Mutual Fund Mastery interview preparation

Questions

100

Traced to a firm

32

Firms

19

Updated

September 2026

Asked at

All firmsVanguard5BLBlackRock3FTFranklin Templeton3Invesco3PIMCO3Fidelity Investments2J.P. Morgan2Morningstar2Neuberger Berman2SCSchroders2T. Rowe Price2Amundi1BMBNY Mellon1Goldman Sachs1Man Group1Northern Trust1SSState Street1Sycamore Partners1WMWellington Management1

Topic

All topicsFund structure and regulation7NAV and operations6Scheme categorisation4Equity schemes5Debt schemes7Risk, liquidity and disclosure7Index funds and ETFs6Hybrid and solution schemes3Costs, plans and commissions6SIP and investor mechanics5Performance measurement6Taxation5Distribution, compliance and NISM5Portfolio construction and advice5Estimation and numeracy5Markets and industry6Career and fit12

Level

AnyCoreIntermediateHard

Type

AnyTechnicalCaseFitBrainteaserMarket view

1. 015Define large cap, mid cap and small cap for me, and explain how the AMFI list works.Scheme categorisationCorephone / first roundIndian AMCsEquity research at AMCs

   Say this

   Rank every listed company by average full market capitalisation. The top 100 are large cap, 101 to 250 are mid cap, and 251 onwards are small cap. AMFI publishes that list twice a year and every AMC must use it — there is no house definition in India.

   Then walk it

   1. Full market cap, not free float, and averaged over the six months prior, so a single volatile month cannot move a company between buckets.
   2. AMFI releases the list every six months, in consultation with SEBI. Funds get a short cooling period and then a rebalancing window — currently three months — to bring portfolios back inside the mandate.
   3. The bucket sizes are fixed by count, not by market cap value, which has a strange consequence: as the market grows, the 250th company can be a 40,000 crore business that everywhere else in the world would be called a mid cap.
   4. It drives real flows. A stock promoted from 101 to inside the top 100 becomes eligible for every large cap fund's 80 percent bucket and is no longer countable for mid cap funds. The reclassification itself moves the price.
   5. Category minimums hang off this list: large cap 80 percent in the top 100, mid cap 65 percent in 101 to 250, small cap 65 percent in 251 and below, large and mid cap at least 35 percent in each.
   6. The limitation to state: a rank-based definition means the boundary is arbitrary and moves. Two funds can both be compliant mid cap funds while owning very different businesses, because the 101st and the 250th company have almost nothing in common.

   Where candidates lose it

   Guessing the cut-offs. The 100 and 250 boundaries are the single most frequently asked recall fact in this track and getting them wrong ends the conversation. Also say 'full market cap, averaged over six months' — candidates who say free float reveal they learned it from an index methodology instead of the AMFI circular.

   Expect next

   • What happens to a mid cap fund when one of its holdings is promoted to large cap?
   • How long does a fund get to rebalance?
   • Is a rank-based definition sensible as the market grows?
2. 017Explain open-ended, close-ended and interval schemes.Scheme categorisationCorephone / first roundIndian AMCsDistribution and sales

   Say this

   An open-ended scheme creates and cancels units on demand at NAV every business day. A close-ended scheme issues a fixed number of units at launch, is listed, and returns capital only at maturity. An interval scheme is close-ended but opens a transaction window at pre-specified intervals.

   Then walk it

   1. Open-ended is the default in India and almost all retail money sits here. Unit capital floats, you transact with the AMC at NAV, and liquidity is the AMC's obligation.
   2. Close-ended: fixed corpus, fixed tenor, mandatory listing on an exchange. In theory you exit by selling on the exchange; in practice Indian close-ended schemes trade thin and at a discount to NAV, so exchange liquidity is a fiction.
   3. The argument for close-ended is that the manager has stable capital and cannot be forced to sell into a falling market. Fixed maturity plans used it well on the debt side, matching a portfolio's maturity to the scheme's.
   4. Interval schemes sit in between, with specified transaction periods of at least two working days and a gap of at least fifteen days between them. A niche product, mostly debt.
   5. One regulatory consequence: a close-ended scheme cannot be wound up early just because the manager wants out, and an open-ended one cannot suspend redemptions except in narrow circumstances with trustee approval. That distinction became very concrete in April 2020.
   6. The trade-off is honest either way: open-ended gives the investor liquidity and gives the manager a forced-seller problem. Close-ended fixes the manager's problem by transferring the liquidity risk to the investor, who then discovers the listing does not help.

   Where candidates lose it

   Claiming a close-ended scheme is liquid because it is listed. Indian close-ended schemes routinely trade at 5 to 15 percent discounts on negligible volume. Say that out loud — it is the difference between reciting a definition and knowing the market.

   Expect next

   • Why do close-ended funds trade at a discount?
   • What was a fixed maturity plan and why did they fall out of favour?
   • When can an open-ended fund stop redemptions?

Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.