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

Identify the true statement(s) with respect to the benchmark for mutual fund schemes.

Practice question from NISM Series V A - Mock Test 4 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    For International Equity fund, the ideal benchmark will be BSE 500 index as it is a very broad-based index covering 500 companies

  2. For Gold ETF, gold prices will be the ideal benchmark

    Correct answer

  3. C

    Only A is correct

  4. Only B is correct

    Correct answer

  5. E

    Both A and B are correct

  6. F

    Neither A nor B are correct

Why this is the answer

The benchmark for a Gold ETF is the price of gold itself, as the fund aims to track the performance of gold. For International Equity funds, the appropriate benchmark depends on the region or country in which the scheme invests. For example, a fund investing in the U.S. may use the S&P 500, not the BSE 500.

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