n NISM Certifications
X NISM Series X
Medium

The factors satisfying the 'Quantitative Selection' criteria for an AIF include hurdle rate, drawdown phase, past IRR indicators, and minimum commitment, providing an objective basis for fund evaluation.

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

  1. A

    Fund manager reputation and investment philosophy

  2. B

    Market outlook and sector preferences

  3. Hurdle rate, drawdown phase, past IRR indicators, minimum commitment

    Correct answer

  4. D

    Governance structure and compliance framework

Why this is the answer

Quantitative selection criteria rely on measurable and objective data points that allow investors to evaluate and compare AIFs consistently. Factors such as the hurdle rate, drawdown phase, past IRR indicators, and minimum commitment are numerical or time-bound metrics that reflect performance expectations and investment structure. These parameters help investors shortlist funds based on clear financial benchmarks and investment terms, rather than subjective judgments.

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