n NISM Certifications
X NISM Series X
Medium

Mutual funds are classified as relative return products because their performance is linked to the performance of their underlying asset class, such as equity or debt.

Practice question from NISM Series XB- Investment Adviser (Level 2) Mock Test 4 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    High return

  2. B

    Low return

  3. C

    Absolute return

  4. Relative return

    Correct answer

Why this is the answer

Mutual funds aim to generate returns relative to their asset class benchmarks, reflecting their nature as relative return products.

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