well-established, and financially sound companies with a history of reliable performance.
Ques: What does market capitalization mean?
A) Total revenue of a company
B) Total profit of a company
C) Total value of a company’s outstanding shares
D) Total assets of a company
Ans: C) Total value of a company’s outstanding shares
Explanation Market capitalization is the total market value of a company’s outstanding shares of stock.
Ques: What is the trading time for BSE?
A) 9:00 AM to 3:30 PM
B) 10:00 AM to 4:30 PM
C) 9:30 AM to 4:00 PM
D) 10:30 AM to 5:00 PM
Ans: C) 9:30 AM to 4:00 PM
Explanation The trading hours for BSE are from 9:30 AM to 4:00 PM, Monday to Friday.
Ques: What does the term ‘bull market’ signify?
A) A market in decline
B) A market with stagnant prices
C) A market with rising prices
D) A market with falling prices
Ans: C) A market with rising prices
Explanation A bull market is characterized by rising prices and investor confidence.
Ques: What is a ‘bear market’?
A) A market with rising prices
B) A market with falling prices
C) A market with stagnant prices
D) A market with high volatility
Ans: B) A market with falling prices
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Explanation A bear market refers to a period of declining stock prices and generally pessimistic investor sentiment.
Ques: What is a ‘stop-loss’ order?
A) An order to buy a stock at a higher price
B) An order to sell a stock at a higher price
C) An order to buy a stock at a lower price
D) An order to sell a stock when it reaches a certain price
Ans: D) An order to sell a stock when it reaches a certain price
Explanation A stop-loss order is placed to sell a stock once it reaches a specified price to limit an investor’s loss.
Ques: What is the minimum face value of a share on BSE?
A) Rs. 1
B) Rs. 2
C) Rs. 5
D) Rs. 10
Ans: A) Rs. 1
Explanation The minimum face value of a share on BSE is Rs. 1, though it can be higher depending on the company’s decision.
Ques: What is ‘dematerialization’ in the context of stocks?
A) Converting physical shares to electronic form
B) Converting electronic shares to physical form
C) Issuing new shares
D) Selling old shares
Ans: A) Converting physical shares to electronic form
Explanation Dematerialization is the process of converting physical share certificates into electronic form.
Ques: What is the role of a stockbroker?
A) To lend money to investors
B) To provide market information
C) To facilitate the buying and selling of stocks
D) To manage a company’s financials
Ans: C) To facilitate the buying and selling of stocks
Explanation Stockbrokers act as intermediaries between buyers and sellers in the stock market.
Ques: What is the BSE SME platform?
A) A platform for trading commodities
B) A platform for trading government bonds
C) A platform for small and medium enterprises
D) A platform for international stocks
Ans: C) A platform for small and medium enterprises
Explanation The BSE SME platform is designed for small and medium enterprises to raise capital and get listed on the exchange.
Ques: What is ‘insider trading’?
A) Trading by foreign investors
B) Trading by institutional investors
C) Trading based on non-public information
D) Trading during off-hours
Ans: C) Trading based on non-public information
Explanation Insider trading involves buying or selling a company’s stock based on confidential information not available to the public.
Ques: What is the function of the clearinghouse in BSE?
A) To settle trades and ensure smooth transactions
B) To provide investment advice
C) To manage the stock exchange
D) To issue new stocks
Ans: A) To settle trades and ensure smooth transactions
Explanation The clearinghouse ensures the proper settlement of trades, reducing the risk of default.
Ques: What does ‘liquidity’ in the stock market refer to?
A) The volume of shares traded
B) The ease with which an asset can be converted to cash
C) The market value of shares
D) The profitability of a company
Ans: B) The ease with which an asset can be converted to cash
Explanation Liquidity refers to how quickly and easily an asset can be bought or sold in the market without affecting its price.
Ques: What is ‘diversification’ in investing?
A) Investing in only one type of asset
B) Spreading investments across various asset classes to reduce risk
C) Investing in foreign markets only
D) Investing in high-risk assets only
Ans: B) Spreading investments across various asset classes to reduce risk
Explanation Diversification involves spreading investments across different assets to reduce exposure to any single asset’s risk.
Ques: What is a ‘stock split’?
A) Issuing new shares to existing shareholders
B) Merging two companies
C) Increasing the stock price
D) Dividing existing shares into multiple shares
Ans: D) Dividing existing shares into multiple shares
Explanation A stock split increases the number of shares by dividing the existing shares into multiple shares, thereby reducing the price per share.
Ques: What does ‘NSE’ stand for?
A) National Stock Exchange
B) New Stock Exchange
C) Northern Stock Exchange
D) Notable Stock Exchange
Ans: A) National Stock Exchange
Explanation NSE stands for National Stock Exchange, another major stock exchange in India.
Ques: What is ‘short selling’?
A) Selling a stock before buying it
B) Buying a stock and holding it for the long term
C) Selling a stock at a profit
D) Selling a stock after it increases in value
Ans: A) Selling a stock before buying it
Explanation Short selling involves selling a stock that the seller does not own, with the intention of buying it back later at a lower price.
Ques: What is ‘market sentiment’?
A) The overall attitude of investors towards a particular market
B) The financial health of a company
C) The volume of shares traded
D) The market capitalization of a company
Ans: A) The overall attitude of investors towards a particular market
Explanation Market sentiment refers to the general mood or attitude of investors towards a particular market or investment.
Also Read – GK Questions and Answers on Nifty 50
Ques: What is a ‘market order’?
A) An order to buy or sell at a specific price
B) An order to buy or sell immediately at the best available price
C) An order to buy or sell at the close of the market
D) An order to buy or sell at the opening of the market
Ans: B) An order to buy or sell immediately at the best available price
Explanation A market order is executed immediately at the best available current price.
Ques: What does ‘P/E ratio’ stand for?
A) Price to Earnings ratio
B) Profit to Earnings ratio
C) Price to Equity ratio
D) Profit to Equity ratio
Ans: A) Price to Earnings ratio
Explanation The P/E ratio is a measure of a company’s current share price relative to its per-share earnings.
Ques: What is a ‘limit order’?
A) An order to buy or sell at a specific price or better
B) An order to buy or sell immediately at any price
C) An order to buy or sell at the market close
D) An order to buy or sell at the market open
Ans: A) An order to buy or sell at a specific price or better
Explanation A limit order specifies the maximum price to pay or the minimum price to accept for a security.
Ques: What is an ‘index fund’?
A) A mutual fund that aims to replicate the performance of a specific index
B) A fund that invests in international stocks
C) A fund that invests in commodities
D) A fund that invests in high-risk stocks
Ans: A) A mutual fund that aims to replicate the performance of a specific index
Explanation An index fund is designed to track the performance of a market index, such as the SENSEX or Nifty 50.
Ques: What is ‘alpha’ in investing?
A) A measure of a portfolio’s return compared to the market return
B) A measure of a portfolio’s risk
C) A measure of market volatility
D) A measure of a portfolio’s liquidity
Ans: A) A measure of a portfolio’s return compared to the market return
Explanation Alpha represents the excess return of an investment relative to the return of a benchmark index.
Ques: What is ‘beta’ in investing?
A) A measure of a portfolio’s return
B) A measure of a portfolio’s risk relative to the market
C) A measure of market sentiment
D) A measure of a company’s profitability
Ans: B) A measure of a portfolio’s risk relative to the market
Explanation Beta measures the volatility of an investment relative to the overall market.
Ques: What is ‘dividend yield’?
A) The annual dividend paid by a company as a percentage of its share price
B) The annual revenue of a company
C) The annual profit of a company
D) The annual market capitalization of a company
Ans: A) The annual dividend paid by a company as a percentage of its share price
Explanation Dividend yield is calculated by dividing the annual dividend per share by the current share price.
Ques: What is ‘market capitalization’?
A) The total revenue of a company
B) The total profit of a company
C) The total value of a company’s outstanding shares
D) The total assets of a company
Ans: C) The total value of a company’s outstanding shares
Explanation Market capitalization is the market value of a company’s outstanding shares of stock.
Ques: What is ‘earnings per share (EPS)’?
A) The company’s total earnings divided by the number of outstanding shares
B) The company’s total revenue divided by the number of outstanding shares
C) The company’s total profit divided by the number of outstanding shares
D) The company’s total assets divided by the number of outstanding shares
Ans: A) The company’s total earnings divided by the number of outstanding shares
Explanation EPS is calculated by dividing the company’s total earnings by the number of outstanding shares.
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Ques: What is ‘return on equity (ROE)’?
A) The return on the total assets of a company
B) The return on the total revenue of a company
C) The return on the total equity of a company
D) The return on the total profit of a company
Ans: C) The return on the total equity of a company
Explanation ROE measures a company’s profitability by comparing net income to shareholders’ equity.
41. What is ‘systematic risk’?
A) The risk that can be diversified away
B) The risk inherent to the entire market
C) The risk associated with a specific company
D) The risk associated with a specific industry
Ans: B) The risk inherent to the entire market
Explanation Systematic risk affects the entire market and cannot be eliminated through diversification.
Ques: What is ‘unsystematic risk’?
A) The risk inherent to the entire market
B) The risk that can be diversified away
C) The risk associated with the economy
D) The risk associated with interest rates
Ans: B) The risk that can be diversified away
Explanation Unsystematic risk is specific to a company or industry and can be reduced through diversification.
Ques: What is ‘capital gain’?
A) The profit from the sale of an asset
B) The profit from dividends
C) The profit from interest
D) The profit from reinvestment
Ans: A) The profit from the sale of an asset
Explanation Capital gain is the profit made from selling an asset at a higher price than its purchase price.
Ques: What is ‘insider trading’?
A) Trading by institutional investors
B) Trading by foreign investors
C) Trading based on non-public information
D) Trading during off-market hours
Ans: C) Trading based on non-public information
Explanation Insider trading involves trading a company’s stock based on confidential information not available to the public.
Ques: What is ‘portfolio diversification’?
A) Investing in only one type of asset
B) Investing in a variety of assets to reduce risk
C) Investing in high-risk assets
D) Investing in foreign markets only
Ans: B) Investing in a variety of assets to reduce risk
Explanation Portfolio diversification involves spreading investments across different asset classes to reduce overall risk.
Ques: What is ‘intraday trading’?
A) Trading that involves holding positions overnight
B) Trading that involves buying and selling within the same trading day
C) Trading that involves long-term investments
D) Trading that involves buying and holding for years
Ans: B) Trading that involves buying and selling within the same trading day
Explanation Intraday trading refers to buying and selling securities within the same trading day.
Ques: What is a ‘margin account’?
A) An account that allows borrowing of funds to purchase securities
B) An account that does not allow borrowing of funds
C) An account that holds physical stock certificates
D) An account that only holds mutual funds
Ans: A) An account that allows borrowing of funds to purchase securities
Explanation A margin account allows investors to borrow money from a broker to purchase securities, using the purchased securities as collateral.
Ques: What is ‘arbitrage’ in the stock market?
A) Buying and holding a stock for long-term gains
B) Simultaneously buying and selling an asset in different markets to profit from price differences
C) Investing in high-risk stocks for high returns
D) Buying stocks with borrowed funds
Ans: B) Simultaneously buying and selling an asset in different markets to profit from price differences
Explanation Arbitrage involves exploiting price differences of the same asset in different markets for profit.
Ques: What is a ‘hedge fund’?
A) A fund that insures stocks against loss
B) A private investment fund that engages in a wide range of investment activities
C) A fund that only invests in bonds
D) A fund that is managed by the government
Ans: B) A private investment fund that engages in a wide range of investment activities
Explanation Hedge funds are private investment funds that employ various strategies to earn active returns for their investors.
Ques: What is ‘market capitalization’?
A) The total value of a company’s outstanding shares
B) The total revenue of a company
C) The total profit of a company
D) The total assets of a company
Ans: A) The total value of a company’s outstanding shares
Explanation Market capitalization is the total market value of a company’s outstanding shares of stock.
