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

Identify the CORRECT statement/s with respect to Conservative Hybrid Funds: (A) A Conservative hybrid fund cannot invest in debt securities for which the Macaulay Duration is more than 1 year. (B) A Conservative hybrid fund cannot invest more than 25% of their total assets in equity instruments. (C) A Conservative hybrid fund cannot invest in debt securities which have a lower than AAA rating.

Practice question from Nism Va Mock Test 1 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Only A and B are correct

  2. Only B is correct

    Correct answer

  3. C

    Only A and C are correct

  4. D

    All A, B, and C are correct

Why this is the answer

Conservative hybrid funds can invest up to 25% in equity. There is no restriction on Macaulay duration or minimum credit rating of debt instruments as per SEBI guidelines.

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