n NISM Certifications
V-A NISM Series V-A
Medium

Among these funds, which will have the lowest Interest Rate Risk?

Practice question from NISM Series V A - Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. Money market fund

    Correct answer

  2. B

    Diversified Equity Fund

  3. C

    Pharma Sector fund

  4. D

    Dynamic Bond Fund

Why this is the answer

Money market funds invest in short-term debt instruments, which are less sensitive to changes in interest rates. Therefore, they have the lowest interest rate risk compared to other funds like bond funds, which invest in longer-term securities.

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