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

Identify the FALSE statement(s).(A) During redemption, the mutual fund distributor should guide the investor to redeem those schemes which have the highest exit load (B) The best strategy in selecting a mutual fund scheme for investment is that based on its past performance

Practice question from NISM Series V A - Mock Test 2 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Only A is false

  2. B

    Only B is false

  3. Both A and B are false

    Correct answer

  4. D

    Neither A nor B are false

Why this is the answer

A is false because the distributor should guide the investor to redeem units from schemes with the lowest exit load, not the highest. B is false because mutual fund investments should not be based solely on past performance, as past performance does not guarantee future returns. It's important to consider the scheme's investment objectives, risk profile, and consistency over time.

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