n NISM Certifications
X NISM Series X
Medium

What does 'Risk Appetite' refer to?

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

Options

  1. The level of risk an investor is comfortable with

    Correct answer

  2. B

    The risk an investor should take based on age

  3. C

    The risk needed to meet all financial goals

  4. D

    The risk that maximizes risk-adjusted returns

Why this is the answer

Risk appetite reflects the degree of risk an investor is willing to accept to achieve their objectives.

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