n NISM Certifications
X NISM Series X
Medium

How should the benchmark chosen for a portfolio be managed?

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

    Changed whenever portfolio holdings change

  2. Regularly reviewed for continued suitability

    Correct answer

  3. C

    Retained for the entire investment period

  4. D

    Approved by regulators

Why this is the answer

Benchmarks must be periodically reviewed to ensure they remain aligned with the portfolio’s investment objectives, strategy, and changing market conditions.

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