n NISM Certifications
XXI NISM Series XXI-A
Medium

What does the investment approach define in a PMS agreement?

Practice question from NISM XXI A for PMS - Mock Test 2 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    The nature of securities the PMS can invest in

  2. B

    The universe of instruments from which the PMS has to choose for the client’s fund management

  3. C

    The nature of companies in which the portfolio manager can invest

  4. All of the above

    Correct answer

Why this is the answer

The investment approach encompasses the types of securities, the universe of instruments, and the company's investment style as per the client’s mandate.

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