n NISM Certifications
X NISM Series X
Medium

'Laddering' of bonds refers to investing in bonds of various maturities that are staggered over different dates, creating a steady income stream and reducing reinvestment risk.

Practice question from NISM Series XB- Investment Adviser (Level 2) Mock Test 2 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. Laddering means investing in bonds of various maturities which are spread over years

    Correct answer

  2. B

    Laddering means investing in different types of bonds

  3. C

    Laddering means investing in bonds of different credit rating

  4. D

    Laddering means investing in bonds which yields higher interest rates

Why this is the answer

Laddering involves purchasing bonds maturing at different times to diversify maturity dates, ensuring continuous income.

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