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

Identify which of these statement/s is/are CORRECT? A. Investors can be categorized on the basis of their age and investors of the same age should always have the same asset allocation in their investment portfolios B. Only after considering the individual's risk profile, the asset allocation should be done between the core portfolio and satellite portfolio.

Practice question from NISM series VA - Mid length mock test — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Only statement A is correct

  2. Only statement B is correct

    Correct answer

  3. C

    Both statements A and B are correct

  4. D

    None of the above

Why this is the answer

Asset allocation should be based on an investor's risk profile, not just their age. Core and satellite portfolios are customized according to individual preferences and goals. Statement A is incorrect because investors of the same age can have different financial situations, goals, and risk tolerance, which affect their asset allocation.

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