n NISM Certifications
X NISM Series X
Medium

The 'pooling vehicle' for an AIF should be an incorporated entity to ensure it is ring-fenced with limited liability, protecting investors from undue risks.

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

    Managed by the sponsor entity

  2. Ring-fenced with limited liability

    Correct answer

  3. C

    Provide customized service to investors

  4. D

    Situated offshore

Why this is the answer

Incorporation ensures the pooled assets are protected through limited liability, safeguarding investor interests.

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