Macro-economic factors such as interest rates, currency risk, and overall economic performance do influence AIF performance because they impact the broader environment in which investments are made. Changes in interest rates can affect borrowing costs, currency fluctuations can impact returns for foreign investors, and economic slowdowns can reduce underlying asset valuations.

Practice question from NISM Series XIX A- Alternative Investments Funds (AIF) Distributors Mock Test 5 — bank. The correct answer is highlighted below with a full explanation.

Options

True

Correct answer
B

False

Why this is the answer

Macro risks such as currency depreciation, economic slowdown, or regulatory changes can adversely affect fund returns, even for alternative assets.

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NISM Series XIX A- Alternative Investmen…