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

Identify the TRUE statement.

Practice question from Nism VA Mock Test 6 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    While calculating scheme returns for an investor, if there is an entry load, then the initial value of the Net Asset Value (NAV) is taken as NAV minus Entry Load

  2. While calculating scheme returns for an investor, if there is an exit load, then the later value of the Net Asset Value (NAV) is taken as NAV minus Exit Load

    Correct answer

Why this is the answer

When calculating scheme returns, the entry load is added to the NAV (as it increases the purchase cost), while the exit load is subtracted from the NAV (as it reduces the redemption amount).

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Nism VA Mock Test 6