n NISM Certifications
XXI NISM Series XXI-A
Medium

Most appropriate benchmark to reduce or mitigate inflation risk?

Practice question from NISM XXI A for PMS - Mock Test 2 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    G-Sec Index

  2. Floating interest rate index

    Correct answer

  3. C

    Low duration index

  4. D

    High credit quality index

Why this is the answer

A floating interest rate index adjusts with market interest rates, providing a hedge against inflationary rises that typically push interest rates higher.

Test yourself for real

Take a full NISM Series XXI-A mock test.

Same duration, same weighting, same difficulty distribution as the real exam — with explanations on every question.