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

SEBI has regulations pertaining to restrictions on the investment policies of mutual fund schemes for ensuring that _____ .

Practice question from NISM Series V A - Mock Test 3 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    The mutual scheme can improve their ratings over a period of time

  2. B

    The scheme returns are better than the benchmark returns

  3. C

    The scheme returns are better than the Nifty/Sensex

  4. The mutual fund scheme has a minimum diversification as per the requirements

    Correct answer

Why this is the answer

SEBI regulations are designed to ensure that mutual fund schemes maintain adequate diversification in their portfolios. This reduces concentration risk and ensures that funds are invested across various assets, minimizing risks for investors.

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