n NISM Certifications
X NISM Series X
Medium

Given a cumulative wealth relative of 1.8422 over 5 years, what is the approximate CAGR?

Practice question from NISM Series XA- Investment Adviser (Level 1) Mock Test 7 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    13.45%

  2. 12.99%

    Correct answer

  3. C

    8.66%

  4. D

    10.85%

Why this is the answer

CAGR = (1.8422)^(1/5) – 1 ≈ 12.99%.

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